CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

[Amethyst]

http://www.bailii.org/ew/cases/EWHC/QB/2009/3417.html
The following is a brief summary of the principal findings and conclusions set out above:

1. (1) A creditor can satisfy its duty under s78 by providing a reconstituted version of the executed agreement which may be from sources other than the actual signed agreement itself;
   (2) The s78 copy must contain the name and address of the debtor as it was at the time of the execution of the agreement. But the creditor can provide the name and address from whatever source it has of those details. It does not have to take them from the executed agreement itself;
   (3) The creditor need not, in complying with s78, provide a document which would comply (if signed) with the requirements of the Consumer Credit (Agreements) Regulations 1983 as to form, as at the date the agreement was made;
   (4) If an agreement has been varied by the creditor under a unilateral power of variation, the creditor must still provide a copy of the original agreement, as well as the varied terms;
   (5) If a creditor is in breach of section 78 this does not of itself give rise to an unfair relationship within the meaning of section 140A;
   (6) The Court has jurisdiction to declare whether in a particular case, there has been a breach of s78. Whether it will be appropriate to grant such a declaration depends on the circumstances of that case;
   (7) In assessing whether Prescribed Terms are "contained" in an executed agreement the principles set out at paragraph 173 above are relevant. On the assumed facts set out at paragraph 177 the Prescribed Terms were so contained;
   (8) The claims that there was an unfair relationship and an IEA in Adris should be struck out or dismissed. The claim that there was an IEA in Yunis should be struck out or dismissed. The absence of any positive pleaded case or evidence as to the circumstances of the making of the agreement by the debtor concerned was fatal to the IEA claims. The absence of any positive plea or evidence as to particular facts relied upon in support of the unfair relationship claim other than failure to provide a s78 copy, was fatal to that claim.

For info
173 ~~~~ The parties in Carey have helpfully agreed the following principles. The fourth one was added by Mr Uff, with their agreement. No other party takes issue with them. The OFT has formulated the matter in a slightly different way but accepts these principles are close to its position.

1. (1) It is not sufficient for the piece of paper signed by the debtor merely to cross-refer to the Prescribed Terms without a copy of those terms being supplied to the debtor at the point of signature;
   (2) A document need not be a single piece of paper;
   (3) Whether several pieces of paper constitute one document is a question of substance not form. In particular a physical connection between several pieces of paper is not necessary in order for them to constitute one document;
   (4) Additionally, a physical connection (or one or more physical connections) between several pieces of paper does not necessarily constitute them as one document;
   (5) Accordingly, where the debtor's signature and the Prescribed Terms appear on separate pieces of paper, the questions of whether those pieces of paper together constitute one document is a question of substance and not form.
   
   
   174 ~~As a matter of law, those principles appear to me to be correct, in the context of s61.

177

1. According to HSBC, p197 is a reconstituted application form. I referred to it above in the context of Issues 1 and 2. The assumed facts here are as follows:
   (1) Ms Carey signed a form which contained, among other things, the entries at p197 including the specific reference to being bound by "the terms and conditions attached"; that form did not itself have the Prescribed Terms stated on the front or the reverse;
   (2) The form (referred to as "a signature page" in the WS from Alan Burden dated 3 December 2009) would have been produced with Ms Carey's details already on, for her to sign once her application, already made, had been approved;
   (3) At the same time as the form was produced electronically, the relevant terms and conditions (including the Prescribed Terms and information) would have been printed off and physically attached to the form by a staple;
   (4) Ms Carey would then have been invited to read the agreement, consisting of the signature page and attached terms and would then have signed and dated the signature page. It would then have been countersigned by the bank;
   (5) The relevant terms and conditions would not have been precisely in the form of pages 198-201 simply because that is a s63 copy with the different cancellation clause. But they would have been the full terms with the Prescribed Terms included either in landscape form (as shown at ppl98-201) or portrait form.

178~~~Ms Tolaney contends that on those assumed facts, the document signed by the debtor did indeed "contain" the Prescribed Terms. I agree for the following reasons:

1. (1) As described, it is hard to see the form and attached terms as anything other than one document. It is not suggested that there were separate page numbers on the terms attached but if there were, on these assumed facts, it would make no difference;
   (2) The signature page itself makes clear that it is incomplete as a document and needs something else because it has no terms on it at all and makes specific reference to the terms "attached"; it only makes sense if something else goes with it; equally pp 198-201 need something to go with them, not least a place for the applicant's details and signature;
   (3) The signature page refers to a credit agreement regulated by the Act and so makes clear that it is the first page of an agreement for which there must be other pages;
   (4) The signature page and terms are presented to the debtor as a package;
   (5) This would satisfy the notion that the Prescribed Terms can be identified within the "four corners of the agreement" - see Hurstanger v Wilson [2007] 1 WLR 2351 per Tuckey LJ at para. 11.

http://www.prlog.org/10436444-high-c...manchester.pdf

[flashfreddie]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

I am just a little confused still - I can understand that a company may send T&Cs' as what they now call 'reconstituted' documents BUT does that absolve them from sending me this and a copy of the Original Signed Agreement. Capital 1 keep sending me only a copy of the Signed Application form and quote Carey v HSBC as saying this is ALL they have to send.

and I started asking for this information a Year ago - is that before or after the Carey case and does it make any difference to my rights?

