~HFO Capital Limited -v- Robinson

[CleverClogs (RIP)]

Re: ~HFO Capital Limited -v- Robinson

i am unaware of any case law on this point which either answers one way or the other

I do not however see that the assignment of a debt when there is a covenant in the contract allowing for such could bring the agreement to an end.

It is nevertheless difficult to understand how an agreement might not be repudiated by assigning it to a party that could not lawfully perform that contract.

The following is an artificial and wholly imaginary case, poorly and inexpertly constructed by me to illustrate the point.

First of all, though, I would separate the two choses being assigned - the credit agreement and the right to collect such debts that had already been incurred under that agreement.

Considering only the first chose - the agreement...

Suppose that a customer A had contracted with a company B to purchase a motor-car. Before the vehicle was supplied, however, B assigns the contract to another company C which actually specialises in selling stolen motor-cars and does nothing else. As no motor-car which A might purchase from C would have good title with it (non dat quod non habet) it follows that the contract cannot lawfully be performed by C unless and until C obtains a motor-car by lawful means.

My belief is that the contract to supply a motor-car would have been repudiated - or would have become void - upon the assignment of the contract from B to C.

Your belief seems to be (if I have understood you correctly) that, if C were subsequently to trade lawfully or were to assign the contract to another company D that was already trading lawfully, C or D (as applicable) could then insist upon payment for the motor-car that the company would supply, or a sum in damages for breach of contract.

[Paul.]

Re: ~HFO Capital Limited -v- Robinson

The way Bradley Say explained this point was, the starting point is the contract itself, the CCA merely adds a gloss on contract law, it does not however replace it so we still need offer, acceptance, consideration etc ( yup im being pedantic here)

now then, Bradley pointed out that the rights to assign are in the contract, so they can sell it, its a contractual right

The right to set a zero credit limit on breach is in there too , they go as far to say they will give notice of this as soon as possible, which does seem reasonable, and even s87 looks on this as not being within the ambit of s87 default notices for breach etc

so we know the creditor can sell to anyone, he can set a 0 credit limit immediately under the terms of his contract

If this is right, then i dont see how by selling to an unlicenced DCA he is repudiating the contract.The DCA has no contractual requirement to extend credit, that can be restricted and often is before the sale, so i dont a see how selling the debt amounts to repudiation

[PlanB]

Re: ~HFO Capital Limited -v- Robinson

The Licencing regime is different,


The OFT do a excellent fact sheet on it too, and it states that a contract made with an unlicenced creditor cannot be enforced until the creditor obtains a determination from the OFT however when the creditor buys a debt without a licence he is only barred from enforcement til he obtains a licence.

The OFT deal with the criminal offences side of things

Could this mean that all the CCJs obtained by Experto Credite on behalf of Varde Investments (MBNA) during the period of November 2010 and June 2011 could now be made null and void since Varde didn't have a CCL at the time of their enforcement? And can I look forward to the OFT dealing with the criminal offences side of things in future?

[gravytrain]

Re: ~HFO Capital Limited -v- Robinson

I had not read this and i find it very interesting.
The thing I picked up from it was the Dj's interpretation of section 87 and the remedies described by it.

Also I am unsure of how he interprets the relationship between the contractual termination clause and the termination permitted by the breach and subsequent issuance of the DN.
These were identified as separate mechanisms by by the EU regs, in Woodchester and Brandon,and is basically the difference between contractual, and termination resultant from repudiation of contract.

I must admit that I was of the same opinion as Mr Say in that I thought the remedy must reflect the actual breach of the agreement, and in fact be a remedy in law.

The judge here seems to think(and he may be right) that the remedy is whatever the creditor says it is, and does not have to be the same as a legal remedy for breach. The question that must be asked if this is the case must surely be , if this is not a remedy in law what prevents the creditor form further pursuing enforcement.

He says that the error in Woodchester was that they contradicted themselves by saying the remedy would be a certain figure and then miscalculating, rather than it not being representative of default figure.

[gravytrain]

Re: ~HFO Capital Limited -v- Robinson

The way Bradley Say explained this point was, the starting point is the contract itself, the CCA merely adds a gloss on contract law, it does not however replace it so we still need offer, acceptance, consideration etc ( yup im being pedantic here)

now then, Bradley pointed out that the rights to assign are in the contract, so they can sell it, its a contractual right

The right to set a zero credit limit on breach is in there too , they go as far to say they will give notice of this as soon as possible, which does seem reasonable, and even s87 looks on this as not being within the ambit of s87 default notices for breach etc

so we know the creditor can sell to anyone, he can set a 0 credit limit immediately under the terms of his contract

If this is right, then i dont see how by selling to an unlicenced DCA he is repudiating the contract.The DCA has no contractual requirement to extend credit, that can be restricted and often is before the sale, so i dont a see how selling the debt amounts to repudiation

In addition to this the fact is that the contract has already been repudiated by the debtor, the CCA merely steps in the way of enforcement and allows the debtor to remedy. Also it is quite possible for a contractual term to be effective even post termination, for instance the ability to apply post termination or even post judgment interest is only possible if permitted by a term within the contract.