DCA's and the Law of Property Act

[pmhcfc]

All,

 

I'd like to reopen this particular discussion; that being the

way DCA's purchase debts (alleged or otherwise).

 

Now the more experienced of you will know we established

long ago that Cabot purchase their debts in this manner. It

has now been proved that Lowells also do the same. I'm left

wondering if this is how all DCA's operate in respect of purchasing

debts. I'd really like to establish exactly what it means when they do this.

 

I know that Cabot use the LoP as an excuse for not having to

produce on a CCA request, maintaining that under the LoP Act 1925

the 'rules' do not apply. I'm left wondering if this has ever really

been looked in to. It's laughable to think that these DCA's are

relying on an 80 year old act to do what they do. Is there a

loophole in all of this I wonder? Are they really doing things by

the book in respect of the LoP Act? Has anyone ever looked into

this properly to see if it can be challenged? Is a debt, property? - None

of us, when taking out a loan/CC etc ever sign anything that pertains

to the LoP Act 1925.

 

Cabot and Lowells (and probably all the rest) will point you in the

direction of Section 136 of the said LoP Act. Below, I have cut and pasted something I looked up last year when I was 'researching' Cabot. --I know, from a court case from years ago when a lawyer successfully defended his client, who was being sued for monies under the LoP Act--

 

I know this might be a lot to take in, but It'd be great if we can get some real constructive feedback on this. After all, one never knows what might turn up. If there is something, that kind-a stuffs a DCA or three eh?

 

136. Legal assignments of things in action.- (1) Any absolute assignment by writing under the hand of the assignor (not purporting to be by way of charge only) of any debt or other legal thing in action, of which express notice in writing has been given to the debtor, trustee or other person from whom the assignor would have been entitled to claim such debt or thing in action, is effectual in law (subject to equities having priority over the right of the assignee) to pass and transfer from the date of such notice-

(a) the legal right to such debt or thing in action;

(b) all legal and other remedies for the same; and

© the power to give a good discharge for the same without the concurrence of the assignor:

 

Provided that, if the debtor, trustee or other person liable in respect of such debt or thing in action has notice-

(a) that the assignment is disputed by the assignor or any person claiming under him; or

(b) of any other opposing or conflicting claims to such debt or thing in action; he may, if he thinks fit, either call upon the persons making claim thereto to interplead concerning the same, or pay the debt or other thing in action into court under the provisions of the Trustee Act, 1925.

 

‘Interplead’: to go to trial to resolve which of several claimants has the right to claim money or property held by a third party

Edited November 29, 2008 by pmhcfc

[flyingdoc]

just my thinking but surely to satisfy the

from whom the assignor would have been entitled to claim such debt or thing in action

would have to be proved to make the assignation of the debt legal.

 

if the original debt could not be proved, then it could not be assigned.

[popeye1]

Shold they give debter notice befor date of ass as,,,in writing has BEEN given to the debter,

[pmhcfc]

Ok...There's many (possible) points to pick up on in this but, for now, what about this:

 

Provided that, if the debtor, trustee or other person liable in respect of such debt or has notice-

(a) that the assignment is disputed by the assignor or any person claiming under him;

 

What is the legal term regarding the use of the word: 'assingment' ?

 

My point is; The DCA has a legal right to the debt if the assingment is disputed by the assignor (original creditor) or any person claiming under him. Surely the DCA isn't the person claiming under him, because they now own the debt, they're not acting on behalf of the assignor.

Edited November 29, 2008 by pmhcfc

[flyingdoc]

A transfer of rights in real property or personal property to another that gives the recipient—the transferee—the rights that the owner or holder of the property—the transferor—had prior to the transfer

[pmhcfc]

A transfer of rights in real property or personal property to another that gives the recipient—the transferee—the rights that the owner or holder of the property—the transferor—had prior to the transfer

 

Yes, but that's the rights of the DEBT itself- not the agreement you've signed. Surely meaning they can't charge you any interest?

 

You see, this is where Cabots (and others) are trying to hide. They say they dont have to

supply you with the original agreement (CCA request) because they own the debt and not

the agreement - which, as per the LoP, is how I read it. But if it's the agreement that

stipulates how much interest you have to pay, then you can argue you didn't borrw that

interest, only the original debt.

 

This is where they want it both ways...Point (b) states: all legal and other remedies

I think the DCA's are trying to say 'other remedies' mean the chargable interest, but not the rights to supply you with original agreement.

 

For example:

 

Cabot: Mr x, we dont have to supply you with the original argeement because we dont own it. It's only under the agreement T & C's do we have to supply that.

 

You: Ok then, I'm not paying you interest on the debt because it's only under the agreement T & C's where I have to pay said interest.

