Interest added to CCJ for rent arrears - help

[mike1234567]

Hi, I'm hoping to get some advice on my situation please. I have a CCJ for rent arrears,

I failed to make the payments and now have a suspended attachment of earnings order.

 

My question now is surrounding interest

as I received a letter from the claimant's solicitor advising of the repayments to be made and stating the interest owed and accruing.

I've had a look around and it seems to be a cloudy area, so I am hoping for some clarity. I'll try to give as much information as possible...

 

 

1. Debt is for rent arrears. In the tenancy agreement, the clause pertaining to interest reads "If you owe rent or any other money legally payable to us under the agreement, you will have to pay interest on this amount from the date that it should have been paid. The interest rate is 3% above the base rate used by the Royal Bank of Scotland. This rate may apply before, as well as after, a court judgement has been made against you, depending on the terms of the court judgement'.
   
2. The claimant originally tried to claim 8% interest when getting the CCJ. I defended this.
   
3. The judgement is a judgement by determination. It states, "The claimant has objected to the rate of payment you offered. The court has therefore decided the rate at which you should pay. You must pay the claimant £4,569.32 for debt (and interest to date of judgement) and £340.00 for costs. You must pay the claimant the total of £4,909.32 by instalments of £100.00 per month, the first payment to reach the claimant by 15 June 2015 and on or before this date each month until the debt has been paid.
   
4. On the bottom left of the judgement, in the box 'Note to claimant and defendant' it says 'If judgement is for £5,000 or more, or is in respect of a debt which attracts contractual or statutory interest for late payment, the claimant may be entitled to further interest'.
   
5. I did not make the payments. The claimant made an application for an attachment of earnings order (using the incorrect address, I believe intentionally so I wouldn't get the information) and was awarded a suspended attachment of earnings order for £170 per month.
   
6. I disagreed with this amount, and received a further suspended attachment of earnings order for 100 per month. The amount is £5,064.32 - I think the extra £155 is the cost of the attachment of earnings order.
   
7. The suspended attachment of earnings order says in the first paragraph '...deduct £100.00 per month from the judgement debtor's earnings and send it to the court until £5,064.32, the amount payable under the judgement or order, together with any interest (where judgement is for more than £5000 or includes a sum in respect or contractual or late payment, the judgement creditor may be entitled to further interest) has been paid...". In the next paragraph it explains that the order is suspended.
   
8. The letter I received from the claimant's solicitor states that 'The value of the arrears was £4,569.32 plus interest at 3.5% which was £107.42 by 20/02/2015 and accrusing at a daily rate of £0.44. 331 days have since passed, so the interest is now at £253.06. The costs of £440 are to be added, being the court and legal fees as ordered'. It then gives a calculation then states 'Interest continues to accrue at a daily rate on any outstanding amount. Towards the end of the payment term a review of the interest can be carried out'. I'm not sure of the relevence of the date of 20/02/2015 as the judgement was made in May 2015.
   

 

So, what do you think? Is this correct?

[citizenB]

I will try and find someone who can advise you on this.

[mike1234567]

Thanks citizen:-)

[AndyOrch]

Mike could you possibly upload a copy of their particulars and a copy of the judgment (less any identifiable data)

 

Regards

 

Andy

[mike1234567]

Hi, please see the attached.

I've included 2 pages from the particulars,

the CCJ order and the suspended attachment of earnings order.

Some other points I haven't mentioned yet, just to note really...

 

9. Before the CCJ was issued I wrote to the claimant and their representative asking them to accept a Tomlin Order. This was ignored.

 

10. The CCJ judgement was incorrectly sent out, twice.

Firstly, it was a judgement by acceptance for £100 per month

- I advised the court this wasn't right as I had asked to pay £50 per month.

Then they sent an order saying I had to pay the full amount!!

I advised again this was incorrect and then they sent the correct judgement by determination for £100 per month.

 

3. The claimants solicitor sent me a letter following the second judgement saying I had to pay the full amount.

They did not send anything following the first order or the third (correct) order.

 

11. Following the confusion over the orders, I missed the first payment date.

I emailed the claimant and their solicitor twice apologising about this

and asking them to confirm that if I caught up with the payments they would take no further action.

These messages were ignored.

 

12. The claimant made the application for the attachment of earnings using the incorrect address.

They did this in July and I didn't find out anything about it until November

when the claimants solicitor phoned me to confirm my details so bailiffs could come and serve me the papers (!!!).

