Harrison v Link Financial Ltd [2011] EWHC B3 (Mercantile) (28 February 2011) (MBNA)

Keith Harrison vs. Link Financial Limited

Article from Paul Tilley

Mr Harrison’s case has been widely reported in the press, media and on nearly all consumer internet forums as a landmark ruling for consumers.

Mr Harrison contacted us regarding the difficulties he was having with Link Financial Limited and MBNA before them. He had a number of issues which it seemed to him that MBNA & Link had simply failed to address and their only concern was when Mr Harrison was going to pay them the £20,000 they claimed he owed them. Mr Harrison took out an MBNA Credit Card in 1998, he retained everything which he received from MBNA in the application pack and even took a photo copy of the application form as there was no copy for him to keep. Mr Harrison was a meticulous record keep its fair to say.

MBNA & Link undertook a campaign of telephone harassment which as His Honor Judge Chambers QC found {at Para 53}

In my view, the Claimant rightly complains that, mainly by MBNA but also by the Defendant, he was hounded by telephone calls seeking payment of what was said to be due. The calls were a form of torture oppressively frequent in amount and often without attribution to an identifiable number. I am unimpressed by suggestions that all that the Claimant had to do was to seek a meeting when the position was that those who called him would not listen to what he had to say of his difficulties.

Mr Harrison did not set out with the intention of not paying MBNA, far from it, in fact it was Mr Harrison’s intention to repay MBNA, however at the point he fell into difficulties rather than freeze the interest MBNA simply increased it up to in excess of 30% APR.

Mr Harrison was unfortunate that a number of his family members fell ill at the same time, which had an adverse impact on the family income. Mr Harrison operated a family business and the loss of over half the workforce understandably had an impact on finances.

Mr Harrison explained his circumstances to MBNA over the telephone and in writing, however it seemed that his comments were ignored. In evidence at Court Mr Harrison confirmed that he had explained his circumstances to MBNA and that they would simply ring over and over asking for money that they knew could not be paid due to the family circumstances. Mr Harrison’s view was that MBNA were just calling to make such a nuisance that he would pay them to get rid of the calls. It was a very stressful time indeed with family members ill in hospital.

MBNA eventually served a Default notice of Mr Harrison, fortunately Mr Harrison retained the notice and the envelope which the notice came in. As a result we were able to obtain information to show the date and time of posting and to prove beyond doubt when Mr Harrison actually received the notice.

The account was subsequently assigned to Link Financial Limited by a legal assignment under the Law of Property Act 1925.

Link continued to contact Mr Harrison by phone, employing the same approach as MBNA before them. When we became involved, the difficulties continued. We warned Link that they were in breach of

Section 78 Consumer Credit Act 1974 as the documents provided were illegible
s61(1) Consumer Credit Act 1974 as the agreement did not contain all of the applicible rates of interest.
s62 & 63 Consumer Credit Act 1974 as copies of the agreement were not provided.
s87 Consumer Credit Act 1974 as the Default notice failed to allow sufficient time to remedy the breach and had other errors
s140A Consumer Credit Act 1974 as the conduct in recovering the debt had made the relationship unfair.

Link replied that they would not seek to enforce the agreement until they could comply with their obligations and that if we were to issue proceedings they would vigorously defend them. Mr Harrison was happy with that position, however, while Link were telling us they were not going to take enforcement action, they wrote to Mr Harrison telling him that they were looking at seeking a charging order on his home. This happened a few times, Link would tell us “were not going to sue” and would tell Mr Harrison that they were. So accordingly to protect Mr Harrison’s position we issued proceedings to restrain Link from seeking to enforce the agreement.

Link appointed solicitors who filed a Defence and a Counterclaim seeking to recover all of the outstanding monies, despite Link saying they would not. So, we applied to amend the Claim which HHJ Chambers QC allowed, and we brought into play all of the issues set out in the above bullet points.

Link took a number of attempts to satisfy section 78 Consumer Credit Act 1974 with some of the documents provided clearly not measuring up to HHJ Waksman Qc test in Carey v HSBC Bank Plc of being “Honest and accurate” as for example the terms provided had the wrong default charges for the time when the agreement was taken out, the insurers registered address was not correct, and the address quoted was not in use for at least 12 months after the agreement was signed, to name but a few problems with the documents. Indeed Link only managed to comply with s78(1) on the day of the trial.

