How to prepare a good defense for a hearing at the County Court

Yoooz

Hi all,

I would be grateful if I could get some advice as how to prepare for the court hearing.
It is a long story but I will try to cut it a bit short and explain the circumstances.

In 2007 I took out a credit card with then Lloyds TSB bank. I always paid the required amounts on time and never had any problems with them regarding that.

Then in 2010 I asked them for consolidation load as I also had existing loan with them, another credit card for my girlfriend and a couple of grand of overdraft on our current account to make it easier to repay. They agreed and the loan started in March 2010. They cut through the chip of our credit cards and accounts were suppose to be closed after the last interest repaid, also overdraft was reduced.
All good at that point but...around December 2010 I received letter asking me to start repaying the balance on my credit card as it's overdue. I phoned them up and explained that I don't have any credit cards as the last one was closed some 8 months ago only to be told it's still active with a balance of around 800.That was a shock to me, knowing that I have closed all the credit card accounts. It was a car insurance premium, which my car insurer requested for the next year. As I paid for my car insurance by the credit card the previous year the same payment was applied. I was not aware of it expiring as I was in and out of the country as my wife gave a birth to our son in September 2010 and went abroad for a few months during her maternity leave.

I phoned Lloyds TSB and spoke to a representative, who could not explain how the payment
out of the closed account could have happened and only told me to start making payments
towards unlawfully re-opened credit account.
Despite that I still offered to repay it by making repayments but the last three of them have never reached the credit account at which point I contacted the bank to let them know that I will not be making any further payments towards the account until those payments are transferred
onto the credit account as it is pointless since the money disappear. I received a couple more phone calls from then then but told until I see this money on the account I won't make another payment as it's pointless exercise. Not heard from them since.

Now after some 6 years I received letter from Lowell Solicitors telling me that they issued a court claim against me to recover that money. I contacted Lloyds but they told me to speak to Lowell Solicitors as they've got all the relevant paperwork.
I have since filed the successful defense based on the fact credit agreement was entered into by creditor only, without my knowledge and consent, which breaches the Consumer Credit Act 1974, part V points 60 & 6 as my account was closed by me in 2010 and I have not sign a new credit agreement since.

It will now go to a hearing and would be grateful if I could get any advice how to defend against this claim.

Many thanks for your help in advance

eskbanker

What evidence do you have that the credit card account was actually closed?

You make reference to various points which suggest that you considered it closed but the acid test is whether Lloyds TSB agreed and what clear documentary evidence there is of this.

Personally I'd have thought that making subsequent repayments towards a new charge on the account would indicate that you accepted its reopening, as the time to challenge its legitimacy was back then rather than now.

Yoooz

I managed to find a letter from bank confirming the opening of the consolidation loan, which says the credit accounts will be closed. I also got statement from that loan showing the balance transfer from the credit account.

They were surprised now when I contacted them as to why that payment went out of the account as it shows on their system the account should have been closed when I opened the consolidation loan. Their representative I spoken with could not explain that but said all the relevant paperwork is with the solicitors now and she can't do nothing about it.
It looks as if someone forgot to click the right button on their system.

Back then I haven't challenged it as I thought it would be fair to repay but the payments have not reached the account at all so they were taking the money from me but not putting it onto the account. It turned out now that apparently they issued a new card (they couldn't do that as the account was closed), which I never received and as I was making payments on the old account number hence the money have never reached it.

meer53

If you cancelled your car insurance as you left the country, you should be speaking to your insurer to ask why they debited your card. If you didn't, then they were within their rights to process the debit to your card, if the card was cancelled it would still have debited as they had prior authorisation from you.

