Default Re: Me V Bank - defective DN and unfair relationship defence.

[Pumpytums]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

"A bad notice cannot be remedied at trial or within 14 days of trial without leave of the court to allow the matter to be stayed

One point on this, if the arrears are paid then that would leave the Claimant needing to discontinue and pay the debtors costs of the action as he would have no cause of action"



Hi DD,
I think what PT was getting at if a creditor goes to court for enforcement and the DN is proven to be defective. The Claimant can then request a stay issue a new DN. After 14days they could then request the stay is removed and off they go again. However if the Defendant pays the arrears on the new DN (providing its correct) the Claimant would be left with no right of action the DN is satisfied.

Problem is if you then don't keep up payments on the agreement the Claimant could then issue a new DN and off we go again.

"A bad notice can be remedied during proceedings, as the arrears remain payable thus the cause of action remains and is not extinguished by the defective notice"


Another thing if proceedings are issued (I assume this is pre allocation) I don't under stand how a new DN can be issued at this stage. As the POC would be wrong, as they cannot claim the full balance until the DN expires.

Does PT mean that technically they could claim the arrears at court but not the full balance? But if you cough up then again the DN would be satisfied hence no cause of action.

I'm confused again.

Pumpytums

[diddydicky]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

one thing i have just argued, admittedly in the case of a debt purchaser not the original creditor, but they relied on a bad notice, they tried to serve a good notice but had failed to give effect to s86(a-d) of the CCA

so default sums and interest had been added to the balance, which meant it was a bad notice again.

Maybe we should put our minds to consider how best to defeat these things than arguing among ourselves? i cannot see how in light of HHJ Chambers QCs judgment, that it can be said that a creditor cannot reissue a notice,

i agree ...but the point is he said something along the lines of "in many cases it may be possible" - he did not say that it would be in ANY event

further, and importantly he did not define WHEN he thought the creditor could and could not do so!
------------------------------- merged -------------------------------

Well, often, what would my view be on that,

Well here goes,

A bad notice can be remedied at any point prior to proceedings.

A bad notice can be remedied during proceedings, as the arrears remain payable thus the cause of action remains and is not extinguished by the defective notice

A bad notice cannot be remedied at trial or within 14 days of trial without leave of the court to allow the matter to be stayed

One point on this, if the arrears are paid then that would leave the Claimant needing to discontinue and pay the debtors costs of the action as he would have no cause of action

So that is how i see it, and i was actually the file handler on Harrison, and was in court to hear judge chambers reasoning, so i speak from my own knowledge of this matter which gives us this judgment


Those are just my view, but i am aware of a number of cases where the courts albeit county court, have followed those lines.

Also if the matter is at trial, then one must also consider the issue of estoppal as the Claimant cannot restart a claim on the back of a defeat using the same facts

can you clarify one point

you say that if the debtor remedies the DN then the claimant would be liable for his costs

how would this work- since presumably the trial would be many months/A year or more AFTER the date at which the DN demanded payment of arrears?

surely the creditor would argue that he should not be penalised in costs simply because the debtor paid up at the court steps! when he could have avoided the claimants costs by paying up earlier

[Pumpytums]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

That sounds a bit severe to be honest, if you missed a single payment by 2 weeks they can demand the full balance. As it's lumped in with the applying for loan bit I think it's when the loan was set up have a re-read.

"If any amount payable by you for more than 14 days or if any statement or representation made by you in the course of applying to enter this agreement is found to be incorrect then you shall, if we so demand by written notice, immediately pay to us the amount to settle your loan."

I could well be wrong.

Pumpytums

[toomanycalls]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

Blooming heck that first bit is a little hard to understand could be me though. Looks like if you don't pay a setup fee within 14days or make a miss-representation in your application then the full balance can be demanded.

I read that as if I'm 14 days in arrears they can demand the full amount outstanding.

However as its a CCA then they still have to follow procedure as none of there terms can override Parliament.

[Pumpytums]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

Blooming heck that first bit is a little hard to understand could be me though. Looks like if you don't pay a setup fee within 14days or make a miss-representation in your application then the full balance can be demanded.

