Invalid Default Notice

[neio]

Hi,
I would appreciate your advice on the following. I received a Default Notice yesterday which looks OK apart from the following sections:

Which part of the agreement have I broken?
Clause 2.1 of your Credit Card terms and conditions contains details of the minimum payment you must make each month.

How have I broken the agreement?
You are in breach as you failed to pay the due amount in accordance with clause 2.1 of the terms and conditions and arrears of £0.00 are outstanding.

What do I need to do to correct this?
You must pay us £0.00 into your above numbered credit card account by <date given>.

They state the outstanding balance in the DN but the arrears are listed as £0.00. Surely it is invalid as it does not correctly state what I need to do to correct the default. What are the implications if they terminate the agreement based on this?

Regards

Neio

[mystery1]

Re: Invalid Default Notice

They will proceed as if they can terminate but the point you make, if made in court, should be enough to defend any claim, barring any newer correct default notice.

M1

[FORCEOFONE]

Re: Invalid Default Notice

If this ever got to court, and was brought up in a defence

All the creditor will do is withdraw the claim, issue a compliant Default Notice, wait for the 14 days to expire

Then issue a fresh claim through the courts

[mystery1]

Re: Invalid Default Notice

It'd cost them to withdraw.

M1

[neio]

Re: Invalid Default Notice

If this ever got to court, and was brought up in a defence

All the creditor will do is withdraw the claim, issue a compliant Default Notice, wait for the 14 days to expire

Then issue a fresh claim through the courts

Thank you both. But does it still hold true that if they terminate the agreement based on this invalid DN that they cannot then issue a new DN? As there is not an agreement in place to allow them to do this as it was unlawfully terminated by them.

[FORCEOFONE]

Re: Invalid Default Notice

A creditor does not have to terminate an agreement to issue a claim through the courts

A creditor will terminate so he can demand sums not yet due

An agreement cannot be terminated, then enforced on a Defective Default notice

[FORCEOFONE]

Re: Invalid Default Notice

It'd cost them to withdraw.

M1

Can you be so kind as to elaborate please M1, for my own education

[neio]

Re: Invalid Default Notice

A creditor does not have to terminate an agreement to issue a claim through the courts

A creditor will terminate so he can demand sums not yet due

An agreement cannot be terminated, then enforced on a Defective Default notice

OK but say if they do terminate the agreement after the default notice period expires (and I accept the termination)? Can they still issue another DN?

[FORCEOFONE]

Re: Invalid Default Notice

Yes they can IF THE PREVIOUS DEFAULT NOTICE WAS DEFECTIVE

YOU CANNOT TERMINATE ON A DEFECTIVE NOTICE

[mystery1]

Re: Invalid Default Notice

Can you be so kind as to elaborate please M1, for my own education

http://www.justice.gov.uk/courts/pro...art38#IDAME0HC

M1

[FORCEOFONE]

Re: Invalid Default Notice

Thanks

I was trying to confirm at what stage of litigation costs become an issue,

Before or after a Defence was submitted as an example

[mystery1]

Re: Invalid Default Notice

As soon as a claim is entered as far as i'm aware.

It seems sensible that a court cannot make an order for costs when it has not been involved and it also seems sensible that a defendant does not sit on his hands once served with court papers which would naturally entail costs.

M1

[neio]

Re: Invalid Default Notice

As soon as a claim is entered as far as i'm aware.

It seems sensible that a court cannot make an order for costs when it has not been involved and it also seems sensible that a defendant does not sit on his hands once served with court papers which would naturally entail costs.

M1

Hi, They are now requesting full payment of the balance via their solicitors now within 14 days or further action will be taken. So they believe they have terminated the agreement based on the dodgy default notice they served. What are my options here. I want to take legal advice from a solicitor but am concerned about the costs. Can I only claim the costs if this goes to court? I understand that I am liable for the debt regardless of what happens so the ideal outcome for me would be if I can avoid the default and bring the account back in order without additional costs to myself. Is it best that I just write to them and inform them that the default was invalid and make them aware if they continue to enforce based on this that I will take them to court or counter claim? Really appreciate your advice on this.

