The Jackson Reforms… a month on………….

Well its nearly a month since the wonderful Government brought in the amendments to the CPR which hit among other things the recoverability of successfees under no win no fee agreements.

Obviously, the initial thoughts were that consumers would face difficulties in obtaining access to justice and while this will undoubtedly be true for Claimants wishing to pursue a personal injury claim as they would now have to pay the successfee from their damages, for our clients it is not as bad as we first thought.

It is true that we are now more strict with the criteria of cases we take on, but the reality of it is that we are still taking cases on no win no fee, and while the client will now have to pay any success fee, we are not obliged to charge the Client a successfee at all if we dont want to and we are taking a flexible approach with clients and are happy to allow payment over a period of months where the case warrants it.

I must confess i did  think that the firm would cease taking on no win no fee cases, however, clearly i was wrong and the Jackson reforms, while more challenging are not a reason to stop taking cases on no win no fee.

Also, statutory demands are unaffected by these reforms, so we can still recover the successfee from the opponent, so cases involving bankruptcy are not affected at all.

I must say that Kerry Underwood of Underwoods solicitors was right when he said that the reforms are not as bad as some people thought they would be.

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Our order “appealled” to the Judge

An interesting case came up recently which went to reinforce my view that if you are not sure of the arguable points in your case, or how to present them correctly in a Defence, then you should seek legal advice.

The case in question, as so many others do, involved a matter where a clients account had been purchased by a third-party who were seeking to recover the balance outstanding on a credit card account.

The matter ended with the Client being sued, there appeared to be a number of grounds of challenge in this matter, however due to the clients lack of understanding many of the key points were missed out of the Defence, instead there were a number of irrelevant quotes from cases which didn’t assist.

The case did not really get off the ground, as the Claimant applied for summary judgment and unfortunately for the client, they succeeded and judgment was granted. Thus leaving the client with not only the full balance now being payable but also costs, and a CCJ on the credit record.

At this point the client contacted us and we took the case on a CFA basis. We also found a barrister on a CFA also. We considered the judgment and identified a number of weaknesses within the judgment. We prepared the grounds of appeal and filed the appellants notice (Form N161) . We identified a number of points which the Client had not considered or had not argued correctly.

We drafted up a consent order which allowed the appeal by the consent of the parties, of course the appeal court needs to be satisfied that there is a good reason for allowing the appeal without hearing the parties as the Courts do not like to interfere with a judgment unless there are good grounds to do so but as long as there are grounds and neither of the parties isnt a child or under the Court of Protection then it should be straight forward.

There was a fair bit of tooing and froing between the parties, and eventually the parties agreed to the appeal being allowed by consent relying on CPR 52 PD52A Paragraph 6.4. All of the costs were paid by the opponent.

The Judgment should never have been granted, but the client simply was unable to present a convincing argument to the Judge and as a result the client lost. The Client was on a tilted playing field from the start as the barrister the Claimant sent was well versed in Consumer Credit Law but the Client wasnt, it was a case of the Claimant barrister had the Judge eating out of his hand while the Client was simply given short shrift.

The case was put back on an even keel and an amended Defence was prepared raising all of the keys issues which gave the client a chance at trial.

The key point here however is if you do feel out of your depth, you are merely going to cause yourself more problems if you go it alone. It costs nothing to get some advice and see if there are any firms willing to assist you on no win no fee.

At the end of the day, success can never be guaranteed, but with the right help, you can give yourself the best fighting chance available.

MBNA told show must go on……..but gave up anyway

A follow up to my post last month on here.

MBNA were defeated on an application for summary judgment by my client who was represented by arguably one of the leading barristers in consumer law – Paul Brant of Oriel Chambers.

Well after the hearing, MBNA filed notice of discontinuance. The sceptic in me says they didnt want the issue about interest to come out at trial as it would be horrendously damaging but of course that is just my thoughts.

Anyway, im going to point out the interest issue here, so such is life 🙂

The client had a Bank of Scotland Credit card which was opened in 1994.

The terms of the original card provided that interest was simple interest. The terms did not provide an unfettered right to introduce new terms when the creditor felt like it.

The terms only provided a very narrow right to vary interest rates, but not the manner which interest was charged.

However, MBNA took over the card in around 2006, like they did with millions of others from the Bank of Scotland. So, MBNA without further thought it seems slapped new terms on the table and bound our client to them………or atleast they thought they did.

We disagreed. We pleaded that the Claimant was not entitled to compound interest and MBNA in their reply admitted that we were right bout the original terms of agreement, but it seemed MBNA were arguing they could vary the terms relying on their right to vary the RATE of interest.

We referred to Goode the leading authority on CCA work.

Paragraph 35.1 Goode Consumer Credit: Law and Practice refers when it is stated “Many variation clauses are drawn in very general terms, but the creditor should not assume that that these confer on him an unlimited power to alter the contract terms. A variation clause will, like the rest of the contract, be construed contra preferendem, and in the absence of clear language the court is unlikely to treat the clause as empowering the creditor to modify the contract in some fundamental manner outside the reasonable contemplation of the parties.’

Our view is that it is entirely correct, that the Creditor could not twist a clause to suit itself. Furthermore, the issue on compound interest has been to the Court of Appeal already in the matter of Armstrong v American Express. And in that case Amex had to reduce the balance from a compounded rate to a simple rate as their terms did not allow for compounded interest.

In our clients case, MBNA had been charging compounded interest over 6 years, so arguably there was a huge refund due our client which would of extinguished the debt in any event, that is certainly my own opinion.

Anyway, we will never know who was right and who was wrong…………

MBNA told today that the show must go on……..

I attended a Summary Judgment hearing today in a matter that has been rumbling on for a long long time.
It ought to have been listed for trial in the next few weeks but since the Claimant decided to chance their arm at seeking Judgment, the case now faces being allocated into the Multi Track.
Anyhow, the application was heard today and when i heard the Claimants submissions i remember thinking “why the hell have they even applied”. The case is crying out for a trial, the evidence needs testing, and i can say that there are holes in it the size of the channel tunnel in my opinion, and clearly this matter was not suitable for a part 24 app.
The Judge agreed, and was rather critical in his judgment too at one point pointing out that the costs awarded today equalled half of the sum claimed. From my side of the fence there was no way those costs could have been avoided, so its unfortunate but if a party wishes to make a part 24 application they should ensure that the evidence supports the application, unlike today when the Claimant tried to rely on a document which was newly introduced and which was equally as defective as the previous documents ( sorry i cant give away anything more at this stage). Laurel & Hardy anyone?

 

This matter will no doubt be off to trial in the near future and if we succeed on one of the points that are being run it will be very damaging and costly to MBNA by virtue of the card agreement they purchased from Bank of Scotland. I cannot say anything more for now, but will post up the judgment in the case once it has been heard.

 

Watch this space