Sole Trader, Scotland taken to Court in England - Urgent Help Needed Please

[Vincent1970]

I am based in Scotland, I was a sole trader.

 

A supplier that I used in 2003-2004 came out of the blue in Nov 09 with a series of invoices that he claims were outstanding.

 

This was the first I heard of any amounts unpaid.

 

He is trying to take me to court in England. West London County Court have allocated the case to fast track. I have no money to pay a solicitor myself. Does the court have jurisdiction?

 

According to the1974 Consumer Credit Act a Sole Trader is considered an individual.

 

"(b) an unincorporated body of persons which does not consist entirely of bodies corporate and is not a partnership;”. applies to me a sole trader.

 

The only agreements now excluded from the Act if you enter into them as a sole trader are those over 25K.

I understand that a consumer (sole traders) rights are statutory - they can not just be waved by a company because it suits them. My supposedly outstanding invoices come to £6500 with £3000 interest so I'm under that limit.

 

and

 

I think that under Sectn 41 of the Civil Jurisdiction Act I could argue that the West London County Court does not have jurisdiction and my case should be heard by a Scottish court where the statute of limitations is five years rather than six. In which case they would all be time barred.

 

Since receiving the CCS in November I have been going through an English solicitor who had not used this defence because he 'was not a Scottish law specialist' and felt it would be prohibitively expensive to bring Scottish lawyers in and make this claim.' Since then I had to "sell" my business for no money to protect the fifteen or so staff that were working for me. I had already paid the English lawyer about £5000 to defend my side up till now and can't afford it at all anymore (£25 for 6mins plus VAT).

 

It seems I must represent myself but I have a little boy and no funds to travel to England, and I am a total dunce when it comes to law and 'the system'.

 

Although somebody I spoke to recently said that because I was a sole trader dealing with another business - I did not have a case under the Consumer Credit Act since transactions appear to be a more straight forward sale and purchase transaction. The invoices span a period of a year from 2003 to 2004. well over a year (and because I knew absolutely nothing about them they didn't get paid - credit has run right up till now).

 

Disclosure is due on 28th May - this week. I don't know what I should include in the disclosure docs.

I have to word a very strong defense since I've read on this forum that English judges are very reluctant to acknowledge Scottish Jurisdiction in their courts, even though it may apply.

 

I am very scared, I've got no money, but can't get legal aid in England or Scotland - I fall between the gaps, and need confidence and information.

 

Please help me educate myself and turn this nightmare into a proud, success story for the little guy.

 

Thank you so much in advance if any one has advice. :?

Edited May 24, 2010 by Vincent1970

[IdaInFife]

Hi Vincent and welcome to CAG.

 

 

here is a thread and a couple of links in that thread to help you understand

 

and i'll give a shout to a few of the more knowlegeable folks

 

ida x

[Monty2007]

I am based in Scotland, I was a sole trader.

 

A supplier that I used in 2003-2004 came out of the blue in Nov 09 with a series of invoices that he claims were outstanding.

 

This was the first I heard of any amounts unpaid.

 

He is trying to take me to court in England. West London County Court have allocated the case to fast track. I have no money to pay a solicitor myself. Does the court have jurisdiction?

 

According to the1974 Consumer Credit Act a Sole Trader is considered an individual.

 

"(b) an unincorporated body of persons which does not consist entirely of bodies corporate and is not a partnership;”. applies to me a sole trader.

 

The only agreements now excluded from the Act if you enter into them as a sole trader are those over 25K.

I understand that a consumer (sole traders) rights are statutory - they can not just be waved by a company because it suits them. My supposedly outstanding invoices come to £6500 with £3000 interest so I'm under that limit.

 

and

 

I think that under Sectn 41 of the Civil Jurisdiction Act I could argue that the West London County Court does not have jurisdiction and my case should be heard by a Scottish court where the statute of limitations is five years rather than six. In which case they would all be time barred.

