Statute Barred

[RevFunk]

IHTM28384 - Law relating to debts: statute-barred debts

"If a lender allows time to pass without receiving any payment an action for recovery may become barred."

Under the Limitations Act 1980 the time limits are

in simple contracts, 6 years
in contracts under seal, 12 years.
If the debtor acknowledges the debt in writing or makes a part payment within the original limitation period, then the time limits start to run again from the date of acknowledgement or the date of payment.



Oh dear oh dear oh dear looks like I was right.

Thank god for British Law.

Rule Britannia!!!!

[paulos66]

Rev, are you currently scared and lookinfg over your shoulder - I suspect not - Bounty you might not like the morals, reasoning or legalities but you're wrong

[MrBounty]

Paulo - until someone from a CC company or a debt collector comes on and tells me that after 6 years a debt (even to the sum of �40K) is just wiped out, you cannot say that i am wrong.

Rev listed the HMRC website, but even with what is written there, there are ALWAYS loopholes for the companies to get their money back.

As i said, the website tells us "the recovery may become barred".
Right there, in the first line, is the loophole - "may" become barred.
It does not say "the recovery will become barred".
They can and will get around it.

Rev had purposely dodged repaying �40K - no company will write that off without genuine reason.

All this, of course, is subject to Rev telling the truth about the debt....and i doubt telling the truth is something he does very often.

[paulos66]

Bounty, my missus works in a finance co, is that good enough for you!

[Barmaid]

I do not know the ins and outs of what has happened so I apologise if I am barking up the wrong tree. s5 Limitation Act 1980 provides that "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."

That means after the expiration of 6 years proceedings cannot be issued for recovery of the debt. Thus the company can chase all they like but the only way of getting the money back is court action. Unless they issue proceedings within that period (although they do not need to serve for another 4 months if the Defendant is within the jurisdiction) the debt is barred . Even one day outside limitation and they are barred. There are cases where there is discretion to lift the time limits (particularly in cases of personal injury, but this is discretionary and there needs to be exceptional circumstances).

[RevFunk]

Thank you barmaid

Mines a dandelion and burdock

[MrBounty]

Paulo - no

Barmaid - If what you are saying is correct, then that would mean the companies would take Rev to court for failing to pay back the �40K of debt, which would also bring up the fact that he has purposely evaded any correspondance with them (also getting his own mother to lie for him) and not told the companies where he is.

How can the companies involved collect monies owed when they do not know where he is residing?
His dodging contact with the CC companies is effectively saying that he has borrowed the money, is refusing to pay it back and is doing his best to evade them.
Is this not what theives do?
Take something and hide, so that they are not found out?
Doesn't the law look down on this sort of thing?
Dont people get sent to jail for this?
I think so.
Im very sure that this will incur a loophole somewhere which would grant what you have said null and void and would probably sent Rev (and possibly his mother, for her part in it) to jail.

[paulos66]

You're funny

[Barmaid]

As I said, I haven't been following the full story, so I don't know the ins and outs. But broadly speaking if Smith owes Jones a debt and Jones writes to Smith saying "pay me the money", but Smith ignores the letters (ie does not acknowledge the debt nor make payment), the only option Jones has is to pursue the money through the Courts. This is where the limitation defence kicks in. If they do not start proceedings within the period, they are barred from commencing proceedings. However, under s32 of the Act, if there has been concealment by the defendant of any fact relevant to the claimant's course of action, the LA defence does not start to run until the date of that knowledge or the date they could have known. This latter section actually requires a fairly robust standard of proof.

[Barmaid]

Oh and the company can start proceedings and serve on the "last known address" of the defendant and even if he never becomes aware of those proceedings they are perfectly valid. That is one way of mitigating the problem of people who move and do not leave a forwarding address. EVEN if it is KNOWN that the person no longer resides there, service is still legal as long as reasonable enquiries as to forwarding addresses have been made.

[MrBounty]

So, Barmaid, here are some facts for you:

Rev has �40K of debts over 8 credit cards.

He has moved home and ignores any mail from the credit card companies.

His mother, if she receives any mail from the CC companies, sends it back, saying "not at this address" or "moved abroad", when, in actual fact, she knows fine where he is.

He continues to believe that the debt will be wiped out.

In layman's terms, what can happen to him?

[Barmaid]

that's a very difficult question to answer without knowing exactly the facts of each debt, the period, the type of company etc. But in general terms the CC company will generally let it ride until 6 months before limitation expires (they do have a diary system that will flag this up). At this point humans intervene and it either gets forgotten about thus the debt gets statute barred (subject to my comments in an earlier post) or it gets acted upon and proceedings will be served at the last known address. Then either Judgement in Default will be entered (if there is no defence filed, but there may be a defence). If there is no JiD and then the lenders are successful if proving their claim they then have a further 12 years to enforce judgement. Alternatively, they could issue a statutory demand if the money is over the bankruptcy limit (I think �850 per debt) and then proceed for bankruptcy. Unlikely to result in criminal charges. Only charge I consider possible is obtaining a pecuniary advantage by deception, but whilst not telling your credit card company your new address may be a breach of contract, it may not necessarily amount to deception. Questions also about the coincidence of actus reus and mens rea, but I am no criminal specialist.

His mother is not lying when she says "not at this address" if he is not. Although there may be a fib if she says he is abroad when he isn't. She has no duty to inform the CC company of his whereabouts.

So in layman's terms:-

1) he gets away scot free when limitation expires
2) the company get judgement against him within limitation period or apply to the court under s32 to extend limitation period if they can prove concealment
3) a creditor petitions for bankruptcy.

[cheries]

I like you Barmaid, you're very clever indeed.