Welcome Finance PPI and Mr Z ** SUCCESSFUL OUTCOME **

[steven4064]

THere are certain relationships which are fiduciary just because of what they are - for example, there is case law that says that, whereas the normal relationship between a bank and its customers is that of debtor and creditor, when a bank acts on a customer's paying instructions (eg by paying a cheque), the relationship is fiduciary. The relationship between a trustee and a trust is always fiduciary and so is the relationship between an agent and principal.

[MrZ]

These are both very good points and are helpful for me to be prepared with possible arguments and counter arguments. Keep in mind that the commission aspect is not my main argument. It is secondary to the admited mis sale. Another arrow in my quiver if you will.

 

Whilst I intend to be fully prepared should this actually go to hearing, I expect an offer to settle before it get that far. I have spoken to the court again. My application for the underwriting sheet still hasnt been seen by a judge. I have to serve my POC by Wednesday and no later than Thursday in order to allow time for post.

 

So assuming my application isnt seen before then I need to polish up the POC. I still have a few questions about the POC, but I will keep researching and will hopefully find the answers. Their solicitors are chasing a copy of the POC so I want to make sure I have it right before I send it off to them.

Edited June 29, 2011 by MrZ

[steven4064]

Getting the POC in is obviously your priority

[MrZ]

I agree. The bulk of my POC is ready. I am just unsure I am stating my requests for relief properly. More specifically, how to ask for more than one possible order. Sort of the "if not this, then that" scenario. If the court wont order the agreement rescinded under the MRA 1967, then I want the court to order certain amounts discharged under the CCA 1974. Maybe it doesnt matter how its worded and the court will order whichever is most comprehensive/effective?

 

On another note, I had some progress toward getting the request underwriting. Because I was trying to consider all possibilities, namely that my application for an order to produce the docs may not be see or ruled in time to submit my POC, I wrote another letter to Welcome. I quoted the claim number of the now issued claim, and reminded them that they havent even acknowledged my previous requests.

 

The next day I received notice from their solicitors that they have been instructed to act for Welcome. So I wrote a letter to the solicitors and made them aware of my multiple requests, and Welcomes failure to respond or acknowledge. I then made a final request to the solicitors for disclosure ,with my intention to notify the court how they respond.

 

I received a response from their solicitors today. They say basically, "whilst there is no specific time frame for reply under 31.12 and 31.15, we will endeavour to respond by 1 July."

 

That puts their reponse 1 day after the last day for me to serve the POC by post. They will be getting them by fax and email then.

 

 

Meanwhile lets see what if anything is forthcoming from them.

Edited June 29, 2011 by MrZ

[MrZ]

Does anyone think it would be worth the time to write Direct Group under 31.17 and ask for the information? What they have an "underwriting sheet" as well or would they should the cost and related commissions in a document of a different type? Also do I have to name the document specifically, or can I simply say "the document or documents which show xyz"?

[pokerking1]

dont see how it can hurt,they might hand them over or tell you your not entitled to them(could prove they exsist) or that they dont exsist nothin ventured............

[MrZ]

dont see how it can hurt,they might hand them over or tell you your not entitled to them(could prove they exsist) or that they dont exsist nothin ventured............

Thats true, I'll post one to them tomorrow.

[MrZ]

Ok, a short update to the thread.

 

I sent the 31.17 request to DG. I have had a reply saying that they confirm they will comply with my request. So now I wait to see if what they send will have any useful info.

 

I have sent the POC to Welcomes solicitors and also filed the POC and certificate of service with court. Welcome have acknowledged the claim and state they intend to defend the entire claim. So now I wait to see what they are going to file as a defense. Incidently, they also responded to my further request for the underwriting sheet, etc. They basically said they arent disclosing anything until the court says they have to.

Edited July 5, 2011 by MrZ

[MrZ]

I have received a copy of the defence today. In a nutshell they start the defence by saying my entire claim is statute barred (because the loan was taken out more than six years ago). Then it seems from my first scan of the defence that Welcome have conveniently interpreted my claim to be against HFS (the broker) rather than Welcome. Aside from that they are basically saying in the defence that I (the claimant) have to prove it.

 

I think I am going to need some assistance in putting the conversations and events surrounding the loan etc into a witness statement in such a way that it can be relied upon, rather than my word against theirs.

Edited July 18, 2011 by MrZ

[MrZ]

Here are copies of the POC and DOC

 

MrZ_Welcome_DOC.pdf

 

MrZ_POC.pdf

 

Any comments are appreciated!

[MrZ]

I thought I would add some notes/responses/questions regarding their defence so that anyone who is able to offer some suggestions will have an understanding of the facts as I see them. The below points correspond with the paragraph numbers in the DOC.