Any information gratefully accepted

[natweststaffmember]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

I am just a little confused still - I can understand that a company may send T&Cs' as what they now call 'reconstituted' documents BUT does that absolve them from sending me this and a copy of the Original Signed Agreement. Capital 1 keep sending me only a copy of the Signed Application form and quote Carey v HSBC as saying this is ALL they have to send.

and I started asking for this information a Year ago - is that before or after the Carey case and does it make any difference to my rights?

Any information gratefully accepted

I think you need to read the judgement in full because, regardless of when you asked, HSBC v. Carey is still the case that you may or may not apply to you,

[KenVal]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

Carey V HSBC Bank plc [2009] EWHC 3417 (QB) (23 December 2009)

"108. Accordingly, I conclude that Reg. 7 requires *a copy of the executed agreement in its original form *as well as a statement of the terms as they are at the time of the request."

"SUMMARY OF FINDINGS:

234.

(4). If an agreement has been varied by the creditor under a unilateral power of variation, the creditor must still provide a copy of the original agreement, as well as the varied terms."

The above seems to indicate that an Original agreement would be required for enforcement - As does CPR rules. Am I correct ?

[Lost]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

Hi,

First Post

In lay terms the creditor (credit Card Company or DCA) can just knock any old rubbish up…

Is this correct?

Thanks

[Curlyben]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

To comply with an s77/78 request, yes, BUT court action is something different.

[Ihaterbs]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

To comply with an s77/78 request, yes, BUT court action is something different.

Agreed.

Wilson clearly established that the court should not make an enforcement order unless there is a signed document containing the prescribed terms.

Regards

[Curlyben]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

And that STILL holds true.
Carey was more concerned with s77/78 requirements, the 12 day deadline and reporting to CRA's.

A number of CMC's where basing their activities from the response to the s77/78 request.

Now just because they have been given this leeway doesn't mean everything else is out of the window.
Pre 2005 agreements still have to contain ALL of the prescribed terms within the signature document to be compliant. This was always the case.

This case also clarified, incorrectly IMHO, what enforcement actual is.

[Ihaterbs]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

The COA make reference to there is which effectively means the original signed document.

Regards


Wilson – Court of Appeal

29. The contrast between sections 127(1) and 127(3) of the 1974 Act is striking. Section 127(1) provides that, on an application under section 65(1) of the Act for an enforcement order in relation to an improperly executed agreement, the court shall dismiss the application if, but only if, it considers it just to do so. In considering whether it is just to refuse an enforcement order, the court must have regard to questions of prejudice and culpability; and to its own powers to reduce or discharge any sum payable by the debtor or to impose terms and conditions in the order. Section 127(3) provides that the court shall not make an enforcement order on an application under section 65(1) of the Act where the reason why the agreement is not properly executed (for the purposes of section 61(1)) is that there is no document signed by the debtor, which contains all the prescribed terms. In such a case the court can have no regard to prejudice or culpability. It is immaterial that the creditor was in no way to blame for the omission; it is immaterial that the omission has caused no prejudice to the debtor; it is immaterial that any prejudice which the omission has caused to the debtor could be the subject of some compensating provision in an enforcement order.


43. Section 127(3) of the 1974 Act falls into three parts: (i) "The court shall not make an enforcement order under section 65(1)"; (ii) "if section 61(1)(a) (signing of agreements) was not complied with"; (iii) "unless a document (. . .) itself containing all the prescribed terms of the agreement was signed by the debtor . . ." Section 61(1)(a) requires "a document in the prescribed form itself containing all the prescribed terms and conforming to regulations under section 60(1) . . . signed in the prescribed manner both by the debtor . . . and by or on behalf of the creditor . . ." It is clear that, notwithstanding what we have identified as the second part of section 127(3), the prohibition in the first part of the section does not prevent the making of an enforcement order in all cases where section 61(1)(a) has not been complied with. But the irreducible minimum requirement is that spelt out in the third part of the section. No enforcement order can be made unless there is a document signed by the debtor which contains all the prescribed terms of the agreement. We can see no way in which it is possible to read and give effect to section 127(3) of the 1974 Act which avoids that irreducible minimum requirement; and none has been suggested to us in argument. Nor can we see any way in which it is possible to read and give effect to

[Ruby]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

Hi Curlyben, what do you mean pre 2005 in you last post? I thought it was pre April 2007?.

