possible 25k in unenforceable debt: MBNA & Barclaycard - what to do next?

IndyScot2020

Hi all,

First timer poster from Scotland here. Thanks for all advice in this section of this forum and those like myself who also started using all about debt (is that ok to say that here?!)

my story: accumulated almost £50k in unsecured debt in summer 2015 and entered into a Debt Arrangement Scheme to bring debt down. Although I'm paying 8% in admin fees for this arrangement, it has benefit of protecting from legal proceeding stuff while on DAS and currently on a 6 month holiday payment. now down to around £36k in debt after paying around £350 a month for last 3.5 years or so.

HOWEVER as many expert forum readers&posters will no doubt be aware ... I should should have carried out CCA check before DAS, which I failed to do until September this year. Some really promising news to follow regarding enforceability, but would welcome any advice on next steps.

Here's the readout starting with three largest creditors showing on my DAS account:

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Account type: Arrow Group, managed by Capquest (previously owned by MBNA)
Opened: Sep 2006
Balance: £10,784
Repayment plan started: June 2015
Last payment: Sep 2018
Default date: May 2015

CCA request sent Sep 2018. Capquest have since put account on hold and wrote in Sep & Nov to say they are still waiting to hear back from MBNA.

update: 13 Dec 18: received letter from Capquest saying "Please be advised we have passed your request for the copy of the agreement to the relevant department and will be contact in due course. This account will not be subject to collection activity pending provision of the requested documentation."

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Account type: Arrow Global Group, managed by Capquest (previously owned by MBNA)
Opened: Sep 2007
Balance: £5,157
Repayment plan started: June 2015
Last payment: Sep 2018
Default date: May 2015

CCA request sent Sep 2018. Capquest have since put account on hold and wrote in Sep & Nov to say they are still waiting to hear back from MBNA.

13 Dec 18: received letter from Capquest saying "Please be advised we have passed your request for the copy of the agreement to the relevant department and will be contact in due course. This account will not be subject to collection activity pending provision of the requested documentation."

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Account type: Barclaycard
Opened: Jan 2012
Balance: £9,200
Repayment plan started: June 2015
Last payment: Sep 2018
Default date: N/A

AAD advise this barclaycard account is unenforceable! :rotfl: due to missing signature and only generic terms supplied.

13 Dec 18: Arrears notice letter. Please call to discuss.

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other mixture of smaller debts totalling £11k debts with Nationwide, Bank of Scotland and Hitachi, but they all appear enforceable. trying to negotiation 50-60% F & F, but will try again in new year.
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any advice what do to next regarding barclaycard & Arrow Group?? worth writing to barclaycard dispute soon to offer 10% F & F?

thanks

sourcrates

Hi,


It can take up to a year for the debt purchasers to obtain the requested paperwork from the original creditors, the accounts concerned will remain (temporarily) unenforceable until they do respond with what they are supposed to.


As regards the Barclaycard account, a signature is not always required on any copy agreement requested under sec 77/79, and the fact a few terms are missing does not mean a good solicitor, on a good day, could not convince a judge the debt is legitimately owed.

Sometimes these things do get tested in court, and in order to win, you need to have as many weapons in your arsenal as you possibly can, the only reason a lot of these creditors don`t take these matters all the way is down to time and cost constraints.

Barclaycard may very well just roll over if you tell them you believe the debt is not enforceable, they may even accept a low offer to put it to bed, but it will be down to the fact they cannot be bothered to pursue the account rather than lack of a few terms and a signature.

Just_Di

IndyScot2020 wrote: »

and those like myself who also started using all about debt (is that ok to say that here?!)

It's fine by me to mention All About Debt since I've already been posting on your thread on that forum

You've had an opinion on the unenforceability of a credit agreement from someone who has seen it which is a good thing because there are conflicting opinions on when signatures, dates (including the execution signature and date), prescribed terms and Ts & Cs (which must be 'together' with the credit agreement when it is signed) etc are necessary.

A s77-79 CCA Request is for 'information' purposes not 'proof' purposes. A debt owner can send you 'something' which satisfies s78 but that 'something' may not satisfy other sections of the Consumer Credit Act so the debt could be unenforceable.

This was the case in Santander v Diana Mayhew (me ) where you'll see from Paragraph 14 of the judgment that I lost the s78 argument (because they sent me 'something') but won on all the other legal arguments because the 'something' was fatally flawed >

Link to judgment > http://www.bailii.org/ew/cases/Misc/2012/14.html

Di

Just_Di

sourcrates wrote: »

a signature is not required on any copy agreement requested under sec 77/79, and the fact a few terms are missing does not mean a good solicitor, on a good day, could not convince a judge the debt is legitimately owed.

Sometimes these things do get tested in court, and in order to win, you need to have as many weapons in your arsenal as you possibly can

If a Defendant is also represented by a good solicitor on a good day then they would appeal any decision made by a judge if they (DJ) made an error of law. A judge may be easily persuaded (i.e. convinced) but the law may say otherwise.

And a good solicitor for the Defendant would raise as many legal arguments as possible at the Defence stage (or before then using CPR 31.14 and Part 18 Questions) on issues like assignment and lack of FCA authorisation issues, 'bad' Default Notice (or no evidence of DN correctly served), failure to comply with other statutory duties such as bi-annual Notice of Sums in Arrears and so on.

The more times we win cases the more judgments there are to help consumers defend these claims which in turn educates the judges who aren't all prejudiced against debtors once they realise it's a legal argument not a moral argument.

Di

sourcrates

Just_Di wrote: »

If a Defendant is also represented by a good solicitor on a good day then they would appeal any decision made by a judge if they (DJ) made an error of law. A judge may be easily persuaded (i.e. convinced) but the law may say otherwise.

