s.89 - what does it mean?

[jax50]

Re: s.89 - what does it mean?

Is it not
Re: Default Notice Delivery Allowance

The Service by Post issue is covered by The Interpretation Act 1978, but that was clarified by the Senior Master in a Practice Direction in 1985:

Quote:
Council Tax Manual - Section 3 - Appendix 3.6 - Service of documents by post

Appendix 3.6 - Service of documents by post

All Text Amended

1. Interpretation Act 1978, Section 7

This states:-

"7. Where an Act authorises or requires any document to be served by post (whether the expression "serve" or the expressions "give" or "send" or any other expression is used) then, unless the contrary intention appears, the service is deemed to be effected by properly addressing, pre-paying and posting a letter containing the document and, unless the contrary is proved, to have effected at the time at which the letter would be delivered in the ordinary course of post."

2. Practice Direction

Service of Documents - First and Second Class Mail

"With effect from 16 April 1985 the Practice Direction issued on 30 July 1968 is hereby revoked and the following is substituted therefore.

1. Under S7 of the Interpretation Act 1978 service by post is deemed to have been effected, unless the contrary has been proved, at the time when the letter would be delivered in the ordinary course of post.

2. To avoid uncertainty as to the date of service it will be taken (subject to proof to the contrary) that delivery in the ordinary course of post was effected:-

(a) in the case of first class mail, on the second working day after posting;

(b) in the case of second class mail, on the fourth working day after posting.

"Working days" are Monday to Friday, excluding any bank holiday.

3. Affidavits of service shall state whether the document was dispatched by first or second class mail. If this information is omitted it will be assumed that second class mail was used.

4. This direction is subject to the special provisions of RSC Order 10, rule 1(3) relating to the service of originating process.

8 March 1985
J R BICKFORD SMITH Senior Master
Queen's Bench Division

[patrol30]

Re: s.89 - what does it mean?

Ok i will rephrase that, there is no consequence to the lender getting the default notice wrong. The general opinion is they can issue a hundred notices until they get it right. But i am with teaboy2 with the view that if they sell it on then i pay my arrears, they need to give me my card back and that will lead to some interesting problems.

[jax50]

Re: s.89 - what does it mean?

As a matter of interest, when the DN states 28 days days to pay the outstanding balance or else, if you haven't paid the arrears within the time frame given, is the 28 days the date from the letter (as they state) or is it 28 days plus time allowed for delivery ?

I think I concur you need more than a slightly defective DN though, relying only on that really would be risky so I'm not sure we'll ever see it tested in Court and then see what happens when a DCA is faced with needing to provide the terms of the contract by re-issuing the credit card. Maybe they would try and sell it back to the OC.

[jax50]

Re: s.89 - what does it mean?

Ok, so my OC sold to a DCA on the back of a defective DN. For some years the DCA has collected payments, but meanwhile I have been disputing charges made prior to the DN with the OC. Now the OC agrees to refund, and this they will do by buying back part of the account to adjust the outstanding amount.
Regardless of the methodology, what the refund does is reduce the o/s balance to below the credit limit and cover the arrears due from the DN.

So, where does this leave me ? The OC and DCA have previously demanded the full amount ..but now, in retrospect (ignoring the defective DN) this should not have happened.

I can't get my head round this.

[teaboy2]

Re: s.89 - what does it mean?

Sinces its the in house DCA and it has not had absolute assignment to a 3rd party (Sold to a DCA) then the inhouse DCA demands is simply that of the original creditor demanding ful payment post termination, basically they can not demand full payment until after the remedy date of the DN, nor are they permitted to terminate before date of remedy. But to demand full payment like they have implies they have terminated as only once they have terminated can they make a demand for full balance. Therefore DN is ineffective as the creditor is in breach of section 88 (2) (Which clear states "The creditor or owner shall not take action such as is mentioned in section 87(1) before the date so specified"), which as a result means their in breach of 87 (1) which forbids them from demanding earlier payment of any sum, as such the DN is defective as they might as well have demanded the full amount in the DN when demanding it within the time for remedy on seperate paper, plus such demand puts them in breach of 88(2) by making a demand for earlier repayment of sums nut yet due, which they are prohibited from demanding under 88(2) and 87(1) until the date for remedy has already passed.

