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

[Lord_Alcohol]

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

I'm really struggling to understand this. I thought the civil court system was for genuine disputes, but here we have a bank that has withdrawn its earlier action now that the debtor has brought its attention to the mistake, and it now reasserts its erroneous antics by pretending that the contract has been restored in order that it can legitimise an application for a court order for the balance. Incredible.

The fact remains that the "arrears" printed on the new DN is pure fantasy. Has the bank forgotten already that the contract was terminated by them last year and so no further breach of the agreement could possibly happen? Apparently they have. They now tell TMC that he is in arrears of contractual payments that they earlier refused to accept.

The DN is simply wrong. The arrears can only be the amount that should have been paid under contract up until termination last year. Presumably the new DN can be safely ignored, as the lender is attempting to reopen an agreement closed by mutual consent and without the other party's involvement?

I would think that the only equitable solution would be for TMC to pay whatever is due up to termination (which I think is largely done), and for the lender to reset the contract to the point at which they mistakenly terminated, in addition to the question of compensation. Alternatively, there is the unresolved argument that the agreement was terminated where there was no entitlement, so the only liability (as it is a regulated contract) is the contractual payments due before termination.

[toomanycalls]

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

LA

I'm a bit the same as you, I just cannot see how they can just wipe out the previous three default notices, two termination letters, court fees, land registry fees, solicitors fees, breaches of the bank lending code, oft guidance on debt collection and unfair relationships. Accordingly state the wrong amount outstanding and then just amend the POC and off they go again.

[toomanycalls]

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

I found this while trying to find out if they really could reissue.

"the court may allow an amendment whose effect will be to add... a new cause of action but only if the claim arises out of the same set of facts as are already in issue on a claim in respect of which the party applying for permission has already claimed a remedy in the proceedings."

As I see it, it would add a new cause of action but not arising out of the same facts because the original cause of action was defective.

Anyone agree?

[diddydicky]

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

I'm really struggling to understand this. I thought the civil court system was for genuine disputes, but here we have a bank that has withdrawn its earlier action now that the debtor has brought its attention to the mistake, and it now reasserts its erroneous antics by pretending that the contract has been restored in order that it can legitimise an application for a court order for the balance. Incredible.

The fact remains that the "arrears" printed on the new DN is pure fantasy. Has the bank forgotten already that the contract was terminated by them last year and so no further breach of the agreement could possibly happen? Apparently they have. They now tell TMC that he is in arrears of contractual payments that they earlier refused to accept.

The DN is simply wrong. The arrears can only be the amount that should have been paid under contract up until termination last year. Presumably the new DN can be safely ignored, as the lender is attempting to reopen an agreement closed by mutual consent and without the other party's involvement?

I would think that the only equitable solution would be for TMC to pay whatever is due up to termination (which I think is largely done), and for the lender to reset the contract to the point at which they mistakenly terminated, in addition to the question of compensation. Alternatively, there is the unresolved argument that the agreement was terminated where there was no entitlement, so the only liability (as it is a regulated contract) is the contractual payments due before termination.

i think you are "half " right LA but when you say the arrears can ONLy be the amount that should have been paid under contract up until termiantion last year is in fact ALSO wrong!

if the arrears claimed are only up until last year- and they are paid- then s89 will not be acheived since having paid these arrears- the debtor will STILL be in breach of the agreement for the arrears accumulated since last year (as the creditor is claiming now that the agreement was not terminated by virtue of his dodgy DN's

whichever way - the DN is clearly miles out in the amount it claims for remedy

and given that this is now their FOURTH attempt- i cant see the judge being overly impressed

i also think that much has to be argued against a creditor starting court proceedings BEFORE he has a cause of action and then simply "holding them over" the debtor until they go off and find a cause of action- there MUST be an argument there.

In normal circumstances the creditor serving a DN in march-- payable by 8 April - would then either on or after 8 April terminate demand payment in full- and then serve a notice of intended proceedings whereas in this case they have done it in reverse order!

[toomanycalls]

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

i think you are "half " right LA but when you say the arrears can ONLy be the amount that should have been paid under contract up until termiantion last year is in fact ALSO wrong!

if the arrears claimed are only up until last year- and they are paid- then s89 will not be acheived since having paid these arrears- the debtor will STILL be in breach of the agreement for the arrears accumulated since last year (as the creditor is claiming now that the agreement was not terminated by virtue of his dodgy DN's

Just to remind you, the true arrears on the original dn should have been about £800 which were paid a week after due. The termination letter was three months later after 3 payments of an agreed reduced amount of £60

whichever way - the DN is clearly miles out in the amount it claims for remedy

and given that this is now their FOURTH attempt- i cant see the judge being overly impressed

I agree, how can this not constitute an unfair relationship. They have acted as if its terminated, forced me to make decisions based on that fact and initiated court proceedings.

i also think that much has to be argued against a creditor starting court proceedings BEFORE he has a cause of action and then simply "holding them over" the debtor until they go off and find a cause of action- there MUST be an argument there.

