Help please with a Social Fund Loan

serendipity102

Thank you so much - feel a lot happier now! Will take your advice and construct my letter this evening! Your help is very much appreciated!!!!

fermi

Apples2 wrote: »

I think it is a little grey. As fermi has described, it CAN become SB in as much as they cannot drag you through the courts, appoint bailiffs etc, but they CAN still reclaim the money via benefits.

Said that right at the beginning.

Nothing at all wrong with them deducting a valid debt from the benefits you get now or in the future.

But....

- They should have to prove that you were lent the money if you dispute or have no recollection that you borrowed it.
- They shouldn't threaten court. I know they might not have here, but they often do. So they need to know that YOU know that they are barred from that option.
- They shouldn't be passing it to a debt collector, as they would be asking the debt collector to breach OFT guidelines from the off by asking for payment. Again, they need to know that you know the score.

These things can drag out, going off to collectors, back to DWP, silly threats made of this and that. Best to nip that all in the bud straight away.

Then if you owe it you can make arrangement to pay back on your own terms, in your own time, via deduction or otherwise.

fermi

serendipity102 wrote: »

Thank you so much - feel a lot happier now! Will take your advice and construct my letter this evening! Your help is very much appreciated!!!!

Good. But if you are not sure, then give National Debtline a call freephone on 0808 808 4000. Talk it through with a professional debt advisor.

Paul_the_Painter

Something to bear in mind though, is that as fermi said, they can deduct it from benefits in the future.

You may feel that paying £10 or £20 /month now to get rid of it over the next few years is worth it, as if and when you did ever need benefits, they would only deduct it then, at a time when you would be even more short than now.

Your choice though

Not sure if they can deduct from State Pension?

serendipity102

Thank you again. If i owe it --- and (given the year it was loaned and the things that were happening) I suspect I might, I am quite happy to arrange a payment plan with them - albeit a fiver a month, which is all i can afford at the moment -- at least I will have shown willing and it will have reduced the debt should I have a need to claim benefits in the future.

theoretica

Personally I would be tempted to offer to pay it in full. In 2025.

debt_doctor

Oh Dear!

If my colleague Ian were to see this......................!!

Ian has just steered a client through the very same thing. The 'cause of action' which is where the Statute of Limitations begins is claimed by the DWP as "when they formally demand payment" Also the DWP refuse to accept that the high court ruling (cant remember the exact one) that says the Statute of Limitations applies to ALL methods of recovery NOT just Court action- does not apply to them as they were not a party to the procedings (it was a tax credits ruling)

We (Ian) found that the best course of action was to lodge a Formal complaint against the DWP for MALADMINISTRATION, in that they sat on this debt for so long that a former claimant could not possibly, just through time elapsed, give a reasonable response.

Our CAB office (and I'm sure Country wide) have seen a massive increase in old debts demanded by the DWP in the last year, to no doubt try to bring as much money in as possible.

I will post an appropriate letter for you on this thread, but not for about 2 weeks as I'm on hols for two weeks and I need to see Ian's casefile. What I will say is that it will be a long drawn out affair that will end up with the Independent Case Examiner- Which is where our CAB clint is............

DD

fermi

debt_doctor wrote: »

Ian has just steered a client through the very same thing. The 'cause of action' which is where the Statute of Limitations begins is claimed by the DWP as "when they formally demand payment"

Sounds like nonsense, as surely social fund loans have set conditions and times over which they are to be repaid.

It would be unreasonable for them to be allowed to delay the cause of action indefinitely by their own incompetence.

As per....

A cause of action can still accrue (i.e. time starts to run) even though a claimant is prevented from suing by a statutory procedural requirement which precludes the issue of proceedings.

In Swansea City Council v Glass (1992) the local authority brought a claim against a landlord for reimbursement of the cost it had incurred in repairing a house in multiple occupation. The issue was whether the cause of action accrued when the work had been completed or or only when the local authority had served a written notice demanding payment as required by The Housing Act 1957. The Court of Appeal held that the statutory requirement for a written notice was a procedural matter and that time ran from the date that the costs were incurred and the work completed. If this were not the case the local authority could prevent time from running indefinitely simply by not serving the statutory notice.

In respect of an agreement regulated by the Consumer Credit Act, the question is whether the time runs from the date of actual default by the debtor or from the date of (or the date of expiry of) the default notice that must be served under s87 CCA1974.

The situation is analogous to the Swansea City Council case in that the requirement for the service of a the default notice is a procedural matter that does not form part of the cause of action. It does not affect the creditor's right to payment but only the procedure for enforcing it. If this were not the position, a creditor could delay the running of time indefinitely by not serving a default notice.

This view was supported by West Bromwich Building Society v Wilkinson (2005), where the House of Lords stated that it would be 'strange if a lender could stop time running by its own act'.

OK, that refers to a CCA regulated debt, but the principle is the same.

fermi

DWP admitting a similar debt is statute barred here:

http://forums.moneysavingexpert.com/showpost.php?p=50218283&postcount=14

The limitations Act 1980 does not deny the Department the right to attempt to recover balances. However, the Department is limited in that we cannot pursue a case through civil proceedings where the debt is over 6 years old and there has been no acknowledgement of it by the customer.

serendipity102

Hello again, and once again a very big thank you to the people that gave me advice!

Another letter dropped through my door and I called DWP about 10 minutes ago.

It would appear that they havent yet got my letter.

I spoke to a man who confirmed that, despite what their letter says, there is nothing that the DWP can do apart from deduct anything I owe from any benefit payments that I may claim in the future. I told him that I had taken advice and the debt, i believed, was statute barred. He confirmed this. He advised me to make a minimum payment (upwards of £1 a month) and that could possibly stop the DWP from appointing a Debt Collection Agency from attempting to contact me (although he admitted that they would probably appoint a DCA anyway to try and get what they could as they need to collect as much as poss!). He also acknowledged that, despite the fact that it was statute barred, the DWP would try and get me to pay anyway which it could. He told me that 'most people dont know about statute barred and when someone mentioned it they had no choice but to back off'. He also confirmed that the worst that could happen, legally, was that a deduction could be made from future benefit claims I may make.

Again, a very big thank you to the people who advised me.