The Wellman Partnership LLp
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| 08-11-2007 9:03 AM |
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If anyone has recently received contact from debt collection agencies about dormant debts from the dim and distant past then check out the link below for the law regarding debts that are more than six years old.
http://www.hmrc.gov.uk/manuals/IHTmanual/IHTM28384.htm
from this it can be derived that if you've received a letter from a company regarding old debts IGNORE IT, DO NOT CONTACT THEM and especially DO NOT ACKNOWLEDGE THE DEBT as this will start the time limits all over again
This is unless of course you are happy to repay the debt then disregard what has been written here.
Also please be aware of people or organisations that could take oportunities like this to run scams playing on peoples ignorance of the law and memory to relieve you of your hard earned.
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The Wellman Partnership LLp
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| 08-11-2007 9:29 AM |
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Just to simplify the link above,
The way the statute of limitations comes into play at different times regarding different debts, for any land related debts such as mortgage shortfalls the creditor has 12 years from when default has occured to take the matter formally through the courts.
For unsecured credit cards and loans the period is 6 years from default to take the borrower to court. If the relevant period is reached without court action being taken then they lose the right to do so forever.
If a summons is issued prior to the six year term it’s a standard defence as it’s already a statute barred debt no court action or order can be taken or made.
They can chase a debtor for the money and they would still owe it. The debt would still exist, they would still be liable, they can still be asked to repay it and it can still be re-registered on their credit file time and time again if it remains unpaid, the only change is the person cannot be forced to repay it any longer.
Ultimately if someone wishes to borrow again in the future then an old debt registered on a credit file could present a challenge. If this is so my suggestion would then be to make an offer of a full and final settlement. This is of course only if it does adversely affect your credit rating.
Good fortune everybody
Gary Wellman
The Wellman Partnership LLp
www.wellmanpartnership.co.uk
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The Wellman Partnership LLp
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| 08-11-2007 9:45 AM |
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My apologies but here's a bit more!
If the creditor has been to court and there is a County Court Judgment outstanding, then the debtor cannot use the statute of limitations to dispute they owe the debt. It does not matter how many years ago the creditor went to court, the CCJ will still exist. However, the creditor may not be able to enforce the Judgment without the court's permission if the Judgment is over six years old.
If the debtor thinks the creditor has been to court and got a County Court Judgment against them after the debt is out of the six year limitation period, then they can ask the court to "set aside" or remove the County Court Judgment so you can put in a Limitation Act defence.
For people who aren't confident doing this on their own the best option would be to seek professional assistance.
Gary Wellman
www.wellmanpartnership.co.uk
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debsbaker
Posts:111
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| 11-11-2007 4:20 AM |
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Excellent post Gary.
Thank you for your time on this, it is good to know we have such good professionals established on this site to inform us all.
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Kind Regards
Debbie Baker
Tip Consultancy - Financial Recovery Specialists
07790 533884 |
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Johnny Debt
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tinab
Posts:3
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| 11-01-2008 6:53 AM |
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thank Gary, I have just been hit with a debt from 2000 which i answered that it wasn't mine, I did think it was out of time, so it looks like it is so i will now ignore it. Its only £103! wish it was mine and i could swap it for some others I have that I can't get out of!
if i lent someone money in 1997 and they admitted in writing through a solicitor that they owed it, then the solicitor stopped civil trading and dropped the case. Since then any contact has been verbal and he always says he would pay it when he has the money. 2005 was the last conversation. I then found out he had moved house and could have paid me when he sold the house (that the money was lent for). I have now found out where he lives but all paperwork is out of date, does a verbal contract count? |
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The Wellman Partnership LLP
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| 14-01-2008 8:42 AM |
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Hi Tina,
In a word YES a verbal contract is legally binding as long as you and the borrower agreed the terms of the contract.
From what you've written the original written contract is outside of the limitation act which means you haven't anyy recourse for legal action.
If when you spoke with him in 2005, he acknowledged the debt then the limitation act does not apply and you have grounds for legal action. However you need to prove that you have spoken with him and that an acknowledgement was agreed.
If you agreed a new verbal contract with him on the telephone then it stands as legally binding as long as you agreed on all points of the contract i.e. money owed and when it was to be paid by etc.. If it was subject to contract then it has no legal standing.
The best thing to do would be to speak with a solictor and see if you have a case.
Hope this helps
Gary
The Wellman Partnership LLP
www.wellmanpartnership.co.uk
01202 462781 |
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Gary Wellman |
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tinab
Posts:3
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| 17-01-2008 6:07 AM |
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| Soz Gary, just found my way back to this! The problem i will have is proving it. As it was a conversation between us with no witnesses. i did tell people, but as they wern't there its just my word i would think. |
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Eckersleyjj
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| 27-01-2009 2:12 PM |
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Gary,
I want to ask a question in the same area as Tina.