So it looks like their is no term that allows them to demand immediate payment for any reason (other than above). That's good no Brandon cop out. So in that case the CCA that the agreement was signed under apply's. So they should still have to send a compliment DN before demanding the full balance/terminating. So in my opinion if they have not done so they have created an unfair relationship. Namely they have failed to abide by the CCA 1974 that you both agreed the agreement was under.

Just my opinion. Have a read up on s140 it's quite potent.

Pumpytums

[toomanycalls]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

the thing to look at is the T&C of the agreement both parties signed for example there may be a term that states "Before making any demand we will take all the steps we are required to take by law for your protection".

So if they demand the full balance on a defective DN that you have pointed out to them and they continue to attempt enforcement have they not just broken the terms of the agreement? Have they not also fallen foul of s140a unfair relationships? Maybe a counter-claim would cheer them up a bit?

In this case the T&C state

"3 Right to demand earlier repayment
if any amount payable by you for more than 14 days or if any statement or representation made by you in the course of applying to enter this agreement is found to be incorrect then you shall, if we so demand by written notice, immediately pay to us the amount to settle your loan. If you have fallen behind with your payments we may pass information about what you owe us to a credit reference agencie. CRA record this information which may be seen by other companies you may apply to for a loan or credit and this may affect your ability to get credit."

[Pumpytums]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

Hi,
the thing to look at is the T&C of the agreement both parties signed for example there may be a term that states "Before making any demand we will take all the steps we are required to take by law for your protection".

So if they demand the full balance on a defective DN that you have pointed out to them and they continue to attempt enforcement have they not just broken the terms of the agreement? Have they not also fallen foul of s140a unfair relationships? Maybe a counter-claim would cheer them up a bit?

Again if they send a termination letter again haven't they broken the T&C?

Every time they demand the full balance have they not broken the T&C?

My opinion is that you both signed an agreement you both agreed to be bound by it the debtor gets more protection as they are more vulnerable. If the Creditor wishes to not be bound by the agreement that's their problem and something that should be pointed out.

I think with small claims if you can make the pill bitter enough the Claimant should back off they are not LIP and their legal bill is racking up every time you send a letter to their solicitor or get them to reply to letters. I think that's why the likes of Sunk Financial back-off if you defend it's not worth them shelling out to repeat court appearances that must be costing them £500 a pop.

As PT has stated s86A- is very useful as it required the creditor to send notices of sums in arrears. If they don't then the agreement ceases to exist temporarily for the time they fail to send notices. Basically the arrears can not build up or interest be charged during the period that the creditor fails to comply. Imagine I lent you £100 and we agree you will pay £10 a month, and I send statements each month, you fail to pay. I send you only a single arrears notice for £10 then 5 months latter send a DN stating arrears of £60 and I terminate the agreement. Basically the DN will be bad the interest cannot be added for the period I have not sent notices.

I'm not sure if the original arrears notice becomes invalid if it's left too long however. Also this may stop s69 interest as s86 clearly states all interest for the period of none compliance. May be worth a discussion.

I would imagine it would be very difficult once they mess it up for a creditor to produce an accurate DN if the account contains default sums as only simple interest is allowed on these. And as we know they always add compound.

UK Legal Documents, Legal Forms and Legal advice

Thanks

Pumpytums

[Lord_Alcohol]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

the problem you face is ignorance of the law is no defence,


which also presumably applies to a creditor serving a bad DN!!

the view of the creditors "spokesperson" that the creditor may not have realised that the DN was bad- therefore does not save him

(nor i suspect does the fact that the CCA requires the creditor to "act with precision" in the serving of the DN - and offers him no room for error!)

I agree totally. The comment from PT was in response to my post which merely asked what amount a second (good) DN could lawfully demand, after realisation that the first DN was bad.

This question remains unanswered (unsurprisingly!!) yet I do not see that it has anything to do with ignorance of the law. If anything, it is the creditor that is ignorant of the law in serving his bad DN when he should have known better. And let's keep in mind the considerable resources at the creditor's fingertips, and the simplicity of a DN...

