Using the Consumer Credit Act
The Consumer Credit Act also stipulates that creditors have a duty to supply information to debtors upon request. Failure to comply may render the account unenforceable.
Unenforceability may be a viable option if you have old, unsecured debts that fall within the CCA, mostly where the account was opened before April 2007. A change in the Consumer Credit Act with effect from April 2007 means that accounts opened after that time can still be enforced even if they do not comply with the requirements.
The Consumer Credit Act does not state what constitutes enforcement, however, it is commonly accepted that obtaining judgment against the debtor (a CCJ) constitutes enforcement.
On McGuffick v RBS, it was established that the following actions do not amount to enforcement:
The above means you cannot argue against credit defaults recorded for unenforceable debts.
There was a time when debtors were able to challenge their credit agreements in court and have them declared unenforceable. This was usually done with the assistance of a claims management company (CMC) or a solicitor or law firm. After the Carey vs HSBC case, this course of action has been largely abandoned, and these days, unenforceability is used as a defence as opposed to debtors becoming claimants against creditors. It should be noted that, in the above case, Carey and the others involved in the case were CLAIMANTS, not defendants.
A number of myths have been associated with unenforceability:
To assess whether your accounts are enforceable, you need to start by sending out a CCA request for each account. This request should be sent to whoever is chasing you for the debt, whether it’s the original creditor or DCA. A DCA or debt purchaser has a duty to obtain this information from the original lender (usually a bank, finance or credit card company).
They should respond within 12 working days (+ 2 allowed for service). Most DCAs are unable to comply within this time frame because they need to go back to the original lender to request the documents. This can work to your advantage, as the account becomes unenforceable whilst they are in default of your request.