 

1. Is not the cause of action the date of discovery of the mis sale, and not the date the loan/contract was entered into?

 

2. Isn't this just semantics, or does this bear importance?

 

3. Most of the correspondence as well as account statements coming from them shows Welcome Financial Services Limited. Although the loan agreement from 2003 does say Progressive Financial Services trading as Welcome Financial Services. Does this matter?

 

5. Again, does this matter?

 

6. This i find to be absolutely ridiculous. In my POC it is very clear that the agent is an employee of Welcome and not HFS. Here is some background: Initially a loan application was completed for HFS loans. HFS stated that I did not qualify and they were sorry they could not help. That was the end of my dealings with HFS. HFS then (without my knowledge or consent) passed my details onto Welcome. Welcome then contacted me by phone and offered to "help". It was an agent of Welcome who them proceeded to take my details and prepared the loan paperwork etc. At no point did I ever have any discussion with HFS beyond an int ital application. All discussions about the PPI and MIF were with the Welcome employee.

 

7. The loan form contains the word "optional", but the Welcome employee had already clearly stated that if the insurance was not taken the loan would not be approved. Additionally when the forms were given for signature, the insurance and MIF were already included. No where on the form is there a tick box or other indicator that the insurance was explained and that I chose to accept the terms of the insurance.

 

8. Again it was Welcome not HFS.

 

9. I cant prove this because they refuse to provide the underwriting information.

 

10. The policy documents clearly state the insurance is only for 60 months (PPI), 36 months (LIFECARE) and 24 months (MEDICARE).

 

11. Again it was Welcome not HFS

 

12. I have no idea how paragraph 7 is meant to apply here.

 

13. Welcome not HFS

 

14. Welcome is the party. How is this unclear?

 

15. Action is not based on these principals, nor are they relied on as a basis of claim. They are referenced for consideration only.

 

16.1, 16.2 Letters from Welcome upholding my complaints. Incidentally my original claim for PPI which was upheld clearly stated that the reason for mis sale was that Welcome stated the insurance was mandatory and would not be approved without the insurance. The lack of any breakdown detailing how Welcome arrived at the amount of compensation that was offered as a result of the mis sale.

 

16.3 Copies of letters asking for the info to which no reply was ever given. Receipts and signatures when these letters were signed for by Welcome.

 

16.4 Multiple letters back and forth starting in November 2010.

 

17. I assume they are referring to my claim on the basis of Sempra. The case summary I believe clarifies this.

 

20. As a LiP am I expected to have made a claim that precisely conforms with CPR? How does my claim not meet such a standard?

 

Also, lets assume that I am able to show that it is Welcome and not HFS to which points in my claim apply. How can I prove what was said or not said? As some of the conversation were done on the phone, can i not ask for copies or transcripts of the conversations? What if Welcome say no such records exist?

 

With regard to my claim of misrepresentations, am I mistaken in my belief that the burden is on Welcome to prove that there were none?

 

There are records in the public domain from General Meetings and Special Meetings of Cattle's where the CEO explains that due to bad practises and lack of a system of checks that Welcome were found to mis stated their accounts and reports. Can these be used or relied on in my claim?

[pokerking1]

morning mrz,is there a copy of your cca posted anywhere?

[MrZ]

morning mrz,is there a copy of your cca posted anywhere?

 

It is post elsewhere in the thread but here is another link:

 

WelcomeAgreementYellowFront.pdf

[steven4064]

Had a quick look at the defence. ISTM that you really need to bottom out the role of HFS in all of this. You may be able to add them to the claim as co-defendants under CPR 24. You will also need to change the name of WFS as defendant but that is easy.

[MrZ]

What leads you to think the MIF was sold to you to fund the payment of a commission? I believe WFS have litigated on MIF before in the High Court and won so there is already case law on MIF and I do not think commission was an issue. As it was the same counsel in the Hurstanger case you would have thought he would have raised the point.

 

Its a suspicion mostly. I have a copy of 2 Welcome contracts which would be identical expect for the fact that one replaces a broker fee with the MIF. I am referring to the form and contact of the form. They would be identical if not for this. Additionally I have asked for information from Welcome in order to eliminate that suspicion. They have declined to provide it.

 

I am aware that in the Griffiths Welcome argued the application of the MIF in relation to being a charge for credit. In that case, the argument from Welcome was that no insurance is/was ever purchase in relation to the MIF. Curiously the DOC above seems to be challenging me to prove the opposite. Its inconceivable to think that a finance company would be willing to "write off" a 15k loan simply by taking a fee...which is not upfront, but spread over the loan itself.