 

 

I think this was intentional as I had given them my new address months earlier

and they had previously used the correct new address.

Not sure if this was done to get me in trouble or to help get more interest added.

 

Any help on this would be very much appreciated.

docs 1.pdf

[AndyOrch]

You pay what the judgment states...including costs and interest up until judgment...there is no accruing interest as the debt is less than 5K...the claimant as only requested sec69 interest up until judgment...not statuary or contractual interest within its particulars.......end of.

 

Regards

 

Andy

[mike1234567]

Hi Andy, thanks that's really helpful. Hopefully I can provide a little further information and you can clarify before I go back to the claimants solicitors. The total amount of rent arrears (plus charges for bounced cheques) was £4569.32. They attempted as per those particulars to claim 8% interest. I defended saying it should be 3.5% as per the contract (term from the contract stated in 1. above). Looking at the CCJ order no interest has been added (although the box in the bottom left states interest may be added). I hope it's ok to ask a few more questions...

 

Q1. Does the fact I defended saying it should be contractual interest not change anything?

Q2. Does the fact the value is now over £5,000 after the attachment of earnings costs are added change anything?

Q3. In the particulars, part ii) does that not mean they are looking for post-judgement interest?

Q4. Any thoughts on what I should say writing back to them would be good.

 

Sorry for so many questions, I have no idea what I'm doing so any help would be very much appreciated.

 

 

[AndyOrch]

Hi Andy, thanks that's really helpful. Hopefully I can provide a little further information and you can clarify before I go back to the claimants solicitors. The total amount of rent arrears (plus charges for bounced cheques) was £4569.32. They attempted as per those particulars to claim 8% interest. I defended saying it should be 3.5% as per the contract (term from the contract stated in 1. above). Looking at the CCJ order no interest has been added (although the box in the bottom left states interest may be added). I hope it's ok to ask a few more questions...

 

8% is standard section 69 interest...interest on money outstanding and is at the discretion of the court to award it...it has nothing to do with your lease (contract)

 

Read the following link

 

http://www.legislation.gov.uk/ukpga/1984/28/section/69

 

Q1. Does the fact I defended saying it should be contractual interest not change anything? See above..I wouldn't think contractual interest is applicable to a lease

Q2. Does the fact the value is now over £5,000 after the attachment of earnings costs are added change anything? No it runs with the initial Judgment amount...executing the CCJ is seperate to the total

Q3. In the particulars, part ii) does that not mean they are looking for post-judgement interest? No their point 6 refers to section 69 interest see above

Q4. Any thoughts on what I should say writing back to them would be good.Just try to agree an affordable monthly figure and get a payment arrangement in place...you state the AoE is suspended for now?

 

Sorry for so many questions, I have no idea what I'm doing so any help would be very much appreciated.

 

 

 

Regards

 

Andy

[mike1234567]

Hi Andy, thanks again for getting back to me. Yes it's a suspended AOE order and I need to pay £100 per month by a certain date and if I don't they can go back to the court and have it applied through my employer.

 

Can they re-apply to the court to attempt to have interest added? Just a bit worried that if I go back explaining there is no interest it will open a new can of worms...

 

Thanks again

[AndyOrch]

No they cant change the judgment...they have had their interest...its already included in the judgment total

[mike1234567]

ok thanks (just to clarify no interest was included in the judgement total that was just the rent arrears plus costs hopefully that doesn't make a difference)

[AndyOrch]

The judgment you have uploaded states you must pay the claimant £xx for the debt plus costs = £ xx plus interest to the date of judgment ( which you need to add £245.53 calculated to the 22nd Feb 2015)

 

So now work out the difference from 22/2/15 to the 13/5/15...which should be £1 a day

 

You pay until the total paid is £5064.32

[AndyOrch]

Check that £1 per day interest on a balance of £4909...seems a lot £1 day.

 

Calculating interest under the County Court Act

 

In many cases you can claim interest on the money you are owed.

To calculate this, use the steps below;

 

1. Work out the yearly interest: take the amount you’re claiming and multiply it by 0.08

(i.e. 8% - this will equal 8% of the amount claimed).

2. Work out the daily interest: divide the yearly interest from step 1 by 365 (the number

of days in a year).

