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A little bit of background first. I am trying to help a relative who has suffered a mental breakdown. They have been diagnosed as at risk. They had been behaving erratically for a number of years. A bereavement seems to have tipped them over the edge and at that point they opened up about a range of abusive relationship and debt issues. In my opinion they are not fully capable of dealing with their affairs but I do hold LPAs for finance and health so I am in a position to help. It has taken me several months to understand the position and I have now reached a point where I need to get some clarification on some points of law.
I have identified six debts, all unsecured and all initiated between 1999 and 2006. They are a mixture of credit card debts and personal loans, All of them have been sold on at least three times. Looking back through the old correspondence, which is comprehensive, I can see that all of the accounts were defaulted prior to 2010. The creditor approaches all seemed to follow the path of aggressive collection tactics eventually leading to the debts being passed to debt collectors and subsequently sold. Payment plans - not an IVA - for nominal sums were set up and maintained for a number of years, sometimes interrupted, sometimes without a break. For some reason I have not been able to ascertain, all payments on one debt ceased in 2015 and the other five ceased in 2018. I have checked every bank statement and am 100% certain that no payments have been made since those dates.
One creditor whose payments ceased in 2018 sends statements but no other communications. I see that this creditor issued a letter before claim five years ago but in response to a 'prove it' type letter, the Solicitor acting for the creditor simply stated they were referring the file back to their client and I cannot see any other correspondence apart from the six monthy statements which show a fixed balance. The other four creditors have at different times, and when the debts have been under different ownership, made various substantial full and final settlement offers. I am confident that they never received a response because I have a comprehensive file of paperwork and access to emails. I cannot find any communication of any kind from the other five creditors after the payments stopped in 2018. I find this odd but it is what it is. The debtor was ill in 2018 and I have comprehensive records from 2020 so if they were chased after stopping the payments I think it would only have been between 2018 and 2020. The reason I don't think that they could have written to the creditors in the same period is that all letters to any recipient have always been written in Word and then printed and posted and there's nothing in the documents addressed to DCAs or solicitors apart from the prove it letter referred to above.
I have been able to get credit reports from all of the agencies and none of the debts appears on any of them. I have also checked that there are no CCJs. In fact the credit reports are unblemished. As all the accounts were defaulted by the original lenders prior to 2010 and there has been no acknowledgement or payment I can see no reason that these debts will not become statute barred this year. I will be quite honest and state that it appears that these debts are valid but at the same time I am not going to damage this person any more by helping the debtors unless they are legally enforceable. If they are, then they'll get what's affordable.
I am therefore going to wait it out and see if these debts become statute barred in the next few months. I have heard anecdotal stories of DCAs starting claims just days before the limitation period expires but I have not seen any actual examples of this. It's a concern but I cannot see why a debtor would take the risk of missing the deadline and incurring risks and fees unless they had all the evidence required to win a case, starting with the CCA. These are now very old debts and multiple DCAs have had numerous opportunities over an extended period to bring a claim and not one has. I spoke to a debt helpline whose advice was do nothing and wait, which made sense to me as anything proactive on my part, even as attorney, could acknowledge the debt and reset the limitation period. I have been informed that the pre action protocol can be sidestepped if following it would take the claim outside the limitation period but if that tactic is used, then a stay should be sought so that the PAP can then be undertaken. My reading of the situation is that such a last minute claim bypassing the PAP would be reflective of a strong claim but regardless of that I have been advised that if it happens I should still use my LPA to request a CCA. I now have to wait but I want to be prepared for all eventualities, so to get to my questions:
What is the significance that seems to be attached to pre 2007 agreements in the context of the CCA and requiring proof of the debt?
I have what look like the original CCAs. If the validity of CCA provided by a claimant becomes an issue, how would I able to use one or more to prove that a true or reconstituted copy is in fact not a copy without proving the debt myself?
Am I correct that the debt that ceased payments in 2015, was defaulted by the original lender in 2009 and has had no acknowledge or court action should now be statute barred?
Am I correct in my assumption that it would be the original defaults that would count as the cause of action, not stopping making the nominal repayments?
Next, that if my assumption about the cause of action is correct, then the only barrier to statute barring would be having made a payment or acknowledging the debt within six years of the last payment or the creditor issuing a claim?
How is the date of claim defined - is it the date it is registered with the court? I can't see how it can be the date of a letter before action but would appreciate confirmation of this.
How exactly is the limitation period calculated? By way of example if the last payments were made at 10pm on 30th January 2018 would the debtor's six year limitation to make a claim have ended yesterday, end at midnight tonight or midnight tomorrow?
In the event that one or more claims are received, judgment can be obtained, and in the light of the debtor's age (retired), income (state pension only), assets (none) and the previous nominal sums agreed, is it likely that these sorts of amounts would be ordered to be reinstated by the court? I cannot see why a creditor would see any value in pursing a claim for thousands if they are only likely to receive a pittance in the expected lifespan of the debtor, probably less than the court fees.
In addition, in the event of a successful claim, could interest be claimed at 8% on the debt from the time of the last payment or would it be the debt at that time plus the nominal payments that would have been paid?
