Enquiry Form

Unenforceable Catalogue Credit Agreements


Miss N. Was please to received confirmation from Bournes on the 8th of September 2009 that Shop Direct Finance Company Limited will not be enforcing the outstanding balance of £2208.61

Without the existence of a Consumer Credit Agreement between a debtor and creditor, debts cannot be enforced. The reason for this is that the Consumer Credit Act clearly states that unless a document can be produced in court, an order cannot be made. A district judge would have no discretion to issue a County Court Judgment where a credit agreement cannot be produced and that agreement existed prior to April 2007.

It may seem unfair to some people that debtors are allowed to get out of paying back their debt because a credit agreement cannot be produced, which is why we want to take you back to how the Consumer Credit Act came about.

Before 1974, consumer credit law developed in a piecemeal way, largely as a response to advances in the retail practices. Numerous different Acts were involved dealing with the type of lender involved rather than dealing with the credit as a whole.

In 1968 the Crowther Committee was appointed to review the whole legal framework of credit granting and security. It was acknowledged that the existing law was ‘gravely defective’. The most serious weaknesses were, lack of distinction between commercial and on-commercial transactions, there were multiplicity of legislation with 23 different lending institutions, each having its own legislation. The Crowther Committe report led to the Consumer Credit Act, its title embodying the principle that what was important was the nature of the business conducted and the amount of credit advances, with the interest of the consumer paramount, rather than the status of the lender.

We often remind the courts on how the Consumer Credit Act was developed as, as far as we are concerned, the government had intended the Act to protect the consumer. Creditors are able to afford legal advice to ensure they comply with these regulations, whereas the debtors cannot.

We understand the Ministry of Justice is keen to clamp down on companies who claim credit agreements are unenforceable. We don’t make any promises that we can write off debts, but believe that the majority of credit agreements existing prior to April 2007 are unenforceable.

As part of the debt consolidation advice, we would always check each and every one of your agreements to see if you may have a claim. We can usually tell you within the first three months of the debt programme.