[Harrased]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

Hi,

I have an ongoing dispute with MBNA / Restons in which I asked for a copy of a credit agreement which bears my signature. Stressing that my request was NOT made under pursuant to section 78 of the Consumer Act 1974 but made pursuant to the to the Civil Procedures Rules (Pre action protocols and part 31.16) and therefore an unsigned copy would not suffice, only a copy of the original contract in its unaltered form would suffice in these circumstances.

However, Restons have cited Carey v HSBC in response stating a photocopy of an agreement with just my name and address in it does suffice under section 78 CCA?

As my request was made under CPR and NOT CCA does Carey v HSBC stack against me?

[cymruambyth]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

Hi should Curlben's excellent letters be amended to take this ruling into account?

[Amethyst]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

Yip nudge nudge

[cymruambyth]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

Ahhhh, thank you

[basa48]

Re: CAREY v HSBC - CCA Judgments 23rd Dec - re recreated docs

In addition to 'Ihaterbs's excellent observations, I would like to add my own interpretation of Waksman:

1. HHJ Waksman clarified the requirements for documentary evidence pursuant to s78 and s61 with reference to so called ‘reconstituted’ copies of agreements in Carey v HSBC (supra) where he said:

1. This judgment deals with two matters concerning requests for copies of credit card agreements pursuant to section 78 of the Consumer Credit Act 1974 (“the Act”) and the consequences of non-compliance with that provision.

2. The purpose of this judgment is to give general guidance, in the context of the cases before me, in the hope that this will narrow or eliminate the issues arising in the hundreds of other similar claims issued in County Courts around the country, many of which have been stayed pending the outcome here.

43. The issue here is this:
(1) When providing a copy of an executed agreement in response to a request under s78(1) of the Consumer Credit Act 1974:

(a) Must a creditor
(i) provide a photocopy (or other form of complete copy) of the original agreement that was signed by the debtor or at least provide a copy which is derived directly from the original agreement or complete copy thereof, or
(ii) can a creditor provide a document which is a reconstitution of the original agreement which may be from sources other than the actual signed agreement itself?
(b) Must a creditor provide a document which would comply (if signed) with the requirements of the Consumer Credit (Agreements) Regulations 1983 as to form, as at the date the agreement was made in order to comply with s78?

2. Judge Waksman then talks at length in relation to copy documents supplied under s78 about ‘Proof Purpose’ as distinct from ‘Current Information Purpose’.

44. It is common ground that the purpose of s78 is (at least) to provide the debtor with information as to the terms of the agreement with the creditor, as well as a present statement of his account and future obligations insofar as they are known. Beyond that common ground, however, the parties have adopted very different positions. The Claimants (debtors) say that the information is both as to the present and the original position under the agreement, and the reason for having the information about the original agreement is so that the debtor may be satisfied that he did indeed enter the agreement by signing a document which was a properly executed agreement (“the Proof Purpose”). On the other hand, the Defendants (creditors) say that it is a question only of providing current information, that is, information about the current terms of the agreement along with current financial details (“the Current Information Purpose”).

3. He then confirms he doesn’t consider the s78 document as Proof Purpose for s61.

53 (3) Once it is accepted that provision of a photocopy to the debtor is not required and that the signature may be omitted, it is not clear why the purpose is not simply information as to what the agreement contained as opposed to proof of its making;

(11). It is said that if the debtor cannot have a copy in the sense required (for the most part) by Mr Uff and Mrs Thompson then he is at a disadvantage should he wish to challenge whether he made a properly executed agreement at all. I do not agree. First, this point only has real force if the Proof Purpose underlays s78 and I do not think that it does. Second, it assumes that there is no obligation on the debtor to make out at least some sort of positive case as to improper (or non-) execution of the original agreement. If he does and for example asserts positively that although he has been using a credit card agreement for years he never actually signed an agreement, or one that complied with s61, the creditor may well have to try and find the original in order to deal with that allegation. (I deal further with the absence of such positive allegations in relation to s61 when I consider below the Applications.) But that tells one nothing about the scope of s78;

(13) I have already adverted to the overarching purpose of the Act being consumer protection within the ambit of a new and consistent framework which has benefits for lenders, too. But that does not impel a conclusion that the purpose of s78 must be the Proof Purpose.