 

Since receiving the CCS in November I have been going through an English solicitor who had not used this defence because he 'was not a Scottish law specialist' and felt it would be prohibitively expensive to bring Scottish lawyers in and make this claim.' Since then I had to "sell" my business for no money to protect the fifteen or so staff that were working for me. I had already paid the English lawyer about £5000 to defend my side up till now and can't afford it at all anymore (£25 for 6mins plus VAT).

 

It seems I must represent myself but I have a little boy and no funds to travel to England, and I am a total dunce when it comes to law and 'the system'.

 

Although somebody I spoke to recently said that because I was a sole trader dealing with another business - I did not have a case under the Consumer Credit Act since transactions appear to be a more straight forward sale and purchase transaction. The invoices span a period of a year from 2003 to 2004. well over a year (and because I knew absolutely nothing about them they didn't get paid - credit has run right up till now).

 

Disclosure is due on 28th May - this week. I don't know what I should include in the disclosure docs.

I have to word a very strong defense since I've read on this forum that English judges are very reluctant to acknowledge Scottish Jurisdiction in their courts, even though it may apply.

 

I am very scared, I've got no money, but can't get legal aid in England or Scotland - I fall between the gaps, and need confidence and information.

 

Please help me educate myself and turn this nightmare into a proud, success story for the little guy.

 

Thank you so much in advance if any one has advice. :?

 

You are correct, you live in Scotland and are not subject to English jurisdiction. If they are daft enought to serve the summons on you then you should respond pointing this out.

 

In the meantime, I would dispute the invoices and try to find out what claim this person has against you.

[mystery1]

Does the statute of limitations apply if they are real ? It's 5 years up here.

 

M1

[seriously fed up]

It can be a wee bit hairier than that Monty.

I had some involvement recently in a case that involved jurisdiction. Its not quite the same, in that the guy in this case first of all had a CCJ that he needed to have set aside (this was on the basis he had not received the court papers), but having done that Barnsley CC was minded to hear the case, despite the fact that he was an employee, had only ever lived and worked in Scotland and that the Civil Jurisdiction and Judgements Act was quite clear the case could only be heard here. Just to put the tin lid on it, the other side (his former employers) were basically trying to reopen the issue of compensation for his unfair dismissal which had been determined by a Scottish Employment Tribunal three years earlier.

You can find the thread in question here http://www.consumeractiongroup.co.uk/forum/scotland/240289-ccj-registering-england-3.html - I have referenced where I come in, but you will probably find the whole thing illuminating. You will find the Civil Jurisdiction Act referenced at post 30 - you need to have a look at that.

YOu should have a good look at schedule 8. I take your point that under the Consumer Credit Act you are an individual (and thus a consumer), BUT Rule 3.1 says that

"3(1)In matters relating to a contract concluded by a person, the consumer, for a purpose which can be regarded as being outside his trade or profession, subject to rule 5, jurisdiction shall be determined by this rule if—(a)it is a contract for the sale of goods on instalment credit terms; or

(b)it is a contract for a loan repayable by instalments, or for any other form of credit, made to finance the sale of goods; or

©in all other cases, the contract has been concluded with a person who pursues commercial or professional activities in Scotland or, by any means, directs such activities to Scotland or to several places including Scotland, and the contract falls within the scope of such activities."

Its the bit in bold that really worries me, because I would guess that the other side would say it was part of your trade and profession. I dont suppose you still have the terms and conditions for the sale do you? That is likely to say the in case of dispute "the law of England will apply" (it usually does say that or something like - though that can be set aside by the Civil Jurisdiction etc Act, though companies you are in dispute with wont often tell you that - pointing to their T&Cs). Mind you if the other side dont have a copy of the same document they might be in difficulties. I think you need to get some fairly expert advice on this.

In literal terms Monty is right that the English court lacks jurisdiction, but it doesnt always happen that way (as the thread above indicates) - the court gets told it has jurisdiction and in "ignorance" (or arrogance) they come to a judgement that they have no right to make. But the judgement gets made, a CCJ issued and it all has to be unravelled.

