This Advice applies only to England
(Advice can vary depending on where you live)
Firstly, I must stress that this article is based on a massive IF. It is extremely rare for a resort to actually act on their threats and issue the said Proceedings against a consumer.
However, like a blue moon, it can happen. And if it does and you want to know how to deal with it, then we can help.
I know it may be a lot easier said than done but you have to stay calm. There is no denying that Court Proceedings can be a scary thing, but what you have to remember is that the Courts deal on what is ‘reasonable’.
- Why did you stop paying your maintenance fees?
- Did you tell the resort and attempt to resolve the matter?
- Did you try to leave your contract through the resort?
- Was your timeshare miss-sold?
If you reasonably left the timeshare after the resort acted unreasonably then you should be able to resolve the matter.
The TCA is always here to support consumers. Whether it be advice on how to get out or assistance with Court Proceedings.
Below is a “How to” in the event that you wish to deal with the matter yourself.
Along with this – you can gain access to the CIVIL PROCEDURE RULES HERE
What are the Civil Procedure Rules?
The Civil Procedure Rules (CPR) are the rules of civil procedure used by the Court of Appeal, High Court of Justice, and County Courts in civil cases in England and Wales. They apply to all cases commenced after 26 April 1999, and largely replace the Rules of the Supreme Court and the County Court Rules.
You owe maintenance fees
If you owe money and have not paid the sums claimed, the people you owe money to, may eventually take you to Court. This is called making a claim.
The people you owe money to are called creditors. If one of your creditors takes you to Court, it’s really important not to put off or ignore the situation. You also have a need to know what action you can take in response to the claim you face.
If you take action speedily, you can avoid the situation getting any worse. If you fail to take action, you could end up a large bill and a lot more hassle than its worth. You could even end up having to pay back extra money which you didn’t need or have to.
This Article tries to explain what happens when you are taken to Court for debts like maintenance fees etc from timeshare companies. These cases are usually dealt with by the lower Courts called the “County Court”. If any payment order is granted against you, it’s called a “County Court Judgment”, or “CCJ”. Getting a CCJ may influence your credit rating.
You can find out what forms you’ll get from the Court, how to fill them in and what you can do if you don’t agree that you owe the money or if aren’t able to pay it back.
What a creditor should do before starting court action
Before taking you to court, the claimant must send you a warning letter. The letter should tell you that unless you pay back what you owe, they will start legal action within a certain amount of time.
Depending on the type of debt, the letter will either be a default notice or a letter before action.
You will get a default notice if the money you owe is a credit debt, such as a personal loan or credit card debt.
Debt collectors have no more legal power than a Claimant however they word letter in such a way which tends to scare you more and enter a belief that they have some mandate or higher authority where as in reality they don’t. You are under no obligation to assist them or engage with them. Dispite the many claims they make that they are there to assist the parties they are not and are only in existence to get the money the claimant purports you owe.
If and when a Court action is commenced, you will get a claim form. If you haven’t got a warning letter before you get this claim form or the letter doesn’t contain the right details, the Court action might not be able to go ahead. This will be called a “stay”.
If you don’t get a warning letter before a Court action is started or you want help to check the details, you can get advice from an experienced adviser at the TCA. Both you and your creditor have a duty to try and sort out the case without going to Court. If you get a “default notice” or a “letter before action”, you should make every effort to reach an agreement with your creditor to pay back what you owe, equally your creditor has a duty to listen to your defence , take on board the issues you have raised and fully address those issues and to do so will be reasonable and proportionate.
What to do when you get a claim form from the court
When a creditor starts a Court action, you’ll get a number of documents from the Court. These are a claim form and a response pack. Again don’t not panic.
The claim form gives details of how much your creditor is claiming you owe them. The response pack contains a number of forms. Some of the forms are for you to say whether you believe you owe the money. If you don’t have the same opinion. There is also a form you need to send back to confirm that you got the documents. You must send the confirmation that you have received the claim in a strict time limit – this will be detailed on the Court documents.
It’s very important not to ignore these documents. You should read the notes which come with the response pack carefully and deal with the documents by the deadline given. If you don’t deal with these documents, The Claimant may make an “Application for Default Judgement” against you. If this happens, you’ll have to pay back all the money your creditor is claiming, even if you don’t owe it. You may also have to pay interest and extra costs on top of this. (subject to you setting the summary judgement aside)
About the claim form
The claim form gives brief details of how much your creditor is claiming you owe them. This will include any interest they want to claim.
Check it’s a real Court form. Many have tried to scare consumers with bogus claim forms. If in doubt ring the Court.
It should have be given:
- A claim number which you should quote on any letter or document you send to the Court
- The Court’s official stamp. If the claim form isn’t stamped, it’s probably not a real Court form.
If the Court’s official stamp isn’t on the claim form, the person you owe money to might be trying to get you to pay them back by pretending to send you Court papers. This could count as harassment by your creditor and will probably be against the law. You should call us if in doubt. Consider that if you are harassed they will have to pay you compensation and any award can be used to set off any indebtedness which the courts awards in the future.
There will be more details about your creditor’s claim on a document called the particulars of claim. Usually these are sent with the claim form but they can be sent separately. If they are sent separately, it must be within 14 days of the claim form.
Dont be put off with the jargon. Many particulars contain purported facts and those facts are levelled against you which you may dispute. Consumers have a tendency to become alarmed. Dont be, try and read the “Particulars of Claim” as though they are referring to someone else.
About the Response Pack
The response pack contains the following forms:
- an Acknowledgment of Service to use to confirm that you got the documents. You only need to send this form back if you don’t agree you owe the money.