(14) Mrs Thompson submitted that the approach she advocated with Mr Uff was not merely dependent on the Proof Purpose but also followed from the language of s78. But I do not accept that the language here impels that result and all the factors already mentioned point away from it.

54. Accordingly, the copy need not be as contended for by Mr Uff and Mrs Thompson and instead, a creditor can satisfy its duty under s78 by providing a reconstituted version of the executed agreement which may be from sources other than the actual signed agreement itself.

62. Mr Uff in particular contended that this was not s78 compliant because the name and the address did not come from the executed agreement. He said that the copy had to be of that document which on its face tied itself to the debtor. Only in that way could the debtor be assured that agreement was indeed to be attributed to him because the name and address on it was reproduced directly on to the copy. But this argument depends on the correctness of the Proof Purpose being the driver behind s78 and the Copies Regulations, which I have rejected. On the other hand, it is not as if the provision by the creditor of the name and address from its records is not of some value to the debtor. It at least indicates that the creditor has a record of the fact of this person at an identified address making an agreement at some point in the past.

63. The question is “Must a creditor provide a document which would comply (if signed) with the requirements of the Consumer Credit (Agreements) Regulations 1983 as to form, as at the date the agreement was made?” and the answer to be given is “No”.

105. I see no difficulty in saying that the framers of the Act saw it as important in the interests of debtors that they should able to obtain a copy of the agreement they made for whatever purpose they want, it being assumed that they ask for a copy because they have mislaid their own, and then, if in fact the agreement has been varied, they are given the up to date terms as well. This is what Options A and B are designed to do, more or less elegantly. The fact that the purpose of s78 falls short of the supply of proof or the best evidence possible of the executed agreement does not undermine this.

199. ………(omitted for clarity)……. I have already held that the purpose of the s78 copy is not to provide proof. ……..(omitted for clarity)…..

2. In my opinion this confirms that Judge Waksman concluded that any documents including ‘reconstituted documents’ supplied in response to s78 cannot to be considered ‘Proof Purpose’ of an executed agreement, they are for ‘Information’ only, i.e. ‘reconstituted’ agreements do not provide proof of compliance with s61.


3. Judge Waksman then describes what documents he thinks do constitute an executed agreement for the purposes of s61:

171. This arises solely in connection with s61(1)(a) and the requirement thereunder that the document signed by the debtor “contains” all the Prescribed Terms . The question is as follows:
“Does the document signed by the debtor contain the Prescribed Terms for the purposes of section 61 and/or section 127(3) if:

(a) they are on a sheet which is referred to on the piece of paper that was signed by the debtor; or
(b) where that sheet is attached to the piece of paper signed by the debtor; or
(c) where that sheet is separate from but was supplied with the piece of paper signed by the debtor?”

173. The parties in Carey have helpfully agreed the following principles. The fourth one was added by Mr Uff, with their agreement. No other party takes issue with them. The OFT has formulated the matter in a slightly different way but accepts these principles are close to its position.

(a) It is not sufficient for the piece of paper signed by the debtor merely to cross-refer to the Prescribed Terms without a copy of those terms being supplied to the debtor at the point of signature;
(b) A document need not be a single piece of paper;
(c) Whether several pieces of paper constitute one document is a question of substance not form. In particular a physical connection between several pieces of paper is not necessary in order for them to constitute one document;
(d) Additionally, a physical connection (or one or more physical connections) between several pieces of paper does not necessarily constitute them as one document;
(e) Accordingly, where the debtor’s signature and the Prescribed Terms appear on separate pieces of paper, the questions of whether those pieces of paper together constitute one document is a question of substance and not form.

174. As a matter of law, those principles appear to me to be correct, in the context of s61.


6. Also Reg. 7 of Consumer Credit (Cancellation Notices and Copies of Documents) Regulations 1983 makes further provision in respect of copies where the agreement has been varied under the heading “Copies of agreements or security instruments where the agreement or security instrument has been varied”“

(1) Where an agreement has been varied in accordance with section 82(1) of the Act, every copy of the executed agreement given to a debtor, hirer or surety under any provision of the Act other than section 85(1) shall include either—
i. an easily legible copy of the latest notice of variation given in accordance with section 82(1) of the Act relating to each discrete term of the agreement which has been varied; or
ii. an easily legible statement of the terms of the agreement as varied in accordance with section 82(1) of the Act”.

7. Judge Waksman discusses this as:

69. “If an agreement has been varied by the creditor under a unilateral power of variation, is a copy of the executed agreement as varied, a sufficient copy for the purposes of section 78(1), or must the creditor provide a copy of the original agreement as well?”

and after lengthy argument, concludes:

108. Accordingly, I conclude that Reg. 7 requires a copy of the executed agreement in its original form as well as a statement of the terms as they are at the time of the request.