Creditor objected to the instalment order - unpaid invoice for services provided.

[inabind]

My husband and I had a CCJ made against us in Nov 2009.

 

Shortly after it was made we applied to vary the order to pay £25 instalments.

 

I sent in my income and expenditure sheet and my husband sent in a letter saying he was unemployed.

 

Last month a judge made an order for me (in my name only) to pay £60 per month starting from the end of this month which I have done.

 

yesterday morning we received two letters from the court.

 

One saying the claimant objected to the variation order and a hearing has been set.

 

Another one saying my husband is in default and the claimant has applied for a charging order

- the hearing is in april. The house is in my sole name though.

 

can a charging order be made even though I am paying the instalments and there are no arrears.

 

Can a charging order be made citing that my husband is in default even though he not on the mortgage or registered as having a beneficial interest?

 

I know I definitely need to see a solicitor about this, but I thought I could get some expert advise from you

[PriorityOne]

I can't see how a charging order can be made on your house.... for your husband's debt, no.

 

However, you've also said that "my husband and I had a CCJ made against us in November 2009" So is this a joint debt or not?

 

Edited February 20, 2010 by PriorityOne

[inabind]

hi priority one.

 

the debt for which we have a ccj is a joint one.

[PriorityOne]

Ok.... there are two issues going on here, as I see it.

 

Firstly, there's a hearing because the creditor's not happy about the variation order, despite you making regular monthly payments towards this debt. You must attend this hearing; as it's your chance to explain how regular payments have been maintained and that it's all you can afford.

 

Secondly, they are saying your husband is in default although you said he sent a letter in. Unfortunately, if this wasn't sent by rec. delivery, they will claim not to have received it.... which makes it look as if your husband has just stopped paying. Having said that, it looks as if they're unaware that the house is in your name only.... so trying for a CO re. your husband will be a pointless exercise for them. If they find this out before going to court though, they may switch tactics and try for a CO for you instead.

 

If this happens, you need to defend based on the fact that regular payments have been made under the CCJ. Who is the creditor/DCA?

 

What is the court paperwork asking you to do (if anything) in both cases?

 

[inabind]

Good morning.

 

The first letter is a bit confusing come to think of it. It says,

 

Upon the Courts own motion. The Court has made this order of its own initiative without a hearing. If you object to the order, you must make an application to have it set aside, varied or stayed within 7days of receiving it.

 

It is order that

The claimant's objection to the variation order to be listed etc and then it give the date for the hearing for the claimant's objections to the variation order and a time estimate of 15mins.

 

From my understanding I have to turn up and argue that my payments are up to date and that what I am paying is reasonable. Do I have to submit my objections in writing to the Courts within 7days?

 

The second letter is from the claimant's solicitors, they served the interim charging order themselves i.e. it didnt come from the court. In that letter was a copy of their application for the the charging order and the interim charging order which gives the hearing date at which the judge will decide to create the order or disharge it. I spoke to national debtline and they said for now the forst hearing is the big one. If the judge decides that my payments are reasonable etc then I can ask him to dispense of the second hearing (application for the charge)

 

Can I ask to have both issues determined at one hearing? I cant afford the time off work, its unpaid.

[PriorityOne]

Ok... I'm going to flag this one up with the Site Team for you..... as court procedure is not my area....

 

[inabind]

Thanks.

[citizenB]

When is the hearing ? Who is the creditor ?

 

This isnt within my knowledge, but am just asking questions that those who will be able to help will probably ask.. in order to save time:)

 

I would suggest you make sure you have all your paperwork collated ie proof of payment, the Judges order that made you responsible for the payments.

 

I wouldnt have thought any charge could be placed against your home for any debt of your husband if has no interest and it isnt joint ownership.

 

Someone with more knowledge will be along soon.

[supasnooper]

You must attend the Variation Order hearing to state your objection.

 

As CitizenB has advised, take along all the Court paperwork especially the Judges Orders.

Also take along your Income\Expenditure Statement for the Judge to view.

[inabind]

Thanks for the help so far.

 

The original debt wasnt a loan. It was an unpaid invoice for services provided.

[caro]

I don't know much about charging orders, but you may find this thread helpful.

 

http://www.consumeractiongroup.co.uk/forum/legal-issues/203298-guide-charging-orders-orders.html#post2214288

[inabind]

I had a CCJ made last year requesting payment forthwith.

I applied for the variation of the order to pay by instalments.

The court allowed this but the creditor objected and even though my payments are up to date, I have a hearing on Friday re: the instalments

. Can someone help me, what actually happens at the hearing?

Does the judge go through my income and expenditure to decide whether the instalments are reasonable?

The creditor has also applied for a charging order, the hearing for that is next month.

If the judge decides at the hearing on Friday that my payments are reasonable will the charging order hearing still take place next month or can he cancel it?

P.S. I do not know why they are objecting, presumably they want me to pay more.

Should I be told beforehand what the grounds are for them objecting, after all I have to defend why my current monthly payments are reasonable.

I had a charging order granted despite having an instalment order in place that I have been paying. It is not in default.

 

Can I appeal against the charging order arguing the following:

 

Section 86(1) The County Courts Act 1984:

 

Where the court has made an order for payment of any sum of money by instalments, execution on the order shall not be issued until after default in payment of some instalment according to the order.