There was ma case on CAG last week that was dismissed on this very issue that the proceedings started before a valid DN, same bank..

In normal circumstances the creditor serving a DN in march-- payable by 8 April - would then either on or after 8 April terminate demand payment in full- and then serve a notice of intended proceedings whereas in this case they have done it in reverse order!

Seems odd to me that the original termination was so much later.

What would you do? I'm thinking that I might write to them suggesting that they are clearly mistaken that a claim can commence before a right of action and this constitutes an unfair relationship and spell it out in detail, maybe point them to the case lost last week.

What do you think the chances of them withdrawing this and then reissuing another claim on the new dn. Would this fall into the same unfair trap?

[Lord_Alcohol]

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

Well I still don't see how any arrears can accrue on a terminated contract - "arrears" are missed contractual payments, which no longer exist once the contract is ended. The only possible amounts payable are either the actual missed contractual payments or the balance.

Unless, of course, the creditor uses a different interpretation of the word "arrears"?

[Lord_Alcohol]

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

Yes, diddydicky has made a good point - the creditor terminated last year then has apparently changed his mind in order to issue a new DN. This, at least, shows that DNs cannot be served where the contract has been terminated (which is what some of us knew all along in that other thread of Peter Bard's).

The new DN shows alleged arrears that cover the period when the contract was terminated.

The creditor now asserts that the contract is alive and kicking, but this cannot be the case as he has already told TMC that it is ended and TMC took him at his word. Indeed, the creditor has already attempted a court action on the basis that the contract is dead.

The DN is bad, but the contract is ended. This may mean that the creditor has, in fact, cancelled the agreement and we should look at S70 of the Act, and in particular S70(1)(b);

any sum, including any item in the total charge for credit, which but for the cancellation is, or would or might become, payable by the debtor or hirer, or his
relative, under the agreement or transaction shall cease to be, or shall not become, so payable

It may be that creditors, aware of their howling cockups in their bad DNs, now reopen contracts and serve new DNs in order to avoid S70. I would suggest that the contract has most definately been cancelled by the creditor, as his actions show, and therefore S70 should apply. TMC may even apply to get his previous payments refunded!!

BTW, S69 states that notices of cancellation may be served in any form - so why not as a bad DN?!?!

[basa48]

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

OK- I may get some flak here, but trust me I am trying to see how this would all work.

A creditor issues a dud DN and terminates. Months even years later realises he has issued a dud DN and the termination is ineffective.

So he writes that "as the DN was a dud our termination was ineffective and our agreement is still 'live'. Here is a new DN issued today giving you 14 days to remedy". The amount to remedy is (whatever was the proper arrears due at the time of the original dud DN).

s87 and the Regs DO NOT specify that the amount remedy must be the arrears, only that it can't be a sum not yet due (afaik) , it only specifies 'what action is required to remedy it and the date'.

They can put any sum to remedy. This seems to get them around the unpaid amounts during the 'ineffective termination' period.

[Lord_Alcohol]

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

OK- I may get some flak here, but trust me I am trying to see how this would all work.

A creditor issues a dud DN and terminates. Months even years later realises he has issued a dud DN and the termination is ineffective.

So he writes that "as the DN was a dud our termination was ineffective and our agreement is still 'live'. Here is a new DN issued today giving you 14 days to remedy". The amount to remedy is (whatever was the proper arrears due at the time of the original dud DN).

s87 and the Regs DO NOT specify that the amount remedy must be the arrears, only that it can't be a sum not yet due (afaik) , it only specifies 'what action is required to remedy it and the date'.

They can put any sum to remedy. This seems to get them around the unpaid amounts during the 'ineffective termination' period.

Basa - no flak from me. Like you, I'm feeling my way through all this with no clear direction.

I think the issue is the agreement, and whether it is dead or alive at the time of the new DN. I would say that it is dead, because that's what the creditor wants and he may well have taken steps that illustrate the termination, as TMC has found.

You are (I think) completely correct about S87 and it not stating "arrears", just an amount that must be paid. However, the point is that the agreement is ended (IMO), so the "amount" must be the contractual arrears or the balance. Try as I might, I cannot see any other amount that could be claimed.

If the agreement is ended, then it cannot be the balance because the creditor has no entitlement to claim it (S87(1)(b)). So that just leaves the contractual arrears.

