Unenforceable agreement question.

[Surfer]

In August 2008 I entered into what I thought was a HP agreement with a franchised Toyota dealer but it was a Fixed Cash sum loan. This was not legible at the top of the agreement
I got made redundant in November 2008 and then made reduced payments of £135 via a DMP instead of £192. In August 2009 I received a properly executed Default Notice as I was unable to make my full monthly payment of £192 due to redundancy in 2008. At that time there were arrears of £421 as i had maanged to find some temporary work
In October 2009 I sent off a S77-79 request enclosing the £1 fee. I specifically requested a true and legible copy of my credit agreement. Toyota finance then sent me a copy of the agreement and nothing else. No T & Cs etc.
Just to add, prior to that in early 2009 I had verbally over the phone requested a copy of the agreement and the T & Cs as the dealer had not given me a copy. These were sent to me but on examination the first page at the bottom stated "page 1 of 2" whereas on the T & Cs page at the bottom it stated "Page 2 of 3". In essence the documents did not seem to tie up together.
Dredging my memory cells I seem to recall that the dealer had run out of application forms and had one faxed across along with the T & Cs and the T & Cs were on a seperate sheet which may acount for the discrepancy.
Also the terms and conditions refered to the loan as being secured on the vehicle but this is not stated on the original agreement which is a faxed agreement.
We have not missed making a payment except that the payment is lower however Toyota have decided to issue me with summons although they are in default as they never fulfilled all the requirements of my S77-79 request.
My aim is to challenge the summons on the grounds of unenforceabilty as the prescribed terms were not there and my S77/78 request was not complied with. Please advise if I may have a valid argument on "unforceablity" as I cannot afford a solicitor or get legal aid.
Also meant to add that at no time did they tell me how the settlement amount was calculated on the default notice not that it is significant.

[maruvian]

Re: Unenforceable agreement question.

Hi Surfer

The problem you have with this that there was a change in the law in 2007 and agreements that could not be enforced for missing prescribed terms etc now can. Whereas section 127 CCA used to stop these agreements being enforced, this was repealed and a court can now enforce an agreement that could not be enforced before.

[Surfer]

Re: Unenforceable agreement question.

Hi Surfer

The problem you have with this that there was a change in the law in 2007 and agreements that could not be enforced for missing prescribed terms etc now can. Whereas section 127 CCA used to stop these agreements being enforced, this was repealed and a court can now enforce an agreement that could not be enforced before.

So even if I never had sight of the T & Cs the document can be enforced? What about the fact that they never complied with my S77/78 request for a copy which shoudl have produced at the very least a copy of the T & Cs plus statement etc??

[maruvian]

Re: Unenforceable agreement question.

The fact that they have never complied with you CCA requests has always meant that the agreement could not be enforced, except by court order. Just look at the case where a cut up credit card was produced in court. In truth there is not much that judges won't enforce these days. The only thing that used to stop them was s 127 CCA now this has been reapealed then it is getting harder to get them ruled unenforceable.

This is how i see things other people may see it differently.

[frisp]

Re: Unenforceable agreement question.

I think your mistaken maruvian both of you have a look at the Carey case and see what is or is not permitted

[charitynjw]

Re: Unenforceable agreement question.