Btw, re statute barring, if this does get heard in London it WILL be 6 years because it wont just be an English court but English law as well. The fact you are Scottish wont help you there.

I would

 

1. get some professional advice on jurisdiction - try your local CAB or you could try Gova Law Centre (though if you are outside their area they might not want to know) - about jurisdiction for a sole trader. If you cant get any proceed on the basis that you are indeed a consumer.
   
2. if its as we would hope (or you just cant find out), you need to get a defence into the Court denying jurisdiction very strongly.
   

[Monty2007]

You may be correct SFU. I had thought that he was, in law, treated as an individual given he was a sole trader as opposed to a business - hence any action had to be served in the relevant jurisdiction. I read something on this a while ago but can't locate it.

 

I am also thinking that the court would have not served the papers?

 

I agree, the OP needs to see a solicitor or Citizens Advice, I would not wish to give incorrect information.

 

Please let us know the outcome, although I would still suggest getting to the bottom of his complaint and case against you.

[seriously fed up]

I hope you are right Monty. Before being involved in the case referenced, I wouldnt have doubted it. But what this showed was a willingness for papers to be issued by English courts simply by virtue of the claim being made. Yes, courts do issue papers. I you have a look at the other thread you will see that Barnsley CC heard the case for the set aside - which had to be a judge - and then put the case down for full hearing, in full knowledge of the residence of the defender. If these cases arent resisted - even on jurisdictional grounds - then a judgement gets issued. Hopefully Vincent can fight them off by being able to deny jurisdiction to the London court. If he had been an employee there would be no problem - its the bit about being in business for himself and the contract being associated with that business that I am just not sure about. Hopefully we will discover the real situation.

I would agree very much with your final comment btw as even if he fights them off on jurisdictional grounds it may only be a temporary win if they simply bring the case up to Scotland andn win (possibly adding expenses?)

[Coactum]

In my opinion Sole Trader is irrelevant because if you are domicile in Scotland (or if you had been a signitory of a Limited company registered in Scotland) both now and at the time the alleged debt arose then a Scottish Court has jurisdiction. If you signed any contract with the supplier that stated English Law would apply then they have to bring the case to Scotland and try under English Law within a Scottish Court which is rather strange but permissible. However, as the case has been raised in London you must first get this English Court to accept that they do not have jurisdiction and then once over that hurdle present the limitation expired defence.

[seriously fed up]

Coactum makes the key point when he says

"However, as the case has been raised in London you must first get this English Court to accept that they do not have jurisdiction and then once over that hurdle present the limitation expired defence."

because if you dont you will end up with a ccj and at the very least having to get it set aside for non jurisdiction.

Coactum, you suggest that as long as he is domiciled in Scotland - even if as a sig of Limited Company - its the Scottish Court which has jurisdiction. My reading of the Civil Jurisdiction and Judgements Act that this is indeed the case if he were an employee or the case concerned a Consumer Contract. This is clear from Schedule 8. But, by virtue of being self employed and the contracts being litigated being in connection with his profession or trade I am just not wure. What law would you refer to in order to support the view you have put forward. If he is to persuade the London Court the more his argument about non jurisdiction is supported by statute (and even precedent) the better.

[Coactum]

A self-employed person is in effect an employee of their own company regardless of the structure of that business. When referring to profession I would suspect that we are looking at legal, finance, medicine and the likes. If on the other hand Vincent was say a retailer who buys goods for his shop from a supplier in a regular business to business contract he is in this instance no different from a consumer who in turn buys the goods in a regular b - c transaction.

[Coactum]

SFU seems to have carefully studied Civil Jurisdiction Act already which I have found at http://www.opsi.gov.uk/RevisedStatutes/Acts/ukpga/1982/cukpga_19820027_en_22#sch11 and now recognise his concerns. I think that if Vincent1970’s business dealings with the other company were as an end user then it is reasonable to take the stance that he is the consumer must be sued where he is domicile. If the contract was anything else then the case may be harder to argue.

