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Debt Solutions Southwest Ltd is a debt management business based in the South West of England, providing a full debt management and credit advisory service to individuals and businesses.

CASE STUDY: Lloyds Bank TSB v Jeremy


This case involved one of our clients and Lloyds Bank.


The background 


Jeremy (not his real name) received a summons from Lloyds Bank TSB (the Bank) and approached us to handle this case (and his other credit cards). Having received his agreement documents from the Bank we put on a defence which, in summary, was as follows:


a). The documents provided by the Bank were not ‘an executed agreement’ under the Consumer Credit Act 1974 (The Act) and the agreement was, therefore, unenforceable against Jeremy.

 

b). Alternatively, if the court decided that what was provided was an agreement, it was ‘improperly executed’ and, therefore, wholly unenforceable against Jeremy. 


To our surprise, the Bank said that our defence had “no reasonable chance of success” and, because of this, they would apply to have the defence struck out and judgement awarded in their favour.


The hearing at the Portsmouth County Court 


On the day, the Bank was represented by its barrister and Jeremy was represented by our solicitor. The Bank was still insisting that it would apply to have our defence struck out and that a hearing on the merits of our case was not necessary.


In the event, the Judge decided that:


1. What the Bank had provided Jeremy was not an executed agreement and,

2. This being the case, the Bank was unable to take the case any further.


What this means legally


1. The Bank had failed to overcome the first leg of our defence (namely, that what had been provided was not an agreement) and pursuant to section 78(6) of The Act was barred from enforcing the agreement while this default continued. The Judge refused the Bank’s request to “look for more documents” as it had already had several months to do this.


2. The stronger part of our defence, in our opinion, was that the documents provided by the Bank were ‘improperly executed’. Without being too technical, this means that the documents were drawn up (and executed) in a way that did not meet the strict requirements of The Act. Because the Bank had fallen at the first hurdle, the court did not have to consider this second leg of our defence.

 

What this means to our clients


Whether a particular agreement is enforceable depends on the documentary and legal details of each case and, of course, each case is different. Where we believe that an agreement is enforceable will we advise our clients accordingly. We will do the same where we believe an agreement is unenforceable. In all cases, we will provide the client with the legal reasons for our beliefs, if they request them.


Following our advice, it is entirely up to our clients to decide what steps they wish too take, which could include negotiation, legal action, or letting the lenders take action if they wish. Our role is to support you in whatever action you wish to take.