I do not know why PT has left us - perhaps we are getting close to the truth and commercial considerations may come into play? Who knows? A reason would have been a big help.

I still consider that a lender that has terminated a contract (surely there is no longer any doubt that the contract is terminated?) without entitlement and eventually realises his mistake should seek an equitable outcome with the debtor. At a minimum, that should be reopening of the contract as it was, with a DN showing the correct amount of the original breach. Where the creditor has acted badly, then the issue of compensation should be considered.

I think just going to court and getting a new DN with a revised arrears for the intervening period is grossly unfair and should be the subject of a S140 claim from the debtor.

Just my opinion of course but Harrison may really point the way...

[volvodriver]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

I shall bow out of this thread and am subscribing from it.

I think that's most unfortunate.

It would be nice to know whether its because you now believe the view which you had is wrong, or because other posters on this thread with a different interpretation have failed to grasp a truth which renders their argument bound to fail.

Vdr

[New_Age_Biker]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

One point on this, if the arrears are paid then that would leave the Claimant needing to discontinue and pay the debtors costs of the action as he would have no cause of action


Also if the matter is at trial, then one must also consider the issue of estoppal as the Claimant cannot restart a claim on the back of a defeat using the same facts

Is there a tactic here which could be used to great effect?
Allow the claimant to get to trial or within 14 days of it.
Pay the arrears as appears on the faulty Dn
Claim costs as the creditor would discontinue
case then becomes estoppaled?

[pt2537]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

I shall bow out of this thread and am subscribing from it.

[Garlok]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

AND DD you have a common law ruling from the CofA (not superseded either as far I can tell) by Lloyd LJ in Stour Valley Builders whereby

"it matters not what the creditor intended, but what, by his words and actions he has led the debtor to believe".

regards
Garlok

[diddydicky]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

the problem you face is ignorance of the law is no defence,


which also presumably applies to a creditor serving a bad DN!!

the view of the creditors "spokesperson" that the creditor may not have realised that the DN was bad- therefore does not save him

(nor i suspect does the fact that the CCA requires the creditor to "act with precision" in the serving of the DN - and offers him no room for error!)

[diddydicky]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

Basa

This is certainly an argument that seems to be supported by the courts, even with Harrison (the judge considered that a new DN could be served). However, I have yet to see any conclusive argument that clearly shows that the agreement is not terminated.

S87 merely says "entitled to terminate". It doesn't say "the agreement is not terminated until". Maybe semantics, but to my mind that means the creditor may only terminate and expect the entitlements of the Act where he observes the regs, and nothing more than that.

That the creditor does in fact terminate is, to me, crystal clear. Otherwise I have dreamed the two years of threats from DCAs, the mock court papers, the endless phone calls, the banging on the front door and, importantly, the insistance that I pay the balance and not the contractual payments. To ignore this in order to serve a new DN is, in my view, taking the p**s.

The CRUX of the matter however- found in the HOL in Wilson and not superceded by any other judgement- is that it is not what the creditor thinks or writes to the debtor BUT WHAT THE DEBTOR BELIEVES THE CREDITOR TO HAVE SAID/DONE

thus if the creditor writes and acts towards the debtor- so as to envince him that the agreement is "terminated"- then terminated it is (IMO)

it matters not whether lawfully the agreement WAS terminated- since the creditor has persuaded the debtor to take decisions that he would not otherwise have taken and as i have said before- to suggest that the debtor cannot have been prejudiced by the creditors misleading/false information and actions- would be ludicrous

[pt2537]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

the problem you face is ignorance of the law is no defence, if the debtor dont know the creditor cant terminate without a valid notice then well that is in the eyes of the Court, going to be tough.

Also does the creditor face an estoppal situation where if he does indeed refuse to accept payments at that time, then he cannot recover them later? i do not know, i ponder the Lord Denning Promissory estoppal doctrine, but im not sure its a situation where that applies

Something to think on though