The Default notice was a more interesting point. Link tried to argued firstly that the notice was served in time, that argument failed given the weight of the evidence to prove it was not. Then they tried to gracefully argue that they did not need a Default notice as they could terminate the agreement whenever they felt like it by relying upon their terms and conditions. Link relied on a case that had involved Mr Harrison previously in Exeter County Court before HHJ Griggs. The case was called American Express Europe v Harrison.

Our position was simple, s87(1) and 98 Consumer Credit Act are mutually exclusive, s87 deals with breach 98 deals with non breach. The current matter concerned a breach of contract and therefore the creditor must serve a Default notice before it can terminate even in reliance on a power in its contract. Indeed the editors of Goode Consumer Credit Law and Practice appear to agree with that view.

Since the Amex case was a County Court decision His Honor was not bound to follow it as he was sitting as a High Court judge. His Honor considered the Defendants argument on contractual termination outside of the Consumer Credit Act and his comment here in our view shows his feeling towards that argument

The Defendant also suggested that a presently adverse outcome to proceedings in respect of the American Express card had some bearing on this case. Nothing shown to me in respect of that case shed any light one way or the other on how I should approach this case.

Indeed if the Defendant were right that it could take such action they would have surely won on that point, however consideration of Para 75 is necessary

The notice of enforcement

The notice of enforcement was a statutory pre-condition of enforcement. It was a bad notice and enforcement cannot be attempted in dependence upon it. However, bad notices can often be remedied by the service of good notices and I see no reason why that should not be so in respect of credit agreements.

We take the view that the Defendants view was wrong and the Courts ruling confirms this is the case.

The issues on s61Consumer Credit Act unfortunately failed, in our view the judge was wrong to find the prescribed terms were present for the following reasons

HHJ Chambers found the terms and conditions were not provided to Mr Harrison when he signed the application form.

Section 61(1)(a) CCA 1974 requires that the document signed by the debtor contains all of the prescribed terms when the debtor signs the document. They cannot as a matter of established law be provided later to remedy such a failing.

The rates of interest were set out in the terms and conditions, which were found “not” to have been present when the application was signed.

Therefore, in our view the prescribed terms were not contained within the agreement and the agreement ought to have been held unenforceable by virtue of s127(3) Consumer Credit Act 1974. An appeal on this point was mooted but Mr Harrison decided against it given that the outcome of the case was entirely favorable.

The unfair relationship ruling under s140A Consumer Credit Act was in our view the most helpful as it laid down clear guidance to creditors that telephone harassment will not be tolerated and that the Court will take a robust approach where necessary. In Court Mr Harrison produced a log of all the calls received which Link did dispute and suggested that some numbers weren’t even theirs, although at lunch our barrister telephoned these numbers and the telephones were answered with a welsh sounding lady who proceed to say …..Good afternoon Link Financial…….. draw your own conclusions but the Court accepted that the calls had come from MBNA and Link contrary to their assertions. To anyone reading the call log it would be readily obvious that most of the calls were of no purpose but to make life difficult to Mr Harrison.

Link vehemently fought the case in Court, but many of their arguments were simply doomed from the outset, they even fought over the Default notice despite MBNA’s own solicitor conceding our clients view was correct. Fortunately, the evidence was there for the Court to see, the facts were irrefutable and Mr Harrison was such a meticulous record keeper, that his evidence was far more believable than the “this is what would have, Should have, may have but were really not sure” points that the opponent were putting forward. HHJ Chambers concluded that our clients version of events was correct and he made the following order set out below.

The Court made an order that

Upon hearing Counsel for the Claimant and Counsel for the Defendant


(1) Pursuant to s142(1) Consumer Credit Act 1974 the Agreement is improperly executed within the meaning of s61(1)(a) of the Act and is therefore unenforceable except by an order of the Court

(2) The relationship between the Claimant and Defendant is an unfair relationship within the meaning of s140 of the Act;


1) The Defendants application for an enforcement order under s127(1) of the Act is dismissed and accordingly the Counter Claim is dismissed.




The final 3 paragraphs dealt with costs, so are not relevant to the matter.

The decision was welcomed by many consumer focused websites as being a judgment for the consumer and setting down the line which creditors should ensure they do not cross, and the consequences if they do.

BAILII has hosted a copy of the High Court ruling which can be found at the following location Harrison v Link Financial Limited [2011] All ER (D) 165 (Jun)

Mr Harrison has given the BBC an interview concerning his case and the impact it has had on his life. The interview can be found here Credit card ‘torture’: one man’s story