[FlamingParrot]

Re: Invalid Default Notice

I'm sorry you didn't get a reply earlier but some of us have been unable to access the site over the past few days.

Hi, They are now requesting full payment of the balance via their solicitors now within 14 days or further action will be taken.

Can you post up the letter you have received after removing your personal details? It could be a letter of claim and if so, you need to respond appropriately, an appropriate response can stave off court action. But it could also be a standard threat so we need to know more. :typing:

So they believe they have terminated the agreement based on the dodgy default notice they served. What are my options here. I want to take legal advice from a solicitor but am concerned about the costs. Can I only claim the costs if this goes to court?

You are rushing a little here, you are not in court yet. You can't just pay for legal advice and expect to claim your costs back, if that was the case, we'd all be doing it! If it went to court, it would be up to the court to award costs, but they would likely be limited to the costs incurred in defending the claim once it was issued, rather than any other costs incurred long before legal action had started. :ohwell:

I understand that I am liable for the debt regardless of what happens so the ideal outcome for me would be if I can avoid the default and bring the account back in order without additional costs to myself. Is it best that I just write to them and inform them that the default was invalid and make them aware if they continue to enforce based on this that I will take them to court or counter claim? Really appreciate your advice on this.

Absolutely not! The days when debtors took creditors to court to have their accounts ruled unenforceable are long gone! In any case, the accounts were ruled UE because of the lack of a properly executed agreement, not just on the basis of a faulty DN. A bad DN could help your case if this went to court, but if you make them aware that the DN is faulty they could just re-issue.

Also you can't say they are 'continuing to enforce' because enforcement means obtaining a CCJ against you. As per McGuffick v RBS, enforcement does not include asking you to pay, passing to a DCA or recording a default with the CRAs, so they are not enforcing it.

It would help if you told us a bit more about this account, who is the creditor? Is there a DCA involved? Who are the solicitors writing to you? When did you open this account, was it before April 2007? Did you apply online? If so, was it before or after 2005?

Have you ever sent a CCA request to this creditor? All the above questions are relevant, there's a lot more to unenforceability than just a dodgy DN! :grin:

[neio]

Re: Invalid Default Notice

I'm sorry you didn't get a reply earlier but some of us have been unable to access the site over the past few days. Can you post up the letter you have received after removing your personal details? It could be a letter of claim and if so, you need to respond appropriately, an appropriate response can stave off court action. But it could also be a standard threat so we need to know more. :typing: See Attached

You are rushing a little here, you are not in court yet. You can't just pay for legal advice and expect to claim your costs back, if that was the case, we'd all be doing it! If it went to court, it would be up to the court to award costs, but they would likely be limited to the costs incurred in defending the claim once it was issued, rather than any other costs incurred long before legal action had started. :ohwell: Thank You

Absolutely not! The days when debtors took creditors to court to have their accounts ruled unenforceable are long gone! In any case, the accounts were ruled UE because of the lack of a properly executed agreement, not just on the basis of a faulty DN. A bad DN could help your case if this went to court, but if you make them aware that the DN is faulty they could just re-issue.

Also you can't say they are 'continuing to enforce' because enforcement means obtaining a CCJ against you. As per McGuffick v RBS, enforcement does not include asking you to pay, passing to a DCA or recording a default with the CRAs, so they are not enforcing it. Weeewe Well in the letter it mentions that they have cancelled my card but also they are requesting that I pay the full balance. I thought they could only do that once they have issued a Default Notice and terminated the account?

It would help if you told us a bit more about this account, who is the creditor? Is there a DCA involved? Who are the solicitors writing to you? When did you open this account, was it before April 2007? Did you apply online? If so, was it before or after 2005? It is a Lloyds Bank credit card. No DCA involved only the solicitor SCM. Not sure exactly when it was opened. Most likely around 2007. Anyway I can find out? It was applied for online.

Have you ever sent a CCA request to this creditor? All the above questions are relevant, there's a lot more to unenforceability than just a dodgy DN! :grin: I have never requested a CCA.

Thank you for your kind assistance - sorry for some reason the formatting is not working for me. My replies above were done in red but not showing.