I am owed a substantial debt going back to 1993. The debt was agreed by the debtor at that time in writing (solicitors were involved) and he has never denied owing the debt. Between then and now for a number of years the debtor paid me a nominal sum monthly by standing order which in effect paid the interest owing and accumulating. This stopped approximately 3 years ago. The debtor said that the standing order would temporarily cease whilst banking accounts were changed. No recommencemnet of any payment has happened. I have been in constant touch with the debtor over all this time and now at last an opportunity has arisen for him to pay back the debt, however, he is apparently backsliding on this.
If this turns out to be the case, what I want to know is am I able to sue him still after all this time due to the fact that I have only just now been informed that he will not pay the debt. Will the limitation period commence after the stopping of the standing order payment (3 years ago)?
A separate question but related - if he has transferred all his assets into his wife's name meanwhile where do I stand?
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Dementoid
Posts:393
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| 27-01-2009 2:48 PM |
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Hello Julian
How much are you owed?
Even if he has transferred all his assets into his wife's name, there are certain routes for you to get access to them. |
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Eckersleyjj
Posts:4
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| 27-01-2009 5:51 PM |
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I was originally owed £17,000 back in 1993. I have increased this to £24,000 by interest calculation.
Please advise if you believe that there is a possibility of commencing proceedings at this stage (ie, outside the Statute of Limitations Act) as I am having a meeting tomorrow with the debtor and would like to know my position!
Thanks.
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Eckersleyjj
Posts:4
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| 28-01-2009 11:39 AM |
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Hello there!
Any chance of a reply as I am having the meeting today and would like to know the position.
Thank You. |
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Dementoid
Posts:393
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| 28-01-2009 5:11 PM |
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Sorry I did not see your post till now!!
How did the meeting go? |
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scorrrpion
Posts:2
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| 21-06-2010 6:41 PM |
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| I had a credit card and defaulted on it about 9 yrs ago , I did have contact with the company sending letters out but moved home 7 yrs ago , today 21/06/2010 a new company contacted me by phone and said they had been sold the debt , I told them to phone back later an switched my phone off. My question is do I have to deal with this company as the original debt was over 7 yrs ago ???? I also have a new credit card with the same credit card company now ( paid usually in full every mth ) in my new address with same details as the defaulted card debt. |
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Johnny Debt
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tinkerbell
Posts:17
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| 23-06-2010 9:18 AM |
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Found this:
WITHOUT PREJUDICE
Dear Sir/Madam
Re: Account No/Reference No:
No debt is acknowledged to you. You have contacted me regarding the account with the above reference number, which you claim is owed by myself.
I would point out that under the Limitation Act 1980 Section 5 “an action founded on simple contract shall not be brought after the expiration of six years from the date on which the cause of action accrued.”.
The last payment or acknowledgement of this debt was made over six years ago and no further acknowledgement or payment has been made since that time. Unless you can provide evidence of payment or written acknowledgment from me in the relevant period under Section 5 of the Limitation Act, I suggest that you are no longer able to take any court action against me to recover the alleged amount claimed. Any such action WILL be defended and challenged on the above grounds.
I await your written confirmation that no further contact will be made concerning the above account and confirmation that this matter is now closed. If you do not supply such confirmation, I will be making a complaint to the Financial Services Ombudsman. Also, continuing to press for payment after a debtor has stated that they will not be paying a debt because it is statute barred could amount to harassment contrary to section 40 (1) of the Administration of Justice Act 1970 .
I look forward to your reply.
Yours faithfully
(Your signature) |
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scorrrpion
Posts:2
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| 23-06-2010 10:29 AM |
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The original debt was with Capital1. Now a company called lowell financial say they bought the debt. |
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Bently
Posts:47
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| 23-06-2010 11:55 AM |
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In some cases companies take a "scatter-gun approach". What they do is write/call for example, all the John Smith's in a particular area to see if anyone responds to their letters/calls.
So in this particular case it might be a good idea NOT to respond at all at this stage. |
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tinkerbell
Posts:17
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| 23-06-2010 12:00 PM |
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| If ignoring them does not work, you could write to them requesting proof of debt, using the proof of debt letter with a one pound postal order. |
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hatnowski
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| 29-05-2012 10:35 AM |
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hi everyone, i know this is an old thread but im hoping someone can help/advise me on my situation,
I am recieveing letters, text messages phone calls etc regarding a bank account i had 8-9 years ago. It was a card cash account with the nationwide bank. There was no overdraft facility and no direct debit on this account however they are now claiming i owe them in excess of £300 i dont ever remember owing them any money and i cant think for what reason i would owe them given the account that it was. I have moved house 4 times since this account was opened and have not acknowledged this debt in the 8-9 yr time frame, they are now threatening me with legal action unless i pay in full or make a suitable arrangement. does this fall under the statute of limitations if so what necessary steps, if any, do i take now??
Thanks in advance for any help on this matter .Hayley |
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