Carey v HSBC & Associated Claims: Have We Seen the End of Consumer Cre - PDF document

y/Februar Carey v HSBC & Associated Claims: Have We Seen the End of Consumer Credit Campaigns?Express Services Europe Ltd [2009] CCLR 3this firm acted for American Express, went a long wayds suppressing the tide of debtors attempting tof the entire balance on their loans and creditcards on the basis of trivial technicalities. The case ofCarey v HSBC [2009] EWHC 3417 (QB)spurious consumer credit claims. Carey considered rcredit card agreements pursuant to section 78 of theConsumer Credit Act 1974 (Òthe ActÓ) and theconsequences of non-compliance with that provision.expectation of what a creditor must do to comply withsuch a request. Carey confirms that a crÕs dutyunder s78 is not as onerous as consumers have beenA creditor satisfies its duty under s78 by providing areconstituted version of the executed agreement, whicheement itself. In other words, the s78 copy does notneed to be a direct physical copy such as a photocopy.Crucially, a creditor is not under an obligation to providea signed copy of the agreement. Many debtors hadbeen arguing that a failure to provide a signed copyeement, but in light of Carey, cases brought on thisThe s78 copy must also contain the name and addresseement and if the agreement has been varied by thecreditor under a unilateral power of variation, thecreditor must still provide a ÔcopyÕ of the executedConsequences if a creditor is in breach of s78Whilst the default continues, the creditor is not entitledto enforce the agreement. In short, the crObtain a judgment which enforces the agrObtain a charging order; orObtain a bankruptcy order.However, the contractual liability of the debtor to payany sums due remains. Furthermore, during the s78default period interest will still accrue and the creditor isand/or report the debtor to a Credit Reference Agency. ÒIrredeemably unenforceable agreementsÓThere will, however, remain the class of agreementswhich the court will regard as ÒirrceableÓ. These are agreements, which do notcontain the so called ÒPrescribed TermsÓ. Theprescribed terms are set out in Regulation 6 andSchedule 6 of the Consumer Credit (Agreements)and frequency of repayments, the rate of interest andthe credit limit.It is vital that these Prescribed Terms are ÒcontainedÓ inthe executed agreement; it is not sufficient for the pieceof paper signed by the debtor merely to cross-refer tothe Prescribed Terms without a copy of those termsbeing supplied to the debtor at the point of signature.possible, all the terms of the agreement and thesignature box should be physically attached to eachother in order to avoid any potential argument on thisClaimants have also been arguing that a breach of s78gives rise to an unfair relationship within the meaning ofessentially rewrite the agrey decided that this was not the case; if a creditor isin breach of s78, this does not, in and of itself, give riseto an unfair relationship within the meaning of sectionCarey is welcome clarification in the area of consumercredit law, which grought on the basis of s78. Indeed, this firmlegal action based on arguments such as those raised inCarey have already notified the creditor of their intention y/Februar BBA Conferences/SeminarsSimon Orton, Partner, FreshfieldsRachael Mulheron, Professor,Department of Law, Queen Maryric Leenders, Executive Director ofStress Testing Seminar24 March 2010robust stress testing programme. The BBA'sStress Testing Seminar will outline the FSA'slatest requirements and examine reversestress testing, liquidity stress testing, and thepotential impact on capital buffers andPiers Haben, Manager, Pillar II and StressTesting, Financial Services Authority Jason O'Mara, Head of European CapitalStress Testing, HSBC Bill Rickard, Head of Policy and Strategy,RBS Group Treasury, Royal Bank ofChris Smith, Stress Testing LiquidityManager, Royal Bank of Scotland ving Henry, Director, British Bankers'ire Transfers Briefing26 March 2010This morning briefing will explore howeffective the new SWIFT cover payment forcredit transfers has been in increasingmessage information and explore what theFeaturing contributions from:Paul Proctor, Group Regulatory Affairs,AML, BarclaysNicolas Stuckens, Market Manager, AMLCatriona Shaw, Policy Director, BritishConsumer Credit Directive Seminar29 March 2010Consumer Credit Directive (CCD) is fastwill update members on recent changes tothe CCD regulations and their impact on theirshortly.30 March 2010how the market is evolving in response tobe announced shortly. For more details on any of ourconferences please visit www.bba.org.uk/conferconferences@bba.org.ukConference Contacts:Joanna King, Tel: 020 7216 8832 Sue Dow, Tel: 020 7216 8817 Email: sue.dow@bba.orviewed as fair and sensible. As is clear from the judgments in Rankine andCarey, it would be unjust if a creditor was not entitled to recover anoutstanding balance on the basis of a mere technicality. The Carey judgmentspurious claims. In fact, the Ministry of Justice has warned that this casebusinesses are misrepresenting the outcome of this case (and others) ormisleading consumers will be treated very seriously. Taking the decisions in Rankine and Carey in conjunction with the SupremeCourt decision in the so called "unfair bank charges" litigation, one would Continued from page 4 Professional Associate member.e are also pleased to announcethe BBA Annual InternationalBanking Conference on 13th Julyas Silver Sponsor.http://www.bba.org.uk/siemens