Edited November 29, 2008 by pmhcfc

[pmhcfc]

I'm not even convinced a DCA (on thier own) can take you to court if they buy a debt under the LoP Act 1925...Read this;

 

However, there is one very important procedural consequence which attaches to the distinction. A statutory assignee can sue without joining the assignor as a party to the action, whereas an equitable assignee often (although not always) cannot do this. Furthermore, a statutory assignment passes a legal right to the assignee, an equitable assignment passes only an equitable right.

 

So, in this case, when they buy a debt and if they want to collect the interest as well, the assignment has to be absolute. If the assignment is absolute, they are bound by the CCA, because of the CCA the rights and duties are assigned. A duty is not an obligation, as an obligation is a possible financial loss, whereas as a duty is to comply with the CCA.

Edited November 29, 2008 by pmhcfc

[ScarletPimpernel]

My view has always been that even if the LOP provides for a transfer of rights only (which is Cabot's view), then the s.189 of the CCA 1974 is clear that an assignment is of rights and duties; it doesn't provide for an assignee to make a choice of one or the other.

[pmhcfc]

My view has always been that even if the LOP provides for a transfer of rights only (which is Cabot's view), then the s.189 of the CCA 1974 is clear that an assignment is of rights and duties; it doesn't provide for an assignee to make a choice of one or the other.

 

Indeed, but as I've said (albeit on an edit lol) - if Cabot want to charge interest, then the debt would have had to have been assigned as absolute. So if it's absolute - they have to comply with a CCA request as that is a duty.

[Fred Bassett]

Indeed, but as I've said (albeit on an edit lol) - if Cabot want to charge interest, then the debt would have had to have been assigned as absolute. So if it's absolute - they have to comply with a CCA request as that is a duty.

 

How would you know if the assignment is absolute?

 

Fred

[ScarletPimpernel]

How would you know if the assignment is absolute?

 

Fred

 

 

I usually ask when making a CCA request.

[pmhcfc]

How would you know if the assignment is absolute?

 

Fred

 

That's the 64,000$ question I suppose. Perhaps you could call Cabot's bluff and tell them they're not allowed to collect any interest (if they

can prove debt in first place that is) because you believe the assignment

is equitable seeing as they (Cabot) say they do not have to comply with the CCA request.

 

After all, Cabot would know that the only reason they wouldn't have to comply was if it was equitable.

[themajor]

They are partly right. You probably requested a copy of the deed of assignment with your CCA request? I presume you've done a CCA request. Well the LOP 1925 does mean that they don't have to provide the actual deed itself but some formal notification of their right to collect on this account. If they're trying to make out that it means they don't have to provide you with the CCA then they're just bluffing. I've had this before I think it was 1st Credit Ltd who tried it on me. Just acknowledge they don't have to give you an actual deed of assignment and keep requesting the CCA.

[cashins]

Seem to remember PT2537? gave an opinion that Cabot were talking through their backsides regarding LPA, with some reasoning, but where you would find it, no idea.

 

David

[Newborn]

I've posted this link elsewhere, but it is one author's take on assignment regarding both who can serve a NoA and what burden the assignment places on the assignee.

 

Newborn

[pmhcfc]

I've posted this link elsewhere, but it is one author's take on assignment regarding both who can serve a NoA and what burden the assignment places on the assignee.

 

Newborn

 

Thanks for this...

 

I've seen an agreement between Cabot and the company (who will remain nameless) they purchased debts from. Nowhere in that agreement does it refer to the point that the debt/s is/are being purchased under the LoP Act, so how can Cabot claim they purchased the debt in this manner?

 

Another point; The LoP Act says: the debtor may, if he thinks fit, either call upon the persons making claim thereto to interplead concerning the same, or pay the debt or other thing in action into court under the provisions of the Trustee Act, 1925.

 

(‘Interplead’: to go to trial to resolve which of several claimants has the right to claim money or property held by a third party)

 

Doesn't this mean one could take Cabot (for eg) to court to prove they have the legal right to collect any debt? LoP Act also says :

The debtor interpleading will ordinarily be entitled to deduct his costs.

[pmhcfc]

Thanks for this...

 

I've seen an agreement between Cabot and the company (who will remain nameless) they purchased debts from. Nowhere in that agreement does it refer to the point that the debt/s is/are being purchased under the LoP Act, so how can Cabot claim they purchased the debt in this manner?

 

 

Actually, I've seen two seperate agreements between Cabot and the 'Assignor' ...Not that it has anything to do with this thread but Cabot paid 8p in the £1 for one lot of accounts and 12p in the £ for the other lot

[Fred Bassett]

Actually, I've seen two seperate agreements between Cabot and the 'Assignor' ...Not that it has anything to do with this thread but Cabot paid 8p in the £1 for one lot of accounts and 12p in the £ for the other lot

 

Hi pmhcfc, why the two different ways of buying a debt? What does it mean to the creditor and the debtor?

 

Regards.

 

Fred

[pmhcfc]

Hi pmhcfc, why the two different ways of buying a debt? What does it mean to the creditor and the debtor?

