Confusion about cause of action on statute barred account

[MikeG]

Hi everyone

A slightly confused newbie after a little bit of advice.

Back in 07 I took out a loan with Black Horse Finance. I was working at the time but in March 08 I lost my job. I had paid the monthly payments on time every time up until my last payment to them on the 17th of June 08. No other payment or contact has ever been made with them from that point.

When I have looked at my credit reports previously, this account has been showing as defaulted. Last week, I received a letter from a Solicitors saying that they will take me to court over this matter. Due to the time scales involved I sent them the Statute Barred letter asking them to prove that it isn't.

Today I have received a letter from them saying "We are instructed that in this case the cause of action accrued when the agreement was terminated on 22/03/2011." The letter goes on to say that if I disagree, "to set out the precise legal basis giving the date on which you believe the debt became statute barred. Alternatively, we invite you to withdraw your defence and put forward repayment proposals."

As I have mentioned this account was showing as defaulted from 2008 but looking at my Experian credit report, the account has dropped off and is not showing anymore.

I am just wondering how or if I should reply to this letter.

Many thanks for taking the time to read this.

[R0b]

Re: Confusion about cause of action on statute barred account

In simple terms, cause of action simply means the time in which the limitation period starts (usually 6 years for these debts). Now I'm sure the more experienced guys could give a better answer but it could depend on how much Blackhorse defaulted you on, whether it was the full sum of the loan or just for the missed payments. If it was for missed payments and not the whole amount then I would say that would be statute barred.

however if they agreement was terminated in 2011 they then accelerated the remaining balance, my initial thoughts would be that it would not al one statute barred. I presume on the majority of occasions the lender terminates the agreement after default is applied on the credit report? So it would be a bit strange to terminate the agreement 3 years later, or maybe I'm wrong.

[mystery1]

Re: Confusion about cause of action on statute barred account

Your credit report means very little.

When did they accrue a cause of action, then add 6 years. The answer could lie in either the agreement and/or default notice.

M1

[Amethyst]

Re: Confusion about cause of action on statute barred account

Your credit report means very little.

When did they accrue a cause of action, then add 6 years. The answer could lie in either the agreement and/or default notice.

M1

By way of example, this is a section from another blackhorse Loan CCA



This tells you when they are entitled to terminate /default/ enforce the entire agreement.

So ' we may terminate this agreement by written notice if you fail to make any Repayment on its due date'

So in essence the cause of action would have been 17th July 2008 ( as that was the due date of a payment you didn't make and therefore entitled them to take further actions ). Then even if they sent a default notice (14 days) and it wasn't complied with, then they terminated the account giving 7 days notice ..... it would bring it to potentially mid/end August 2008, so still statute barred.

The onus is on the creditor to evidence it is not statute barred, not on you to evidence that it is, so I wouldn't get into legal arguments by letter with the solicitors, I'd reiterate your final contact/acknowledgement/payment date, and formally request a copy of the agreement, termination and default notices and transaction lists of the account between inception and today.

[mystery1]

Re: Confusion about cause of action on statute barred account

By way of example, this is a section from another blackhorse Loan CCA



This tells you when they are entitled to terminate /default/ enforce the entire agreement.

So ' we may terminate this agreement by written notice if you fail to make any Repayment on its due date'

So in essence the cause of action would have been 17th July 2008 ( as that was the due date of a payment you didn't make and therefore entitled them to take further actions ). Then even if they sent a default notice (14 days) and it wasn't complied with, then they terminated the account giving 7 days notice ..... it would bring it to potentially mid/end August 2008, so still statute barred.

The onus is on the creditor to evidence it is not statute barred, not on you to evidence that it is, so I wouldn't get into legal arguments by letter with the solicitors, I'd reiterate your final contact/acknowledgement/payment date, and formally request a copy of the agreement, termination and default notices and transaction lists of the account between inception and today.

If the poster has that i'd definitely point it out. If they take action after having had a fatal position pointed out to them it should have a large implication in costs if they are stupid enough to proceed. It's also best to try and stay away from court. Obviously don't let them extract the urine with multiple long letter chains though.

M1

[R0b]

Re: Confusion about cause of action on statute barred account

I believe what the solicitors are trying to argue is that the cause of action actually started in 2011, if by going on the example you have given amethyst then their argument is that by terminating in 2011 the limitation period starts then for recovering the remaining balance, less he amount of payments missed as that would be out of time.

So, if they called in the total balance back in 2008 (inc. the missed payments), it is likely to be statute barred but if the total amount payable was not called until 2011, there could be good grounds that the claim is within the limitation period for the outstanding balance.

Of course, the onus is on the lender to show that the claim is within the limitation period and is obviously worth getting all data they hold on you inc. any letters sent and then go from there.

In the meantime though I agree it is not worth getting into a legal arguments because they will then know what your line of defence will be and you don't want to do that right now - the less information they have about your defence the more riskier it is for them to make a claim.

[MikeG]

Re: Confusion about cause of action on statute barred account

Thank you for the replies. I will fire off a request for the information that you have mentioned and update when I have received a reply from mortimer clark

[MikeG]

Re: Confusion about cause of action on statute barred account

This might sound like a silly question but will the formal CCA request include the information like the original agreement, default notices and payments made?

[R0b]

Re: Confusion about cause of action on statute barred account

No you will need to do this by SAR - subject access request

[nemesis45]

Re: Confusion about cause of action on statute barred account

This might sound like a silly question but will the formal CCA request include the information like the original agreement, default notices and payments made?

When a claim is issued one can request documents mentioned in the POC, e.g. the agreement, NOA, Default Notice under the provisions of CPR31.14.

nem

[MikeG]

Re: Confusion about cause of action on statute barred account

no claim has been issued yet but I wouldn't mind getting hold of them to see where I actually stand. On the other hand though, do you think that this could give Mortimer Clark more time to try and produce documents if they do try to take it to court

[nemesis45]

Re: Confusion about cause of action on statute barred account

no claim has been issued yet but I wouldn't mind getting hold of them to see where I actually stand. On the other hand though, do you think that this could give Mortimer Clark more time to try and produce documents if they do try to take it to court

At this stage you would need to make a Subject Access Request to the Original Creditor for this information.

nem

[MikeG]

Re: Confusion about cause of action on statute barred account

Well the court form dropped through my letter box about an hour ago. I have just completed the acknowledgment of service and prepared the CCA request ready to send and I am just doing the CPR request letter but I am unsure of what date I should put in at this point:

"To enable me to file my defence and/or counterclaim, I require inspection of documents you mention in your statement of case ahead of filing my defence on XX XXXX 201X."

[Amethyst]

Re: Confusion about cause of action on statute barred account

That date would be 33 days from the date of issue of the claim form ( sometimes the court helpfully print date of service on the form - in which case it's that date plus 28 days ) you can work it out http://www.timeanddate.com/date/dateadd.html

[catquest]

Re: Confusion about cause of action on statute barred account

The example above talks about goods so is more likely a Hire Purchase agreement .
If the agreement said that you must repay the full balance when payments are missed then it is statute barred from then. If the agreement said we must first issue a Default Notice then it would be statute barred after failing to pay arrears within the time specified in the Default Notice. So the date of the default notice is vital.