[jax50]

Re: s.89 - what does it mean?

Thanks Teaboy2. I am informed the DCA is in fact a 3rd party, and not the in house collector, it has already been with the in house collector after the initial issuing of the DN and subsequent termination, sorry I should have explained that clearer. The OC recently said they had retained option when it sold the account to to the external DCA to buy back part of the account. When the 28 days expired the in house collector wrote asking for the full amount, and then when it was sold the DCA they also wrote and asked for the full amount. I didn't know at this stage (well no one knew) that the DN was defective. But now the refund is to be applied and all the figures will be reduced (the OC says it will pay off the amount of the refund although I suspect this is just an accounting adjustment).

I suppose the refund should be retrospective to the date just before the DN was issued...in which case, the balance overdue would not have existed and the DN would/should never have been issued anyway? If I imagine myself back in time at this stage, then consider, as you have stated the sequence of events that followed...then I can see they have demanded sums which are not due because no DN should/would have been issued, regardless of the fact the DN was defective anyway.



I am already in dispute with the DCA over a CCA request which they have not complied with, it's a long story but I won't go through that as it isn't relevant to this scenario I'm faced with now.

Given what you have said above, what do you think will happen, or what should happen next ?

[teaboy2]

Re: s.89 - what does it mean?

So when you had the second DN and the DCA issued demand for full payment the account had been sold to that DCA? If sold then they sold the account prior to your 14 days remedy. That is the same as what MBNA did to me a few years ago and i threated to counter claim for unlawful repudiatation as they were not permitted to sell (selling an account amounts to termination) the account until after the full 14 days to remedy had passed. Not only that but if i had remedied and the account had been sold it will still be unlawful repudiation and a breach of section 89 as i would have been denied my right for the breach to be deemed as not having occured and therefore being able to obtain credit on the card/account as per before the default. So not only is the DN invalid if they sell/terminate prior to the 14 day remedy period passing (breach of section 88 (2)) but they have unlawfully repudiated as a result of denying you the right to rememdy and your rights under section 89 to have the default treated as not having occured had you remedied. You can easily argue you did not remedy as they had already repudiated the agreement by selling it, demanding full payment prior to your 14 days to remedy having passed and therefore denying you the right to remedy and to be able to continue to draw credit on the account as though the breach had never occured, as a result of them selling the account. Therefore their was no point in remedying and the account was put into dispute!

Your also probably right in theory regrding the refund and whether the default should still stand as a result.

[jax50]

Re: s.89 - what does it mean?

So when you had the second DN and the DCA issued demand for full payment the account had been sold to that DCA? If sold then they sold the account prior to your 14 days remedy. That is the same as what MBNA did to me a few years ago and i threated to counter claim for unlawful repudiatation as they were not permitted to sell (selling an account amounts to termination) the account until after the full 14 days to remedy had passed. Not only that but if i had remedied and the account had been sold it will still be unlawful repudiation and a breach of section 89 as i would have been denied my right for the breach to be deemed as not having occured and therefore being able to obtain credit on the card/account as per before the default. So not only is the DN invalid if they sell/terminate prior to the 14 day remedy period passing (breach of section 88 (2)) but they have unlawfully repudiated as a result of denying you the right to rememdy and your rights under section 89 to have the default treated as not having occured had you remedied. You can easily argue you did not remedy as they had already repudiated the agreement by selling it, demanding full payment prior to your 14 days to remedy having passed and therefore denying you the right to remedy and to be able to continue to draw credit on the account as though the breach had never occured, as a result of them selling the account. Therefore their was no point in remedying and the account was put into dispute!

Your also probably right in theory regrding the refund and whether the default should still stand as a result.