 

Regards.

 

Fred

 

Assignor (= OC) Asignee (=DCA) Debtor (= you)

 

It all depends on the agreement signed between Assignor and Asignee for a batch of accounts. Some batches the DCA would pay 8p (in the £) for, some 12p and so on.

 

In these agreements, there is no mention of the LoP Act but they do say 'These account are sold by way of assignment'.

 

I have a hunch that Cabot buy (or at least bought) debts under equitable assignments, thus avoiding having to pay stamp duty at the time. If my hunch is correct, it really could have a major bearing...especially if you read what I've been reading in respect of equitable assignments and the LoP Act.

[FANTASY CHARGES]

as background reading it is suggested that we all read the following 2 posts of a cabot witness statement .......... the words actually come from cxabot themselves

 

http://www.consumeractiongroup.co.uk/forum/show-post/post-1554167.html

 

 

http://www.consumeractiongroup.co.uk/forum/show-post/post-1554169.html

 

look at points 3.8 THE WORD LICENSED

 

and 3.9 THE WORDS FORWARD FLOW AGREEMENT DATED 20TH DECEMBER 2004........................ does this forward flow agreement mention the law of property ???

[FANTASY CHARGES]

Term: assignment of contract

1.

Unless a contract provides otherwise, the liabilities and duties under a contract may not be assigned, in contrast to the benefits under a contract which may be assigned without the consent of the other contracting party.

For instance, suppose A engages B to perform a service in consideration of the sum of £10.00. The 'liabilities and duties' of A are to pay £10.00, and A's 'benefits' under the contract is to receive the service. From B's perspective, the 'liabilities and duties' of the contract are to perform the service, and the benefit of the contract is to receive the £10.00. A is not entitled to assign the obligation to pay B the £10.00, unless B consents. Likewise, B is not entitled to assign the obligation to perform the service to a third party unless A consents.

Although most professionally drafted contracts expressly prohibit such assignments, the provisions to prohibit an assignment of a contract are redundant.

In order to assign the burden of performance under a contract to a third party, the contract must be novated. Novation takes place when all three parties - that is, the current contracting parties and the incoming party who will take on the performance obligations - enter into a contract effectively stating that the outgoing party with a duty of performance will no longer be obliged to perform and the incoming party will take on those performance obligations.

 

REGARDING THE ABOVE if a contract (the original terms and conditions) do not state the liabilities and duties are assignable then it is suggested that they cannnot be !!!! consequently it is suggested that any assignment must therefore be equitable ????

 

views please

[Vulture_Bank]

suggest you refer to this thread in particular the generous offer made by pt2537 on post 5 !!!

 

"halsbury eat your heart out "

 

http://www.consumeractiongroup.co.uk/forum/debt-collection-industry/122201-more-secrets-about-assignment.html#post1260656

[Newborn]

Just to fill the gap on forward flow agreements (and see who it was written by).

 

Newborn

[FANTASY CHARGES]

think we all need to look at two post by fantasy on a ver y heavy reading thread from 2007

 

 

 

 

 

http://www.consumeractiongroup.co.uk/forum/show-post/post-1058351.html

 

the second thread is believed to be more important

 

http://www.consumeractiongroup.co.uk/forum/show-post/post-1277921.html

 

 

the actual thread is here

 

 

http://www.consumeractiongroup.co.uk/forum/general-consumer-issues/109003-securisation-what-how-affects.html#post1277921

Edited December 5, 2008 by FANTASY CHARGES
edddditted

[FANTASY CHARGES]

this little gem taken from a royal bank of legal scotland securisation document ( naturally in the public domain has turned up)

 

"FAILURE TO NOTIFY CARDHOLDERS OF THE TRANSFER OF RECEIVABLES COULD DELAY OR REDUCE PAYMENTS ON YOUR NOTES

 

each assignment passes good and marketable title for that receivable to the receivables trustee and each Scottish declaration of trust is effective to hold good and marketable title for that receivable on trust for the receivables trustee, in each case together with the benefit of all collections and other rights in connection with it, free from encumbrances of any person claiming on it through its originator and (except in certain cases where a court order may be required under the terms of the Consumer Credit Act) nothing further needs to be done to enforce these rights in the courts of England and Wales, Scotland or Northern Ireland, or any permitted additional jurisdiction, without the participation of its

originator, except for execution of an assignation in respect of Scots law governed receivables and giving a notice of assignment to the relevant cardholder and subject to any limitations arising on enforcement in the jurisdiction of the relevant cardholder;

 

A ‘‘non-conforming receivable’’ is a receivable arising on a designated account where the

relevant credit agreement would be enforceable on an order of the court only but where the court

would not have discretion to grant an enforcement order in respect of such credit agreement as of

the applicable pool selection date or additional selection date, as the case may be. A non-conforming receivable will be treated as an ineligible receivable on the date it is identified