Yesterday we faced 1st Credit Finance limited in Court. Their Claim failed to get out of the starting blocks in reality.
The case involved a debt which had originated from the Defendants company, the company had a bank account and loan,which were supported by a personal guarantee (PG). There was also PPI on the loan which covered the Defendant in a personal capacity.
The company was placed into administration, and administrators were appointed to deal with the orderly shutting down of the company.
The debt was then allegedly sold to the Claimant, and a claim was issued to recover monies under the PG . The Claimant disclosed statements of account which suggested that the debt had already been paid. Now its important to point out that this was not just a simple charge off which is performed when the creditor sells the account, this was in fact a number of payments shown as coming into the account.
The problem which the Defendant had was simply that as the administrators dealt with the company , the Defendant did not have any involvement and therefore couldn’t know whether the administrators had paid the monies in, or whether the PPI had paid out. So the Claimant was put on notice of this issue and asked to clarify this point, which they failed to do.
The second issue which arose out of the papers, was whether on the true construction of the deed of assignment, could it be said that the Claimant had been assigned the Defendant’s debt. The deed specified the type of accounts, being those which had been debt collection process exhausted, and specified that here were certain conditions that had to be met for the transfer to be effective.
The third issue which arose was whether or not the notice of assignment was compliant and sufficient to give notice of the transfer of title to the debt under s136 LOPA 1925.
The notice did not specify the accounts, it did not specify the account numbers, it in fact did very little apart from referring to the router account number which never gets disclosed to the consumer in normal circumstances. The Defendants evidence was that the notice was unclear and that had it been received ( there was a dispute over its arrival) then it wouldnt have given a clear indication that this account had been assigned.
The matter came before the County Court on 11th May 2017, the Claimant had amended its pleadings, we had amended the Defence, the Claimant failed to file a reply, and in terms of witness evidence, to say it was lacking was probably the biggest understatement ever.
The evidence from the Claimant came from a solicitor not employed by the Claimant but from a separate company entirely, 1st Credit Limited. The solicitor had to accept that she had no direct knowledge of the assignment, she had to accept that she had no direct evidence from the original creditor to say what happened, or why the statements had entries showing the debt paid off, she couldn’t say whether the PPI had paid out, in fact apart from supposition and surmising she couldn’t say much at all.
On the flip side, the Defendants arguments were robust and extensive, the Defendant raised a number of propositions all of which were sound, the Claimant had it stopped and thought about it, could have sought the answers, but it didn’t, it appeared to forge on with an arrogant view that it was simply going to steam roller the Defendant. Sadly for the Claimant, the Defendant was represented and we had a good amount of experience of dealing with this issue. For example i blogged about PRA Group UK Limited whose claim failed in PRA v Brunt due to the bad assignment, and i have had a number of MKDP and Hoist cases which were defended due to no evidence of assignment.
We instructed Imogen Halstead from No5 Chambers, Imogen was excellent, she dealt with the case exactly as per the instructions and was an excellent advocate in Court.
The Judge ruled that, while he accepted there was a notice which on its face could be said to comply with the LOPA 1925, he did not accept that there was a debt that had been assigned. The Judge ruled that even with the two witness statements of the Claimants solicitor there was not enough to be satisfied that there was an account that had been assigned and the Claim failed.
The Judge dismissed the Claim and ordered the Claimant to pay a considerable sum of costs.