3. Work out the total amount of interest: multiply the daily interest from step 2 by the

number of days the debt has been overdue.

 

For example, if you were owed £1,000:

 

• the annual interest would be £80 (1000 x 0.08 = 80)

• divide £80 by 365 to get the daily interest: about 22p a day (80 / 365 = 0.22)

• after 25 days this would be £5.50 (25 x 0.22 = 5.50)

 

If you are claiming interest under the County Court Act you will need to complete some extra

fields for step 5, including the daily rate of interest. You need to add this amount of interest

to the total claim amount and enter it in the box for ‘amount claimed’ as shown at the

bottom of the example. This ensures that any interest due prior to issuing the claim is

included in the total amount claimed. This cannot be added to the claim at a later date

without making an application for permission from a District Judge which incurs a fee.

 

Please note that you can use the same daily rate to calculate interest from the date the claim

was issued to the date of judgment if your claim reaches that stage.

[mike1234567]

I'm confused.

 

They claimed the 8% in the particulars. I defended. Here is the section of the defense:

 

-----

3. As to paragraph 6, the Defendant pleads as follows:

3.1 It is denied that the Claimant is entitled to recover interest at the rate of 8% pursuant to s69 County Courts Act 1984. Pursuant to s69(4) County Courts Act 1984, interest in respect of a debt shall not be awarded under the Act in respect of a period for which interest on the debt already runs;

3.2 Clause 9 of the tenancy agreement provides that interest on unpaid sums due under the tenancy agreement shall be at the rate of 3% above base rate of Royal Bank of Scotland. Accordingly, the Defendant avers that the Claimant should not be entitled to interest at 8% as pleaded.

-----

 

The judgement then gives no detail about the interest awarded (8% or 3.5% or nothing?). I read the '£4,569.32 for debt (and interest to date of judgement)' to mean that £4,569.32 was the total. Is that wrong!

 

Sorry, really confused!!!

[AndyOrch]

Well the court has not stipulated within the judgment what interest rate nor has it awarded it as the total due...simply tells you to add it.

 

If you refer to the second judgment notice(AoE) you will note that they now state the total due is £5064.32...so thats the initial judgment plus the fee of the AoE (155.00) so still no interest added.

 

Therefore I take that as no interest has been awarded or allowed.

[mike1234567]

Right, that's great, thanks again Andy.

 

I just want to check one more thing before going back to them - the fact that the contract states they can recover after the judgement ('This rate may apply before, as well as after, a court judgement has been made against you, depending on the terms of the court judgement') and the judgement mentions contractual interest, does that mean anything? It seems like that is what they are trying to apply in the letter I've received.

 

Thanks again

[AndyOrch]

Can you post a copy of this letter and let me see the wording (verbatim) ...(please remove any identifiable data first)

[mike1234567]

Please see letter attached

CAG_letter1.pdf

[AndyOrch]

Okay many thanks ...Interest would be allowed up until judgment date...so £5064.32 is the total debt outstanding...they may have requested it within their particulars...but they also requested " as the court seems fit "

 

The Court adjudged £5064.32 is fit...that is all you are indebted for.

[mike1234567]

Great thanks so much for your help. Will respond to their letter then see what happens!!

[AndyOrch]

No problem mike...thread moved to the appropriate forum.

 

Regards

 

Andy

[mike1234567]

Apologies Andy I've got another question. Between the CCJ order and the attachment of earnings order the total went from £4909.32 to £5064.32, and increase of £155. I assumed this was the attachment of earnings fee, but I've just read form EX50 which states the free for an attachment of earnings is £100. Where would the £155 come from? Bailiffs did come out to attempt to serve me the papers and get me to fill them in but that was only because the claimant used the incorrect address on the application. Confused again!

[Guest]

155 sounds like a general application fee. were there any other applications prior?

[AndyOrch]

Bailiffs fee

[mike1234567]

Thanks both. Is the bailiffs fee £55? I couldn't find it on the EX50 document. Should I be liable for that? The only reason the bailiff came out was due to me missing the deadline, which was due to the claimant using the incorrect address (I have evidence of me providing them with the new address months earlier and included this with my form).

 

I don't know of any other applications.

 

I'm was just concerned as the letter I uploaded from the claimants solicitors mentioned £100 costs being added, not £155. I was worried the £55 was some sort of interest.

 

If I phone the court would they confirm what the charges were for?

 

Thanks again everyone