compensation for cancelling court case - Scottish SB debt

sithemadmonkey

Hanky_Panky wrote: »

You misunderstand what 'written off' means.

No they don't. Scottish Statue Barred debt is legally extinguished - it doesn't exist after the SB date. OP owes nil, nada.

fatbelly

In the Consumer Credit sourcebook (CONC), the FCA includes the following rules and guidance:

"In Scotland, a statute barred debt ceases to exist and is no longer recoverable if:

(1) a relevant claim on behalf of the lender or owner has not been made during the relevant limitation period; and

(2) the debt has not been acknowledged by, or on behalf of, the customer during the relevant limitation period." 7.15.3 Guidance

"It is misleading for a firm to suggest or state that a customer may be the subject of court action for the sum of the statute barred debt when the firm knows, or reasonably ought to know, that the relevant limitation period has expired."
7.15.7 Guidance

"A firm must not continue to demand payment from a customer after the customer has stated that he will not be paying the debt because it is statute barred." 7.15.8 Rule

Hope that helps

iolanthe07

Hanky_Panky wrote: »

You misunderstand what 'written off' means.

No, I don't. In Scotland Statute Barred means written off. Check it out.

Hanky_Panky

iolanthe07 wrote: »

No, I don't. In Scotland Statute Barred means written off. Check it out.

No - it means 'ceases to exist' , my point stands.

sithemadmonkey

'Written off' and 'ceases to exist' are to all extents and purposes the same thing here. You're arguing over semantics, we're all advising the OP the same thing i.e. they don't owe the money any more.

[Deleted User]

tberry6686 wrote: »

Statute barred only means that they can't use the court to enforce payment, not that the debt is extinguished.

It's in Scotland, so the debt is extinguished.

Hanky_Panky

sithemadmonkey wrote: »

'Written off' and 'ceases to exist' are to all extents and purposes the same thing here. You're arguing over semantics, we're all advising the OP the same thing i.e. they don't owe the money any more.

Great - let's just perpetuate this common misunderstanding so that more people can be misled in the future. :T

thomathy

Hanky_Panky wrote: »

Great - let's just perpetuate this common misunderstanding so that more people can be misled in the future. :T

Well, hang on Hanky Panky. What are you actually saying? You are saying that this is a common misunderstanding, but it would be much more helpful to say what's being misunderstood and which previous poster is incorrect. And how they are incorrect.

I know that in England and Wales, a debt that is statute barred still exists. Court action cannot be taken to recover the debt. But, the debt does not automatically cease to exist, and the lender may not choose to write it off.

I was interested to read in this thread - for the first time - that in Scotland, the debt ceases to exist when it is statute barred and is written off. Several posters have clearly stated this, and one has quoted a trustworthy-looking source that seems to agree. They seem confident of their knowledge and I think it a very interesting point and of course it is directly relevant to the original poster, and to others reading this thread.

As it stands it is at somewhat of an impasse. Other posters are stating one thing, and you are stating another.

Are you saying that in Scotland, a statute barred debt does not in fact cease to exist, and is not written off — and that just as in England & Wales, it continues to be a valid debt, even if not court-enforceable?

Or are you saying something else?

Hanky_Panky

thomathy wrote: »

Well, hang on Hanky Panky. What are you actually saying? You are saying that this is a common misunderstanding, but it would be much more helpful to say what's being misunderstood and which previous poster is incorrect. And how they are incorrect.

I know that in England and Wales, a debt that is statute barred still exists. Court action cannot be taken to recover the debt. But, the debt does not automatically cease to exist, and the lender may not choose to write it off.

I was interested to read in this thread - for the first time - that in Scotland, the debt ceases to exist when it is statute barred and is written off. Several posters have clearly stated this, and one has quoted a trustworthy-looking source that seems to agree. They seem confident of their knowledge and I think it a very interesting point and of course it is directly relevant to the original poster, and to others reading this thread.

As it stands it is at somewhat of an impasse. Other posters are stating one thing, and you are stating another.

Are you saying that in Scotland, a statute barred debt does not in fact cease to exist, and is not written off — and that just as in England & Wales, it continues to be a valid debt, even if not court-enforceable?

Or are you saying something else?

As has been correctly stated, in Scotland the debt 'ceases to exist. I have stated on here many times in the past - you may have missed those posts - that 'written off' is a misleading term and creates confusion for the borrower. Writing a debt off is just an accounting exercise for a lender. It means nothing to anyone else. A debt is 'written off' to bad debt which means the lender expects to get no further income from it or if they do it will be pennies in the pound from a debt sale or severely reduced payments from the borrower. It most definitely does not mean it 'ceases to exist'. I have seen many posters on here over the years being misled into believing the debt doesn't exist anymore because it's been written off and are then surprised, annoyed and many ranges of emotion for their misunderstanding.

So - why perpetuate this misunderstanding?

thomathy

Still not getting it.

If the debt in question has legally ceased to exist, what option is there except to write it off? The debt does not legally exist and can neither be sold nor recovered nor even assigned a value of any sort. What possible other treatment can it be given?

You have explained why a debt that is written off does not automatically cease to exist. But you have failed to explain why a debt that ceases to exist is not by definition written off.

Will assume other posters are right on this one unless anyone's got a better answer…