And a good solicitor for the Defendant would raise as many legal arguments as possible at the Defence stage (or before then using CPR 31.14 and Part 18 Questions) on issues like assignment and lack of FCA authorisation issues, 'bad' Default Notice (or no evidence of DN correctly served), failure to comply with other statutory duties such as bi-annual Notice of Sums in Arrears and so on.

The more times we win cases the more judgments there are to help consumers defend these claims which in turn educates the judges who aren't all prejudiced against debtors once they realise it's a legal argument not a moral argument.

Di

I agree completely, its just the word "unenforceable" is thrown around quite a lot these days, and we automatically presume we will not be challenged on that assumption, if or when we use it as a defense against paying the debt because of incorrect paperwork.



The usual scenario is that the creditor backs down, or plays there hand right up until the end, then simply does not turn up in court, people just need to be aware that they could end up before the bench and having to rely on these threads of information as a defense, and it could get costly for them, used as a bargaining tool to obtain a good settlement is possibly the safest option.

IndyScot2020

Just_Di wrote: »

The more times we win cases the more judgments there are to help consumers defend these claims which in turn educates the judges who aren't all prejudiced against debtors once they realise it's a legal argument not a moral argument.

Di

good point Di & part of reason I'm posting this on AAD & MSE too - to hopefully share knowledge to others who might be in a similar position. though for me personally I'd like to research more about where I stand legally, to help developed an informed opinion of my own on the whole enforceability test here and to be weaponised as the other poster I think put it. helpful in any future negotiations.

( 'future negotiations' ...Westminster, if you are reading this (a long shot admittedly) take note of my brilliant strategy as you guys head into legal battle with Spain over Gibraltar )

IndyScot2020

sourcrates wrote: »

I agree completely, its just the word "unenforceable" is thrown around quite a lot these days, and we automatically presume we will not be challenged on that assumption, if or when we use it as a defence against paying the debt because of incorrect paperwork.



The usual scenario is that the creditor backs down, or plays there hand right up until the end, then simply does not turn up in court, people just need to be aware that they could end up before the bench and having to rely on these threads of information as a defense, and it could get costly for them, used as a bargaining tool to obtain a good settlement is possibly the safest option.

apologies if I came across like I was taking for granted the accounts are 100% unenforceable, Sourcrates, which I accept of course cannot be guaranteed. It is an opinion, an informed opinion, that I have at this stage, so trying to tread cautiously and as you rightly say be ready for possibility that they may come up with enforceable CCA at later date.

Just a great feeling to get my first opinion suggesting its UE. Though of course I'm not a legal expert, I felt the Barclaycard CCA looked ... odd, different in comparison to the others. Not just the missing signature, but it had odd papers inserted with my CCA in different way different fonts and some papers (like the 'right to cancel') which were headed 'restricted internal' - suggested to me at least they weren't included in either my original application or signed CCA (if there ever was one).

anyway, think we are all agreed a likely UE could well be as you say a VERY useful bargaining tool as I consider heading down the probably safest route of v low F&F offer.

Just_Di

sourcrates wrote: »

its just the word "unenforceable" is thrown around quite a lot these days, and we automatically presume we will not be challenged on that assumption, if or when we use it as a defense against paying the debt because of incorrect paperwork.

The usual scenario is that the creditor backs down, or plays there hand right up until the end, then simply does not turn up in court, people just need to be aware that they could end up before the bench and having to rely on these threads of information as a defense, and it could get costly for them, used as a bargaining tool to obtain a good settlement is possibly the safest option.

I hope I've explained the difference between an unenforceable credit agreement and an unenforceable debt which could have a perfectly executed credit agreement, but still not be enforceable in court for other legal reasons.

If no credit agreement or a reconstituted credit agreement is produced following a s 77-79 CCA Request then there's always the potential for it to be disclosed at the eleventh hour, or the flaws in a recon to be remedied before the Trial.

However an irredeemably unenforceable credit agreement cannot be remedied. This can be when the debt owner produces the original (scanned copy) of the credit agreement which was not correctly executed (missing the prescribed terms etc) at the outset. They cannot put the clock back.

In the case of PRA Group (UK) Ltd v Diana Mayhew (me again ) the Recorder (judge) ruled both the agreements were irredeemably unenforceable. The scanned copy of the alleged reverse of the application form with my signature on it (i.e. the "credit agreement") was slightly larger than the scanned copy of the front of the same document, which could not have been possible if it was 'honest an accurate'. We took rulers to court to prove it.

I would never encourage anyone to go into court without legal representation, but at the same time I would encourage anyone who receives a court claim to seek free legal advice from a qualified lawyer - there are some who can offer help on a CFA (No Win No Fee) basis, and also hands on help from various law centres which can be sourced through LawWorks clinics who can sometimes provide pro bono representation in court >
https://www.lawworks.org.uk/

Di

IndyScot2020

update: Arrow Global appear to acknowledge both former MBNA debts are unenforceable. delighted to confirm they have accepted a 12% settlement offer for both accounts - thats a £1.8k settlement for £15k they claim I owned them. Accounts now fully settled and closed !! :-) :-) :-)

Barclaycard - still negotiating - think we are almost there on a settlement figure and agreed a figure on the phone - however proving difficult to get in writing as they want me to pay via the debt payment distributer who are not willing to co-operate, possibly as it means they will lose their distributer fees. trying to exit the DAS debt programme process is the real challenge here - it has to be 'consulted on' first and the distributer and administrator have to agree to it first which takes weeks :-/

Debtfighter

Hi IndyScot2020,

I am in a similar situation to what you were in. I am keen to hear an update if you would be so kind as to mention how you got on with everything particularly with exiting the DAS and what happened regarding your remaining creditors?

Many thanks

sourcrates

OP not been back since last April, so it would be nice to have an update.