 

This was further considered in the case of Mercantile Credit V Ellis in The Court of Appeal 1987. It was found that the wording of the Charging Orders Act states quite clearly that no further action could be taken without a default in payment. It should be noted, however, that in the case of Ropaigealach V Allied Irish Bank CA Nov 2001 where an instalment order is made AFTER an interim charging order has been made, a court has the jurisdiction to make a Charging Order final.

 

(I included Mercantile in my objection but not the County Courts Act)

[rhodium78]

Haven't looked into your case in detail but it depends...

 

In Ropaigealach v Allied Irish Bank [2001], the judge there considered the Mercantile Credit case and came to the conclusions that:

 

"There was jurisdiction to make a charging order absolute if a charging order nisi had been obtained before the instalment order had been made. It was also clear that in cases such as the instant case, where under the instalments order the debt would not be paid for many years, and where there was more reason to secure payment, there was nothing wrong in principle with the co-existence of the orders as s 1(1) of the Charging Orders Act 1979 set out. Further, when exercising its discretion under s 1(5) of the 1979 Act, the court could take all relevant circumstances, including the existence of the instalment order, into consideration. In the instant case there was no ground on which the court could interfere with the exercise of the court's discretion."

 

Charging Order Nisi = Interim Charging Order

 

Did you get the interim charging order BEFORE the court mandated an instalment order or afterwards?

 

That will determine the likelihood of your success.

[inabind]

hey there,

 

the instalment order was made on the 1st of feb and the application for the interim charging order on the 10th of feb.

[rhodium78]

From what you have stated, you do have grounds to appeal.

 

According to case law, the interim charging order should never have been granted in the first place with an installment order made which was not in default.

[supasnooper]

A couple of questions -

 

1/ What were the terms of the Installment Order ?

 

2/ Did you make any payment to the creditor under the Installment Order ?

[inabind]

1. On the application of the defendant and the court having considered the papers received from the parties.

It is now ordered that the def pay the claimant the outstanding sum by instalments of £xx for every month the first payment to reach the claimant by xxx.

2. Two payments before the final charging order hearing.

That is what I thought too.

He kept saying having the charging order wont cause me hardship

. Looking back I should have said it will because of the charges of the hearing and costs that will be added to the judgment debt.

My understanding is that if they had applied to the High Court then a charging order can be made even when you are not in default.

In the County Court though this isnt possible.

Should I reduce the debt to under £5k (threshold for the High Court) to make sure that they dont apply for one at the High Court since I am appealing?

[rhodium78]

Let's rewind a second... In the hearing for a charging order nisi... was the judge aware of the fact that an installment order was made? Out of curiosity, was it a district judge or circuit judge?

 

Ps... 2 payments before the final charging order or the charging order nisi?

Edited April 7, 2010 by rhodium78
typo

[inabind]

He was aware.

He was a district judge.

Not sure what you mean.

final charging order hearing = charging order nisi?

By the time the charging order was made absolute I had paid to payments under the instalment order.

[rhodium78]

Old terminology -

 

Charging order nisi = interim charging order

Charging order absolute = final charging order

 

Hmmmm.... not convinced that a district judge would err on such a point so there might be some pertinent piece of information missing here. Stranger things have happened.

 

To all intents and purposes, appeal but also mention the fact that there is negative equity (if there is), etc. You can see other charging order threads for other points to appeal on.

[inabind]

With all due respect I stand to benefit nothing by twisting the truth.

What I have said is exactly what happened.

That is why I am asking for help because what happened defies logic to me.

As for the negative equity position I argued it and he says is does affect me in any way.

It is a risk that the creditor takes, if they fail to recover any money after the sale of the house its their problem.

Thanks for your responses though.

[rhodium78]

That wasn't a slight and I apologise if it was misconstrued as that.

To be honest, an appeal is required and you should get more margin with a circuit judge but at least then he/she can clarify your position based on the evidence in front of him/her.

I don't have the luxury of seeing the evidence that the opposing counsel has presented which is why I queried whether there was something else missing.

Good luck and let us know how you get on.

[inabind]

Will let you know. Spending the weekend completing the n161 form

[meursault22]

This same thing has happened to me. Found this information though. Is this right? I find it very worrying.

 

 

Slapper & Kelly THE ENGLISH LEGAL SYSTEM, Tenth edition p368

 

"Charging Orders.... Under the old law, the court could not make a charging order when payments due under an installment order made to secure the same sum were not in arrears. ... The Tribunals, Courts and Enforcement Act 2007 removes this restriction and enables access to charging orders in circumstances where a debtor is not yet in arrears with an installment order."

It then goes on to say "As a safeguard, the Act allows the Lord Chancellor to set financial thresholds beneath which a court cannot make a charging order or order for sale, in order to ensure that charging orders are not used to secure payment of disproportionately small judgement debts."

 

In my experience, the thresholds that have been set are so low that they are easily exceeded by adding court costs even if the original debt is only a few pounds - some protection that is for the householder! Not only that, but the judges I have encountered seem to feel that this threshold makes the precedent of Robinson v Bailey redundant.

Edited April 22, 2010 by meursault22

[inabind]

Hi mersault22,

Sorry to hear that the same thing happened to you.

Yep.

That is also my interpretation of s93 of the 2007 Act.

Decided not to appeal after all because even if I was sucessful, the Claimant could always apply for a charging order in the High Court and the fact that the instalment order was not in default wouldn't matter.

This would mean more costs for me and the heartache of going to court again.

Figured I might as well hang onto my £160 : )