Is there anything else that I should be doing at this stage and in partcular in terms of using my LPAs?
Thanks in advance. It's particularly difficult dealing with something when I can't ask too many questions due to the health of the person concerned, I have dealt with dementia before but this is just as challenging so all advice would be welcome.
I have identified six debts, all unsecured and all initiated between 1999 and 2006. They are a mixture of credit card debts and personal loans, All of them have been sold on at least three times. Looking back through the old correspondence, which is comprehensive, I can see that all of the accounts were defaulted prior to 2010. The creditor approaches all seemed to follow the path of aggressive collection tactics eventually leading to the debts being passed to debt collectors and subsequently sold. Payment plans - not an IVA - for nominal sums were set up and maintained for a number of years, sometimes interrupted, sometimes without a break. For some reason I have not been able to ascertain, all payments on one debt ceased in 2015 and the other five ceased in 2018. I have checked every bank statement and am 100% certain that no payments have been made since those dates.
One creditor whose payments ceased in 2018 sends statements but no other communications. I see that this creditor issued a letter before claim five years ago but in response to a 'prove it' type letter, the Solicitor acting for the creditor simply stated they were referring the file back to their client and I cannot see any other correspondence apart from the six monthy statements which show a fixed balance. The other four creditors have at different times, and when the debts have been under different ownership, made various substantial full and final settlement offers. I am confident that they never received a response because I have a comprehensive file of paperwork and access to emails. I cannot find any communication of any kind from the other five creditors after the payments stopped in 2018. I find this odd but it is what it is. The debtor was ill in 2018 and I have comprehensive records from 2020 so if they were chased after stopping the payments I think it would only have been between 2018 and 2020. The reason I don't think that they could have written to the creditors in the same period is that all letters to any recipient have always been written in Word and then printed and posted and there's nothing in the documents addressed to DCAs or solicitors apart from the prove it letter referred to above.
I have been able to get credit reports from all of the agencies and none of the debts appears on any of them. I have also checked that there are no CCJs. In fact the credit reports are unblemished. As all the accounts were defaulted by the original lenders prior to 2010 and there has been no acknowledgement or payment I can see no reason that these debts will not become statute barred this year. I will be quite honest and state that it appears that these debts are valid but at the same time I am not going to damage this person any more by helping the debtors unless they are legally enforceable. If they are, then they'll get what's affordable.
I am therefore going to wait it out and see if these debts become statute barred in the next few months. I have heard anecdotal stories of DCAs starting claims just days before the limitation period expires but I have not seen any actual examples of this. It's a concern but I cannot see why a debtor would take the risk of missing the deadline and incurring risks and fees unless they had all the evidence required to win a case, starting with the CCA. These are now very old debts and multiple DCAs have had numerous opportunities over an extended period to bring a claim and not one has. I spoke to a debt helpline whose advice was do nothing and wait, which made sense to me as anything proactive on my part, even as attorney, could acknowledge the debt and reset the limitation period. I have been informed that the pre action protocol can be sidestepped if following it would take the claim outside the limitation period but if that tactic is used, then a stay should be sought so that the PAP can then be undertaken. My reading of the situation is that such a last minute claim bypassing the PAP would be reflective of a strong claim but regardless of that I have been advised that if it happens I should still use my LPA to request a CCA. I now have to wait but I want to be prepared for all eventualities, so to get to my questions:
What is the significance that seems to be attached to pre 2007 agreements in the context of the CCA and requiring proof of the debt?
I have what look like the original CCAs. If the validity of CCA provided by a claimant becomes an issue, how would I able to use one or more to prove that a true or reconstituted copy is in fact not a copy without proving the debt myself?
Am I correct that the debt that ceased payments in 2015, was defaulted by the original lender in 2009 and has had no acknowledge or court action should now be statute barred?
Am I correct in my assumption that it would be the original defaults that would count as the cause of action, not stopping making the nominal repayments?
Next, that if my assumption about the cause of action is correct, then the only barrier to statute barring would be having made a payment or acknowledging the debt within six years of the last payment or the creditor issuing a claim?
How is the date of claim defined - is it the date it is registered with the court? I can't see how it can be the date of a letter before action but would appreciate confirmation of this.
How exactly is the limitation period calculated? By way of example if the last payments were made at 10pm on 30th January 2018 would the debtor's six year limitation to make a claim have ended yesterday, end at midnight tonight or midnight tomorrow?
In the event that one or more claims are received, judgment can be obtained, and in the light of the debtor's age (retired), income (state pension only), assets (none) and the previous nominal sums agreed, is it likely that these sorts of amounts would be ordered to be reinstated by the court? I cannot see why a creditor would see any value in pursing a claim for thousands if they are only likely to receive a pittance in the expected lifespan of the debtor, probably less than the court fees.
In addition, in the event of a successful claim, could interest be claimed at 8% on the debt from the time of the last payment or would it be the debt at that time plus the nominal payments that would have been paid?
Is there anything else that I should be doing at this stage and in partcular in terms of using my LPAs?
Thanks in advance. It's particularly difficult dealing with something when I can't ask too many questions due to the health of the person concerned, I have dealt with dementia before but this is just as challenging so all advice would be welcome.
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