It's a simple process for your card issuer to move the payments to the correct account, I think you'll find that there has been no breach and that you still owe the money. Do you have a solicitor ?

eskbanker

It still seems to me that you recognised that you owed them the money but that some sort of admin mistake led to some repayments going astray - I can see why you'd be unhappy about this but to my mind it doesn't mean that the debt has magically gone away. Having implicitly accepted the debt by making repayments I think you'll struggle to convince a court that you don't now owe them the remaining balance. You may believe that they're on weak ground on some sort of technicality, but haven't really made that case above and they presumably feel they have a decent case to let it get this far.

However, as you accept in your OP, it's a long story and there will obviously be more to it than you've posted so far - what is the bank's line of argument for example? What happened to your repayments? What did your credit card statements say all the way through? Did you change address at some point without notifying them?

Shakin_Steve

Did you contact the insurance company that took the payment in 2010? Did you insure the car with someone else or did you make use of the insurance that had auto renewed?
The reason for my questions is that, if you did contact them and explain the situation, they should have reimbursed your premium minus admin fees. If you did not contact them it could be said that you should pay for the service you used.
EDIT: Three replies in four minutes. Hope mine is still relevant.

Shakin_Steve

To give you some sort of example: I have a continuous payment authority with Sheffield University for my sons accommodation fees. Three payments in October, January and April. I received a new card, with a different sixteen digit number, from my bank in February, I let the university know. However, if I hadn't let them know, the bank would have still paid the fees due in April, this is what CPA is all about.

People need to remember to cancel all CPA's when closing an account.

18cc

I would answer your question in the same way I would advise anyone who has a county court debt hearing - don't worry, stay calm if you can, put your point of view forward, tell the truth and see what the judge has to say. In general, they are fair people, have seen it all before, can tell the genuine people from the blatently idiotic, and try to reach fair settlement whenever possible.

Yoooz

Thanks for the advice.
I'm at work at the moment and haven't got enough to answer all the queries though will try after work.
In terms of the car insurance - when I went out abroad with my girlfriend we have moved out of the flat we were renting but when I was coming back in 3-4 weeks time I was going to stay at the hotel until I find something to rent, I ended up renting from my friend and that was reason I couldn't change the address with the bank as had no new one to give them. In that 3-4 weeks I was away the car insurer send a renewal thus I knew nothing about it as I genuinely forgot it was due. Then Lloyds must have also sent the credit card statement to that address as I only found out about it when it was overdue. I still used the car though so needed the insurance. When I contacted the insurance company, what they called the ''cooling period'' was over so it would have cost me over £100 to cancel it, hence I didn't bother, instead I offered to repay the card. But as I mentioned earlier I made a total of 3 payments for the total amount of around £150-180, which haven't reached the account. I asked them to get it right as I can't keep paying if the money disappears. It's only when I went to speak to them now they understood what the problem was. They couldn't work it out back then as the money was never transferred.
I do understand when your car expires then car insurance premium would still go through even if there's a new card now but if you close the account you are terminating the credit agreement at that stage and no further payments can go out of the account from that minute - that's my understanding of the agreement as I went through the T's & C's, correct me if I'm wrong.

Emily_Joy

Yoooz wrote: »

if you close the account you are terminating the credit agreement at that stage and no further payments can go out of the account from that minute - that's my understanding of the agreement as I went through the T's & C's, correct me if I'm wrong.

Well, you are wrong. When you cancel a credit card you are advised that you need to cancel/rearrange all subscriptions/CRA independently. This is also the reason why your credit card account doesn't disappear from your online banking for a year at least.

I am somewhat confused - I would expect the payments you've made to bounce back?

Shakin_Steve

Emily_Joy wrote: »

Well, you are wrong. When you cancel a credit card you are advised that you need to cancel/rearrange all subscriptions/CRA independently. This is also the reason why your credit card account doesn't disappear from your online banking for a year at least.

I am somewhat confused - I would expect the payments you've made to bounce back?

You are quite correct. I closed an MBNA card a few years ago but forgot to cancel the RAC recovery. Sure enough, it went through about two months later. MBNA were very good and alerted me to the fact before any charges were incurred.