Thanks teaboy2. When the OC issued the DN (which was defective anyway but not known) and then terminated after 28 days, they passed the account to the in house collector. They in house collector then wrote to ask for the full amount, or ways of paying off the full amount. After 2 years they sold the account to the 3rd party DCA in absolute. The DCA then wrote me asking for the full amount, or ways of paying off the full amount. There was only one DN issued, by the OC, and only after the 28 days period had passed did they terminate and pass on for collection.

No one demanded anything before the 14 days or 28 days had expired...nor was it sold before those time periods lapsed. I don't think I can argue I did not remedy because it was sold, because it wasn't sold before the 28 days had lapsed. My query relates to what would or should have happened had the charges applied to the account not in fact been charged...as has now been conceded by the OC. Without these charges being applied no breach would have taken place...

When the charges are retrospectively refunded to the account, the breach will not have arisen, and as I see it the DN should be cancelled, the credit facility resurrected, my CRA file wiped clean...and the OC would have to retake ownership of the account from the DCA so that we go back to pre DN and all the contract terms are reinstated in full. That is in theory !

But what is the reality ? I have read if the OC does not reinstate the full contract within 7 days, then they are in repudiation.??

[teaboy2]

Re: s.89 - what does it mean?

Well if the DN was defective then they were not entitled to terminate therefore the termination is invalid. But as they have sold the account, and if you can afford the actual arrears that where owed at the time the account was default, then tell the DCA the original DN was defective, therefore the creditor repudiated the agreement of the back of an ineffective/invalid DN notice in breach of section 87 (1). As such they are not entitled to the full amount unless the remedy the invalid DN. Then when they send you a new DN make sure its Valid and pay the arrears then wait for their next letter demaning the rest. Then hit them with a letter stating "DN dated xx/xx/xxxx was remedied to the sum of £xx on the xx/xx/xxxx therefore under the consumer credit act 1974 section 89 the breach is deemed as not having occured and the account should be returned back to its previous state before and default occured. i.e. credit and use of the account/card shouldbe fully restored. As it has not been then you (the DCA) are in breach of section 89 and have denied me my satutory rights under the regulated credit agreement. Your actions therefore amopunt to unlawful repudiation of contract and as such all you are entitled to are arrears, as the only arrears on the account where paid when the DN was remedied, then no amount is owed.

[jax50]

Re: s.89 - what does it mean?

Well if the DN was defective then they were not entitled to terminate therefore the termination is invalid. But as they have sold the account, and if you can afford the actual arrears that where owed at the time the account was default, then tell the DCA the original DN was defective, therefore the creditor repudiated the agreement of the back of an ineffective/invalid DN notice in breach of section 87 (1). As such they are not entitled to the full amount unless the remedy the invalid DN. Then when they send you a new DN make sure its Valid and pay the arrears then wait for their next letter demaning the rest. Then hit them with a letter stating "DN dated xx/xx/xxxx was remedied to the sum of £xx on the xx/xx/xxxx therefore under the consumer credit act 1974 section 89 the breach is deemed as not having occured and the account should be returned back to its previous state before and default occured. i.e. credit and use of the account/card shouldbe fully restored. As it has not been then you (the DCA) are in breach of section 89 and have denied me my satutory rights under the regulated credit agreement. Your actions therefore amopunt to unlawful repudiation of contract and as such all you are entitled to are arrears, as the only arrears on the account where paid when the DN was remedied, then no amount is owed.

Thanks teaboy2.

That all makes sense to me, I can follow that logical sequence you have said there...

Thing is, what would I do first ? Would I wait for the refund from the OC to be made, or would I tell the DCA now about the defective DN ?

The reason I ask this is because if I inform the DCA about the defective DN etc and they (the DCA) issue a new valid DN and advise me the amount to remedy, say £1,000, in 14 days, then I could write back and say that the refund agreed by the OC (of £1,000) will remedy the breach and as such the DN is remedied, without me actually paying anything. Then the sequence of events you have described above play out...although I'm not sure, when faced with the repudiation, what the DCA might do next...could they sell it, return it to the OC, or is it permanently and forever 'done for' ?