 

Can you please clarify the nature of the relationship between you and the other party please Vincent1970?

[seriously fed up]

I see from your initial post Vincent that you sold the business, and at that time it had 15 staff. What was/is the legal status of this business - were you working in your own name or did it have some kind of company status?

Also, a bit confused why, if you sold the business, the claim is being brought against you, and you personally, if you dont own it any more? If the business had its own legal identity (Joe Bloggs & Co) then the contracts would be with Joe Bloggs & Co. Its only if you were trading in your own name - Joe Bloggs - and the contracts were with you on a personal basis (even though you knew nothing about it - done by an employee) that you would be liable.

So, to help you further we really do need to know on what legal basis you carried on business - was it as plain old Joe Bloggs? Or as Joe Blogg & Co?

If the former then I would be more confident about you being able to use Civil Jurisdiction etc Act. If the latter, I wouldnt be so sure, but I would have thought it would be possible to apply to have the case set aside as the debt isnt yours - its not Joe Bloggs (you) who entered into the contract but Joe Bloggs & Co (the business) and that's not you (it might bear your name, but it has a separate legal identity) and besides you have sold it. So the argument would be - basically - nothing to do with me gov!

As for your English solicitor not being a "a Scottish law specialist" - that is just total bollocks. This is NOTHING to do with Scottish law - the Civil Jurisdiction etc Act 1982 is UK Legislation, and concerns jurisdiction on a world-wide basis, and certainly not just Scotland. The guy just didnt know Vincent. I would be very interested to learn - if you want to tell us - what he did for the £5k you gave to him, because it sounds like the square root of not very much. (with your solicitor btw)

On the other hand, I am afraid I suspect you are almost certainly right about "English judges are very reluctant to acknowledge Scottish Jurisdiction in their courts, even though it may apply. " and needing a strong defence. Combination of arrogance and ignorance - always a bad cocktail :evil:

[Coactum]

Many good points again SFU. I look forward to hearuing vincents reply.

[Vincent1970]

Folks,

Thank you so much for your replies - I'm sorry I've been off line for a bit I've been doing mad research trying to establish the strengths and weaknesses of my case and how to progress.

 

To answer your question SFU about the status of the company - I was a sole trader from 2001 - 2005 then became a ltd co. and have just sold, so the invoices supposedly incurred were from a time when I was sole trader and I'm still personally liable for them.

 

In the English system you have 28 days to respond to papers being served with a question of appropriate jurisdiction - the English court system web site is really helpful and has all of the down loadable forms and guidance notes. Unfortunately I didn't realise this and that deadline has passed but I think I might be able to write to the judge c/o the court and explain position - either/and request that the trial relocates to scotland. It's a bit complicated - I know I'm on shoogly ground with Jurisdiction just because it's commonly used for private individuals rather than commercial law and it's 50-50 how the judge reads it. Silly to say it's still a matter of interpretation. I have to be solid and argue my case as strongly as I can - within the limits of a court form. But I will also be applying to have the case automatically transferred to Scotland - if I can assure myself that Scottish law applies rather than English law 'carried over'.

 

The terms of the contract were simply "please send cheque on delivery" which I would have done if we had recieved and statements or reminders. I don't think I can prove that we didn't receive the goods (it was so long ago) but I think I can prove that we did npt recieve any invoices/statements/or reminders that a normal supplier paper trail would have.

 

As for what my English solicitor did for the ... now £6000 (since I got my final bill) not much, not much at all. Even worse a Scottish solicitor I went to see about getting legal aid - but then said couldn't help - has just sent me a bill for £500 for 1 half hour meeting and 1 initial brief meeting and no correspondence; He has charged £38 plus vat to send out his bill, and £15 to read an email from me chasing an answer to a previous email that he hadn't answered.

 

I'm rushing just now, but felt I had to reply to say thanks so much for taking the time to reply. Will write more as soon as I find out what will happen - so that this thread will be as useful as I can make it for someone else going through the same agony.

 

Vin