Alternatively, the contract may be resurrected for the new DN, and if it is resurrected then contractual arrears would apply. But in itself this poses even more problems, because it ignores the creditor's earlier termination(s) and assumes that the debtor is happy for the contract to be reinstated.

As this is a regulated consumer credit agreement, the creditor and debtor both need to agree to the contract and also must agree to observe all the regulations. Otherwise it is a nonesense. But if one party terminates and then resurrects without the agreement of the other, what do we have? Chaos.

Similarly, I am utterly certain that the debtor would not be able to terminate the agreement and then resurrect it (unilaterally) at some future point, and expect all the contractual provisions to apply. On that basis, S140 should apply, as one party (the creditor) introduces bias into the relationship.

So I think that TMC would be well within his rights to assume that the earlier DN was a notice of cancellation, and that S70 now comes into play.

(Although I could of course be completely wrong).

[basa48]

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

As this is a regulated consumer credit agreement, the creditor and debtor both need to agree to the contract and also must agree to observe all the regulations. Otherwise it is a nonsense. But if one party terminates and then resurrects without the agreement of the other, what do we have? Chaos.

Similarly, I am utterly certain that the debtor would not be able to terminate the agreement and then resurrect it (unilaterally) at some future point, and expect all the contractual provisions to apply. On that basis, S140 should apply, as one party (the creditor) introduces bias into the relationship.

I think you may have an argument there LA - it takes two to tango .................................................. ....... and form a contract.

[Garlok]

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

Hi Guys,

I am much in agreement with LA on this as is Lord Justice Lloyd sitting in the Court of Appeal in 1993, where he stated:-

"what matters is not what the creditor himself intends, but what, by his words and conduct, he has led the [debtor] to believe"

Admittedly this case was a Common law contract case but I think gives an indicator as to the senior courts' thinking of the situation arising from the actions of creditors towards debtors.

regards
Garlok

[diddydicky]

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

OK- I may get some flak here, but trust me I am trying to see how this would all work.

A creditor issues a dud DN and terminates. Months even years later realises he has issued a dud DN and the termination is ineffective.

So he writes that "as the DN was a dud our termination was ineffective and our agreement is still 'live'. Here is a new DN issued today giving you 14 days to remedy". The amount to remedy is (whatever was the proper arrears due at the time of the original dud DN).

s87 and the Regs DO NOT specify that the amount remedy must be the arrears, only that it can't be a sum not yet due (afaik) , it only specifies 'what action is required to remedy it and the date'.

They can put any sum to remedy. This seems to get them around the unpaid amounts during the 'ineffective termination' period.

i dont think so

in order to serve a valid DN the creditor has to show not only that the debtor has breached a terms of the contract but what he must do " to put it right"

if the creditor himself terminated the contract/cancelled the agreement and told the debtor that he was no longer contracted to make monthly payments- then he can hardly claim in a Dn that the debtor had breached a term of the agreement (in respect of monthly payments that the creditor now claims were due since his (the creditors_ termination/cancellation) and refusal to accept monthly payments .

if the creditor now claims that the agreement was not terminated or cancelled- he nevertheless still told the debtor that monthly payments were no longer acceptable- therefore amending the terms of the agreement- and he still cannot (IMO) claim that the debtor has breached a term of the agreement which the creditor himself proposed to the debtor- should be disregarded

[toomanycalls]

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

Well blow me down, another DN has just turned up in the post today, this one dated the day after the last one with the same day to rectify, 8th April, again saying they may commence legal proceedings if not paid.. same figures.

[Amethyst]

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

I havent worked out yet from the thread if the figure on the DN is the figure for arrears TO DATE (as if the contract had continued) ? or just arrears to the date of the first DN ?


I'd like to see so if they send an incorrect DN and falsely terminate, when the problem is found out and they try to rectify they actually lose out on everything between times and the contract picks up where it left off so the debtor doesn't suffer any disadvantage and has the option to just start normal payments back up.

[Garlok]

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

Unfortunately Ame, I don't think that the contract/agreement can "just be picked up" where it left off. As diddydicky has said several times the damage has already been done to the debtor like trashed CRFs etc, the creditor has attempted to mislead quite deliberately the debtor by false and incorrect documentation. goodness knows they have had long enough to get it right!

There has to be remedy for that for the debtor. The Act's intention was clear in that should the creditor fail to observe the obligations imposed upon him by the Statute then it is quite right and proper that he should forfeit all right and benefits the agreement bestows upon him. If that is not the case then as I have argued some legal framework must come into play to provide remedy for the alleged debtor.

regards
Garlok