Is this realistic, or fantasy land on my part ?

[teaboy2]

Re: s.89 - what does it mean?

If the refund covers the original Arrears wait for that first - Then we can go from there as you likely won't owe anything!

[jax50]

Re: s.89 - what does it mean?

Thanks very much teaboy2 for your time , and patience, with this. very much appreciated believe me.

I was told by the OC they would deduct the refund from the outstanding balance.. they will no doubt insist that the 'arrears' were still not remedied...and thus I am still in breach, as I have missed the 14 days deadline. This I guess this will be where I say yes, but...the DN was defective..and as such you would need to re-issue, with the revised figures including the refund.? The payment of the refund must surely be offset against the 'arrears' as well as the outstanding balance, although I can see them arguing this is not the case as they will see how this could pan out for them. I'm not sure how this would play out, some say the refund should be sent directly to me, and not offset...and in that case I could indeed 'pay the arrears', but by the OC making the adjustment directly I do not have the option to actually 'pay'.

The clearing of the arrears on the revised DN is obviously the key to what you have described, and I wish I had the money to do it, but I haven't so am relying on the refund to do this for me. It will probably end up as an argument about how the refund is 'paid' by the OC.

I am assuming it is the arrears that triggers the breach, and the subsequent demand for the outstanding balance..so merely reducing the o/s balance doesn't satisfy the arrears issue, unless I can argue the point that any form of 'credit' to the account, wherever that comes from, must be shown as a 'payment'... but I can foresee problems with this.

The OC will say that having only made minimal notional payments, I have not actually paid anything that makes up the refund...so why should I get cash for it...worry worry...!



I have complained to the OC about the refund being credited directly, and not sent to me by cheque, but they are having non of it..insisting their right to buy back from the DCA an element of the debt. If it was a PPI claim, I don't think the issue would arise.

[teaboy2]

Re: s.89 - what does it mean?

Yes it would offset the original arrears. But we still need a valid DN, where you can then say well, hang on the arrears where paid when the refund was issued so Valid DN would have been remedied instantly upon it being issued. Then procede with Unlawful Repudiation. Put it this way they can not issue the refund to the account then claim you still owe the arrears, as they can't have it both ways! So actually go ahead and ask for the new DN so long as you know the refund will be paid withing the 14 days deadline to remedy that you will get on the new DN.

[jax50]

Re: s.89 - what does it mean?

Yes it would offset the original arrears. But we still need a valid DN, where you can then say well, hang on the arrears where paid when the refund was issued so Valid DN would have been remedied instantly upon it being issued. Then procede with Unlawful Repudiation. Put it this way they can not issue the refund to the account then claim you still owe the arrears, as they can't have it both ways! So actually go ahead and ask for the new DN so long as you know the refund will be paid withing the 14 days deadline to remedy that you will get on the new DN.

Hmm, thanks..Am hoping maybe I will be notified of the 'new balance' when it is done..but probably not before i expect. So maybe after the refund I would give them a shout about the DN, and see what they come up with...should be interesting ...

[ncf355]

Re: s.89 - what does it mean?

Having read this, can I get my situation absolutely crystal clear before I consider my course of action?


O.C issues invalid default (completely invalid, dates, amounts, the lot)
O.C sells account to DCA
DCA immediately issues court action

NCF defends on basis of defective default and also lack of legible, enforceable agreement

NCF wins, judge dismisses DCA claim


Around same time (only recently discovered, happened 4 years ago), NCF credit report has a DF applied for a period of 6 months, but this continues to be updated to CRA


So,

if I've got this right (via S89 and other sections)-

O.C should buy back account and issue fresh, valid default as DCA is not in the position to extend the facilities offered by the store card the agreement applied to?

In addition, DCA has royally screwed up by trashing my credit file with an unlawful DF?