http://business.timesonline.co.uk/to...cle6995381.ece

Carey v HSBC Bank plc
and Associated Cases
Before Judge Waksman, QC
Judgment December 23, 2009
A creditor could satisfy its duty under section 78 of the Consumer Credit Act 1974, to give a debtor, when asked in writing, a copy of the running-account regulated credit agreement and other documents referred to therein, by providing a reconstituted version of the executed agreement, which might be from sources other than the signed version.
Judge Waksman, QC, sitting as a Queen’s Bench Division judge, so held in the Mercantile Court at Manchester, when considering six preliminary issues of law in eight selected cases concerning requests for copies of credit card agreements pursuant to section 78 of the 1974 Act: Emma Carey against HSBC Bank plc; Shafeel Younis against Barclays Bank plc; Samantha Conniff against Barclays Bank; Mohammed Adris against the Royal Bank of Scotland plc; Brian Backwell against the Royal Bank of Scotland; Rajan Mandal against the Royal Bank of Scotland; Andrew Light against MBNA Europe Bank Ltd; and Robert Atkinson against Bank of Scotland plc, with the Office of Fair Trading intervening in all cases. Additionally, two applications by the Royal Bank of Scotland and Barclays Bank that the claims of Mohammed Adris and Shafeel Yunis, respectively, had no real prospect of success and should be struck out were granted.
Mr David Uff and Mr James Malam for Carey, Conniff, Backwell and Light; Mrs Zoe Thompson and Miss Laura D’Cruz for Yunis; Mr Julian Gun Cuninghame and Mr Bradley Say for Adris, Mandal and Atkinson; Ms Sonia Tolaney and Mr James Macdonald for HSBC Bank; Mr Andrew Mitchell for Barclays Bank; Mr Bankim Thanki, QC and Ms Julia Smith for the Royal Bank of Scotland; Mr Geriant Howells for MBNA Europe Bank; Mr Fred Philpott for Bank of Scotland; Mr Stephen Neville for the Office of Fair Trading.
HIS LORDSHIP said that the purpose of his judgment was to give general guidance, in the context of the cases before him, in the hope that that would narrow or eliminate the issues arising in the hundreds of other similar claims issued in county courts around the country, many of which had been stayed pending the outcome in the proceedings before his Lordship.
His Lordship reached a number of conclusions on the preliminary issues:
First, a section 78 copy had to contain the name and address of the debtor as it was at the time of the execution of the agreement but the creditor could provide those details from whatever source it had of those details and not necessarily from the executed agreement itself.
Second, the creditor need not, in complying with section 78, provide a document which would comply, if signed, with the requirements of the Consumer Credit (Agreements) Regulations (SI 1983 No 1553) as to form, as at the date the agreement was made.
Third, if an agreement had 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.
Fourth, a breach by a creditor of section 78 did not of itself give rise to an unfair relationship within the meaning of section 140A of the 1974 Act, as inserted by section 19 of the Consumer Credit Act 2006.
Fifth, the court had jurisdiction to declare whether in a particular case, there had been a breach of section 78. It would depend on the circumstances of that case as to whether it would be appropriate to grant such a declaration.
Section 60 permitted regulations requiring prescribed terms to ensure that a debtor or hirer was made aware of the rights and duties conferred or imposed on him by the agreement, the amount and rate of the total charge for credit in the case of consumer credit agreements, the protection and remedies available, and any other matter which it was desirable for him to be aware of in connection with the agreement.
The following principles were correct in the context of section 61 in assessing whether those prescribed terms were “contained” in an executed agreement:
First, it was 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.
Second, a document need not be a single piece of paper.
Third, whether several pieces of paper constituted one document was a question of substance not form. In particular, a physical connection between several pieces of paper was not necessary in order for them to constitute one document.
Fourth, a physical connection, or one or more physical connections, between several pieces of paper did not necessarily constitute them as one document. Accordingly, where the debtor's signature and the prescribed terms appeared on separate pieces of paper, the questions of whether those pieces of paper together constituted one document was a question of substance and not form.
His Lordship held on the assumed facts of the first claim that the prescribed terms were so contained.
Solicitors: MSB Solicitors, Liverpool and BPS Solicitors, Manchester; Ascot Lawyers, Bracknell; Consumer Credit Litigation Solicitors, Manchester; Addleshaw Goddard LLP, Manchester; Lovells LLP; DLA Piper (UK) LLP, Manchester; Mr Howard Beale, Bank of America; SCM Solicitors, Brighton; Legal Department, Office of Fair Trading.

[Surfer]

Re: Unenforceable agreement question.

I am hoping to based my defence on the following points;

1) No T & Cs were attached to the agrement at trhe time of the agreement
2) At no time was i made aware that I was signing a cash loan instead of a HP agrrement (Any reasonable person buying from a franchised dealer would assume they are signing a HP agrrement. In this case no one could read the header on the agreemnt
3) They never complied with my S77/78 request.

Below is a copy of the letter I sent Toyota in December 2009.

