Query on Statute barred debts

hbl_2

The creditor or DCA must bring an actual claim through the courts before the 6 years is up, and to my knowledge that 6 years counts from the last payment made by the debtor. With any Consumer Credit Act, the creditor must serve a notice of default within 14 of non-payment and then again no later than every 6 months. To not do so is an offence under the act.

As for acknowledging the debt in writing, this is merely evidential, and if no debt exists (be it from termination by conduct - for instance not serving a notice of default, not chasing the debt ever), then there is a strong argument to be made that you can't acknowledge a debt that no longer exists.

The long and short of it is that when the six years are up, no claim can be made. The simple cost of claiming through the court is enough for DCAs not bother - to go to the expense just to be told it's statute barred. In practice, I don't think you see many claims outside of the limitation period.

k1mmie

I have a query! If a judgement (CCJ)and debt is over 6 years and you have made payments within that period, but when you send a CCA (I assumed they must still have the details if they are enforcing it by collecting it), they cannot or do not produce any paperwork or correspondence at all - what is the next step?

I also have another company that I sent a CCA. The DCA said that they would refer it to their clients, who of course we never heard back from (september 2007).

Now I have had another letter from the same DCA as though nothing happened demanding the money. What letter should I send them and who can I report this to?

neverdespairgirl

This isn't my area of law, but as I understand it:

The general limitation for debts is 6 years in England & Wales (all my comments refer only to this jurisdiction). This doesn't mean the money isn't owed. It means the creditor can't sue. So if a debt is statute barred, but there has been some contact within the limitation period, and the company rings up and says, "you owe us £6k, please pay", that's not illegaly. You do owe them £6k. If you agree to pay it, and send off a cheque for £6k, you can't usually reclaim it (there may be exceptions for bad faith and fraud, which is why I suggested a friendly "please pay" contact).

Limitation runs from the last time the debt was acknowledged in writing, or a payment made (even by someone else). So if a debt is 5 years and 11 months old, and you pay £1, it restarts the 6 year period. As I understand it (and will double-check later) writing to ask to set up a payment plan, or amend your details such as address, could well count as acknowledging the debt. So could a letter saying you can't pay at the moment, but will in, say, 6 months' time.

Exceptions include:

land debts - mortgages don't fall within the 6 year rule, it's 12 years. However, I think a lot of lenders have agreed to stick to 6 years.

new student loans (the ones that started in the late 90s - perhaps 1999?) - under the rules, they can take it from earnings, so don't need to go to court

benefits - some benefits overpayments can be clawed back after 6 years because they can take it from benefits you are still paid, and don't have to go to court.

Income tax - I'm 99% sure this doesn't fall within the Limitation Act, the govt. can still come after you for the money, and for VAT as well.

CCJs - if there is a CCJ, the Limitation Period doesn't run from when the debt was last acknowledged / paid. 6 years from the date of the judgment, the holder would usually have to get permission from the court to enforce it, though.

realshannon

I have sat here for what seems hours and it has been extremely enlightening to say the least! I am again trying to help a friend who is disabled. She has mental health issues, severe depression, and alot of health issues including mobility. She is now in sheltered housing and has been on a range of benefits for many years she is 62. However, about 2 years ago she lost her home via Kensington Mortgages despite me trying to help it was too late and she was evicted. I have been aware for a while (and have offered to help several times) that she has alot of debt apart from the repossession. She says she hasnt heard anymore from Kensington so again with the o/s debt and the resale of the house I am assuming this is settled. But dont know, wouldnt they have sent her a letter saying the debt was discharged?However, after reading quite a few threads it appears that some of the other debts she has,and is trying to pay off,may not actually be enforceable. She has Lowell, Westcott and now JBDR contacting her. She is easily frightened and will basically agree to anything to get rid of them, hence the ongoing problems - she agrees to pay unrealistic figures to passify them but then cant and she tells me that they then add on default fees so basically she will never get rid of the debts as the default fees override, in essence, the minimal amount she pays them every month or whatever. Some of these debts are from in excess of 10 years ago! in 2007 she had only £653 owing to Lloyds via Lowells and around a £1000 to Top Shop via Westcott. I am trying but it is so complicated and she gets embarrassed and wont see the CAB, I tried to set up a filing system for her instead of carrier bags but she just gets in a muddle - she nearly died in Feb with kidney failure and this isnt helping her health - is there a quick answer to sorting this mess out for her so she can enjoy as best she can the rest of her life? I am trying to sort out a basic bank account that will pay out standing orders and direct debits so that will help and stop her missing payments. She doesnt mean to but her health is such that she forgets to send a postal order off, sometimes buys it, sticks it in her handbag and forgets! I am limited as I do not live that close and have my own complex finances to sort out but I dearly would like to help if I could - any feedback would be very much appreciated.

10past6

realshannon wrote: »

any feedback would be very much appreciated.

Hi

The first thing that springs to my mind, what are the possibilities of you having "Power of attorney" for her?

realshannon

Thanks for suggestion - a while ago I did a load of letters for her saying that I had authority to deal on her behalf, she was worried that if she did this I would then end up responsible for her debts ie if anything happened to her, but I was fairly confident that wouldnt be the case as my name isnt on any of the debts or had anything to do with me. It is extremely tricky, although she has all these debt collectors in actual fact I find her finances are more straightforward than mine! the major tripping point seems to be her health and the fact that she only has a post office card account with no dd or standing order facility. I reckon if I can get her a Barclays or A&L basic account she would be laughing as at least the minimum payment would be paid and any extra she pays independently is a bonus - what a mess, wouldnt you think social services or a social worker could help but they dont want to know;)

realshannon

I should also say that she doesnt live that close to me so again this is a sticking point in that any problems that I cant get thro to her on the phone means potentially a long trip which is difficult with work etc but I do try! have just sorted out her BT which was cut off even tho she has a Life Line attached and now they have charged her the reconnection fee which doesnt seem quite right - they didnt tell her she could use 999 or 150 which they later confirmed to me - data protection doesnt exist as they freely talked to me about her account which was enlightening but not good in theory - see if I can get anything back off them with a strong letter

frazzmunch

hi realshannon...sorry to hear about your friends issues...depending on her current landlord i would suggest you contact her local council or her housing association and ask if they could make a referral for her for a housing support worker? this service is free of charge and her support worker will help her sort out her benefits & finances...

RAS

realshannon

if you friend is now back on the phone, next time you see here try to get her to ring once of the debt charities - which are free phone see here http://www.moneysavingexpert.com/loans/debt-help-plan#help

You may have to keep re-dialling as they are very busy.

Personally, I think she should at least consider bankruptcy. It does not appear that she has anything to lose except the debts.

If she has been making imtermittent payments to the DCAs, then some of these debts would not be statute barred; there has t be a full 6 year period with no payment or written acknowledgment.

If she will not go BK, then at least demand the CCA for all the debts and check whether they are statute barred.

Anything that has a CCA and is not statute barred, then try to reclaim any charges.

But at least ask her to consider all options.

l0rdy

I'm just curious..because most mobile phone contracts these days allow you to simply give your agreement and details over the phone.....without ever having to sign anything. That includes bank details for setting up direct debits and of course the actual agreement for the mobile phone itself. They send you out a copy of the details that you have given them oraly once the contract has been set up, but not once have I ever actually had to put pen to paper with any of my mobile contracts.

Is this covered under the act or are there different regulations regarding mobile phone contracts?