Mortgage taken out in 1988. Handed keys back October 1992. Missed 3 mortgage payments due to redundancy. Do not remember signing or even seeing MIG policy, but did pay a premium to proceed with the mortgage. Now being taken to court by Curtis Solicitors threatening Bankruptcy. Have hearing to establish what documents we need to support our defence. Received very poor copy of an MIG policy this week after several requests for it failed, so had to pay £60 for the court to ask. That worked, but accompanying letter said it had not been requested previosly, desite the fact we have a letter from them dated three weeks earlier saying they would send it. The MIG copy arrived Wednesday with a letter saying phone calls would not be accepted, On Thursday a letter arrived accusing us of not responding, and suggesting Mondays court date be cancelled, but wanting to go ahead with hearing two weeks later, also saying they would be asking for costs. On Monday need to be able to request all info that will possibly help. Feel very strongly that handing the keys back was the only option, Halifax seemed to be pushing for it, but had no idea that we would or could be pursued by Sun Alliance, as is on the copy of MIG, or Royal Sun Alliance, who Curtis appear to represent. £22,000 is the amount we are being pursued for. Regards Robert Would be so grateful for any advice, comments.

-- Robert (Bright@spark22.freeserve.co.uk), February 29, 2004

Answers

Firstly, I would recommend you read as many previous postings as you can on the Q&A site and read/follow the "Do's & Dont's on the Home Repo page too. Sarn the lender/insurer/debt collector and put them to strict proof. Be advised lenders read this site.

A lender/insurer has 12 years under the Limitation Act 1980 to chase you (see Bristol & West v Bartlett - July, 2002). The 12 years usually runs from the 2nd or 3rd missed mortgage payment, however, you need to check your mortgage terms & conditions to be certain, it could be, for example from the 1st missed mortgage payment. In respect to interest the limitation period is 6 years (see postings on Home repo Q&A for more details). See also the posting ***The 12 Year Limit and Endowment Mortgages*** , if you defaulted on the endowment earlier than the mortgage repayment it could mean the clock starts running even earlier.

You need to check that the alleged debt hasn't been acknowledged in any communication with the creditor (a part payment can acknowledge the debt as well) because this can restart the limitation period. Be careful not to acknowledge the debt by stating on any communications that you do not acknowledge the debt , that you deny liability and that you dispute the debt(phone calls cannot acknowledge the debt). If the 12 years are up then you cannot acknowledge the debt afterwards. If you have acknowledged the debt you may be able to resile, but that, as far as I know, has never been tested in court. If you use statute barring as a defence this needs to be pleaded as part of the defence it is not automatic. If this mortgage was a joint liability one then be aware that any Ex joint partner may have acknowledged the debt for all parties by making a part payment. if the lender has a Money Judgment Order (MJO) then, in theory, they can chase you indefinitely, although I've never heard of this happening, yet.

You also need to check to see whether the CML 6 year voluntary Code (see below) applies in your case.

The Council of Mortgage Lenders have a Voluntary 6 year code which states:

"In addition, from 11 February 2000, lenders who are members of the Council of Mortgage Lenders have agreed voluntarily that they will begin all recovery action for the shortfall within the first six years following the SALE of a property in possession. Anyone whose property was taken into possession and sold more than six years ago, and who has not been contacted by their lender about recovering any outstanding debt will not now be asked to pay the shortfall. THE ASSOCIATION OF BRITISH INSURERS supports this approach on behalf of the mortgage indemnity insurers.

All lenders which subscribe to the Code have now agreed to adhere to it whether they are a CML member or not. You can check whether a lender subscribes to the Mortgage Code by phoning The Mortgage Code Compliance Board on 01785 218200."

See CML webpage for full explanation: www.cml.org.uk/servlet/dycon/zt- cml/cml/live/en/cml/pub_info_dept

Take a look at these two websites that should help:

http://www.osborneclarke.com/publications/text/mortgageshortfall.htm

http://www.propertylawuk.net/mortgageshortfall2.htm

Finally, Curtis Solicitors are well known for using Statutory Demands which require a fast response, take a look at the section about this on the Home Repo site.

Please be advised that I'm not a professional advisor so please check all this out with one. If you have any further queries just post them up. Good Luck.

Mark.

-- M Amos (idgroms@hotmail.com), March 01, 2004.

Robert,

You may find the following site of interest too:

http://www.debtadvicebureau.org.uk/bankruptcy/statutory_demand.html

If you do the following (obtained from a solicitor) this should get you more time:

Parties can agree to an extension of up to 28 days for filing a defence. Where such an extension is agreed, the defendant must notify the court un writing (CPR 15.5).

If this cannot be agreed, the defendant can apply to court to extend time for filing a defence under the court's general powers of case management.

CPR 3.1(2) states that except where the rules provide otherwise, the court may -

(a) extend or shorten the time for compliance with any rule, practice direction or court order (even if an application for extension is made after the time for compliance has expired).

I assume that any such application would be on court form N244 with a fee of £50.00 but it would be sensible to check this with the relevant court (as not all courts do things the same way!)

In the N244 application, the reasons for the extension must be set out, e.g. the claimant's delay/failure in providing information/documentation, and it should be stated that, under the 'overriding objective', failure to grant an extension would result in a miscarriage of justice. This should all go on part C of the form, on the reverse side.

Some info on setting up a defence (also from a solicitor):

One general point on defences that it's useful to remember is that it is usually not enough to make a mere denial, it is usually necessary to say why something is being denied.

For example, it is not enough to say "I deny owing the money". The reason why the debt is denied needs to be stated: e.g. "because I have already paid the claimant", or "I do not admit the claim because the claimant has failed to prove the debt".

Also, if a claim is to be defended, it is useful to go through the particulars of claim and respond to them one by one, and say, for example, "para one of the partics of claim is not admitted", "para two of the partics of claim is denied. The claimant has failed to prove the debt. The defendant puts the claimant on proof etc. etc." or "The defendant admits para 3. of the particulars of claim" etc.

Hope this is of use, Good Luck.

Mark.

-- M Amos (idgroms@hotmail.com), March 01, 2004.

Just a comment;

If the solicitors try to kid you that you need not attend, or that you should not attend, a hearing. BE THERE.

Because they will.

Best of luck.

-- Michael (mleo@zcredit.plus.com), March 02, 2004.

My situation is identical to yours. Even the amount, curiously. Keep us posted on your progress. I'm waiting on Curtis's next move, although I think they may be out of time re: Limitations. Let me know how you get on.

-- (richardpowell99@hotmail.com), March 02, 2004.