After consultation with the Citizens Advice Bureau and with reference to the above agreement, I would be grateful if you could send me a true signed legible copy of this credit agreement. I understand that under the Consumer Credit Act 1974(section 77-99); I am entitled to receive a true copy of my credit agreement on request. I enclose payment of £1 that represents the fee payable under the Consumer Credit Act.

Although requested previously, all I have received is a copy of the agreement that was sent by fax to your offices. This copy of a fax is not a true copy of the agreement as per the CCA 1974 and does not clearly indicate that it is an agreement regulated by the Consumer Credit Act and neither does it clearly show what type of loan agreement it is, i.e. cash loan or H.P. an this could be in breach of the Consumer Credit Act 1974.

Until this dispute over the agreement is clarified and resolved to the satisfaction of both parties, no further action should be taken against the account holder while in it is dispute.
Yours sincerely.
Mr Surfer.



They only sent me a copy of the first page of the agreement. and as you can see the heading is not legible. No T & Cs copies were sent and neither was a statement sent. For this reason alone IMHO the summons is unenforceable. By appearing in court with this defence am hoping to suss out the judge on the enforceability of the actual agreement as per the above points 1 - 3.

BTW is there a link to the updated CCA as I keep finding the original CCA regulations? Also links to any case law would be appreciated.

[WendyB]

Re: Unenforceable agreement question.

Wouldn't it just have been easier to come to a payment arrangement with them to pay the debt off? You'd probably still have been defaulted but it might not have ended up in court. When it goes to court now, the Judge may still order you to pay up anyway, by reaonable affordable instalments. Getting the agreement declared unenforeable (if you do) doesn't make the debt go away.

[Surfer]

Re: Unenforceable agreement question.

Wouldn't it just have been easier to come to a payment arrangement with them to pay the debt off? You'd probably still have been defaulted but it might not have ended up in court. When it goes to court now, the Judge may still order you to pay up anyway, by reaonable affordable instalments. Getting the agreement declared unenforeable (if you do) doesn't make the debt go away.

Since I was made redundant in Nov 2008, we have always made a payment albeit lower than the requried amount and never missed a month. When I had temporary employment for 3 months until mid - Octo 2009 we paid the normal amount and kept Toyota Finance updated at all times. In December 2009 we went onto a Debt Management Plan as we could not make ends meet, Toyota Finance will not accpt the lower payment although they were fully aware of our situation. IMHO they arfe being very hard nosed about it and have now involved us with additional costs. The saying, "You can't get blood out of a stone" comes to mind.

[WendyB]

Re: Unenforceable agreement question.

make sure you point that out in your defence, as the Judge won't look kindly on them for not being more helpful to you given your financial situation. You've done all you can do then Toyota deserve whatever they've got coming to them....

[Surfer]

Re: Unenforceable agreement question.

make sure you point that out in your defence, as the Judge won't look kindly on them for not being more helpful to you given your financial situation. You've done all you can do then Toyota deserve whatever they've got coming to them....

One of the reasons why I want to give them some stick but to obviously do it with some foundation.

[goinggrey]

Re: Unenforceable agreement question.

You are missing a basic point here - issue of unenforceable or not does not apply since your agreement date is August 2008! It only applies to anything taken out before April 2007 - so you will not have any case

[WendyB]

Re: Unenforceable agreement question.

Actually its dated 15th August 2007...but nonetheless it is after April 2007 so the points laready made above will apply, I think, ref the Carey case etc?

[flashinghare]

Re: Unenforceable agreement question.

I think you are heading into a world of pain and disappointment if you continue along this path of unenforceability. I make a living out of dealing with Consumer Credit Law and I wish you the best of luck......... If i were a betting man (which I am), my money is on Toyota.

I think the finance company are being harsh and I can't understand as to why they would adopt such a high-handed attitude.

If you are truly having a hard time, CAB or debt advice IMMEDIATELY.

[goinggrey]

Re: Unenforceable agreement question.

I was taking my date from the start of the original post!
"In August 2008 I entered into what I thought was a HP agreement with a franchised Toyota dealer but it was a Fixed Cash sum loan."

But i note that it was signed August 07 in the scanned copy

Still irrelevant as Unenforceability only applies to agreements pre April 07