 

Aside from this, a MIF or MIG is well understood in the lending industry as an insurance. Many times borrowers are chased by insurance companies for the compensation paid after a shortfall. So even if the lender doesn't pursue the borrower still has a liability. Why is Welcome any different. At the least it could be argued that simply not obtaining insurance in respect to the policy, then the purpose of the fee is misrepresented.

 

They cant have both ways, either they purchased insurance, and should therefore have policy or other documents to show this, or no insurance was ever purchased as claimed in Griffiths, and is therefore misrepresented.

[MrZ]

Had a quick look at the defence. ISTM that you really need to bottom out the role of HFS in all of this. You may be able to add them to the claim as co-defendants under CPR 24. You will also need to change the name of WFS as defendant but that is easy.

 

The only reason HFS were mentioned was in order to be abale to show the relationship to Welcome in respect to commissions. In reality HFS had little if anything to do with any discussions with Welcome. In fact the link with HFS wasnt even apparent to me until after I received my SAR. To my surprise Welcome had a copy of my application for a loan. They denied me the loan but then passed that application on to Welcome. Welcome then phoned offering a loan. They were one of many companies thy frequently rang with offers of credit.

 

In that respect would it still be necessary to name HFS as co-defendants? HFS were bought by Capital one I believe. It seems to me that if I add them to the claim it would complicate things. I suppose if Welcome argue their word against mine, I would HFS to say one way or the other.

[steven4064]

HFS seem central to W's defence - you need to fully understand the relationship

[MrZ]

HFS seem central to W's defence - you need to fully understand the relationship

 

So how do I go about adding them? Would it be Capital One and not HFS? HFS doesnt exist anymore. Presumably I could at the same time change the name for WFSL? Am I understanding correctly they they are saying it should be Progressive Financial Services Limited and not Welcome Financial Services Limited? I'm sure the court will charge for this as well?

[steven4064]

Don't think about adding them until you fully understand their role

[MrZ]

Don't think about adding them until you fully understand their role

 

The only way I will have any more understanding than I do, is if Welcome provide the underwriting details. This I can ask for during the disclosure stage yes?

 

Other than this I was thinking to ask Welcome to provide the name of the person who packaged the loan. This person would then be a witness to the fact that it was Welcome who I was dealing with and not HFS. Every bit of contact and correspondence I had with this loan was with Welcome, failing the initial application to HFS who denied the loan. It was days later that I was contacted by Welcome and from that point, only Welcome.

[pdb1980]

The only way I will have any more understanding than I do, is if Welcome provide the underwriting details. This I can ask for during the disclosure stage yes?

 

Other than this I was thinking to ask Welcome to provide the name of the person who packaged the loan. This person would then be a witness to the fact that it was Welcome who I was dealing with and not HFS. Every bit of contact and correspondence I had with this loan was with Welcome, failing the initial application to HFS who denied the loan. It was days later that I was contacted by Welcome and from that point, only Welcome.

 

Do you have a written refusal of the loan from HFS? If you do this should help your case in proving its welcome and not HFS?

[MrZ]

Do you have a written refusal of the loan from HFS? If you do this should help your case in proving its welcome and not HFS?

 

Unfortunately no. All I have from HFS is the application form that I completed. If memory serves correctly, they telephoned to say it was declined. I don't recall ever getting anything in writing from them.

[steven4064]

Remember standard disclosure only applies in fast track/multi track.

 

WFS seem to be saying that HFS acted as agent for the loan so it is their problem not WFS's. If HFS refused the loan, they cannot be acting as agent and WFS is responsible.

 

You need the underwriting sheet, that is clear. WFS will not give it you without a fight. The problem is that, if this is a SCT case, there isn't a way of making them give it you (Standard disclosure, CPR sections 18 and 31.14 don't apply). IMHO, the only way to do this is to ask for fast track on the AQ on the grounds that this is not a simple case and requires further information. Put in a draft orders for direction for them to give you the underwritng sheet with the AQ (the order can be based on the one I used).

 

THis would be a high risk strategy as FT opens you (and them) to costs. However, it may be that they blink first. It is risky for them too.

 

I am going to ask for a second opinion on this.

[42man]

Just adding this as a possible reference

 

Wilson v Hurstanger

 

A broker negotiating a loan was paid a fee by his consumer clients and a commission from the lender. Although the clients were told about the commission, the broker had breached his fiduciary duty because he did not disclose the actual amount. The lender was held liable to the borrowers as accessory to the broker's breach

[steven4064]

There is also Kelvin Jack v Imageview but, in both cases, you would need the underwriting sheet to use them