- an Admission form to use if you accept you do owe the money
- a Defence form to use if you want to say you don’t owe the money
You must do one of the following 3 things within 14 days of the Particulars of Claim being sent. That said, it is important that you have consideration and thinking time so;
- return the acknowledgment of service only, if you need extra time to fill in the defence form. This will give you an extra 14 days to return the defence form, but you must do this within 28 days of the particulars of claim being sent
- return the defence form to the court together with the acknowledgment of service
- return the admission form to your creditor
- return both the admission and defence form to the court if you accept you owe some of the money being claimed but not all of it.
You may have a need to contact your creditor to try and reach an agreement about paying back the debt without going to Court. This might be cheaper for you. If you do this, you will still need to meet the 14 day deadline for sending back the Court documents, unless you can get your creditor to extend the deadline. If your creditor does agree to extend the deadline, make sure you get this in writing and let the Court know.
Part 36 offers
At this early point in any legal dispute you should issue the Claimant an offer of settlement. It will serve you very well in the future in and when costs are to be discussed. If you are being pursued for say £12,000 and you make and offer at this stage of say £5,000 and at trial the Courts only award the Claimant say £4,000 even though you lose your opponents may have to pay your costs and his own as well. This is because you made a reasonable offer in an attempt to settle the case in order to mitigate future losses. This is something the Court expects.
You may need help to decide what to do. If you’ve got other debts as well, it’s a good idea to get advice about all of your debts in one go.
You can get help to reply to Court forms and to sort out your debts from an adviser, for example, at a Citizens Advice Bureau. To search for your nearest CAB, including those that can give advice by e-mail, click on nearest CAB.
If you agree you owe the money
If you agree that you owe all the money shown in the claim form, fill in the admission form in the response pack. The form asks for details of your financial situation.
Send the form back to your creditor, not to the court. You should also keep a copy and send it recorded delivery to prove you sent the form in case it gets lost.
Making an offer to pay instalments
You can use the admission form to ask to pay off the debt in installments. You can say how much you want to pay in each installment and when you want to pay them. It’s always best to offer something. A small offer, even as low as £1, is better than offering nothing at all.
This could be a negotiated benefit to you, as you can justify a low installment and as everyone one has a need for certainty you could them make a lower offer for full payment if you were able to borrow the sum from someone else.
If your creditor accepts your repayment offer
If your creditor is happy with the offer you’ve made, they can ask the court to make the order without a court hearing or the involvement of a judge. The court will enter a County Court Judgment in the Register of Judgments.
The order will be based on the amount you’ve agreed. The court will stamp the order to show it’s official and then send it to you. The order will tell you:
- how much to pay
- when to make payments
- the address where you have to send the money.
Don’t send money to the court.
You should keep your own record of payments you make in case there’s an argument between you and your creditor in the future.
You should send your payments to your creditor at least four clear working days before the date they are due to allow for any delays.
If your creditor doesn’t accept your repayment offer
If your creditor doesn’t accept your payment offer, a court official or a judge will decide what’s fair. There isn’t usually a court hearing. If there isn’t a hearing and you’re not happy with the decision that’s made, you can ask for it to be looked at again (re-determined).
You must make your request to the court in writing within 14 days. If the claim was issued in another court, it can be automatically transferred to your nearest court for the hearing. You don’t have to pay a fee for this.
If you are getting help, make sure you tell the advice agency that there’s an urgent time limit for you to act. This will help the advice agency to get you help quickly.
If you don’t make an offer of repayment on the form
If you don’t make any repayment offer at all on the admission form, your creditor will decide how much and when you should pay. Or they may decide to act as if you never returned the admission form and ask for an order that you pay the whole amount immediately.
Most court orders will be entered in the Register of Judgments, Fines and Orders. This could make it difficult for you to get credit in the future.
What if you only owe some of the money
You may accept that you owe some money to your creditor but disagree with how much. For example, you may disagree with the way that your creditor has calculated interest on the claim.
If you don’t agree you owe all the money, fill in both:
- the admission form, with details of what you do accept, and
- the defence form, with details of what you don’t accept.
Send the forms, to the court, not to your creditor. Keep copies and send them recorded delivery.
The court will tell you what steps you must take about the part of the claim that you don’t agree with. There may be a hearing, which you should go to.
You may need to make arrangements for paying the part of the debt that you do agree with. You can ask to pay by installments.
If the court agrees that you only owe some of the money, a court order will be made for that part. It will be entered in the Register of Judgments, Fines and Orders. This could make it difficult for you to get credit in the future.
If you don’t agree you owe the money
If you don’t agree you owe the money being claimed by your creditor, you will need to fill out the Defence form, giving your reasons. This is called defending the claim.
You must have good legal reasons for defending the claim. You can’t defend a claim for any of the following reasons:
- because you can’t afford to pay the money
- if you forgot that you had the debt
- if you never opened the letters your creditor sent you.
Good reasons for defending a claim may include:
- you can prove that you have already paid the money that your creditor says you owe
- you’re not the person who is named on the claim form
- you’re not the person who signed the agreement to take out the loan
- your creditor didn’t follow the proper procedures when they lent you the money. For example, they may have got you to sign an agreement which had something wrong on it or not given you the right documents
- you were under age when you signed the agreement
- you borrowed the money a long time ago and the time limit for recovering it has run out. For example, a creditor only has six years to take court action to recover a credit debt. The six year limit starts from the date of your last payment or when you last acknowledged you had the debt.
If you think you’ve got good legal reasons for defending the claim, it’s important to act quickly to give yourself as much time as possible to put your case together. You should:
- send back the acknowledgement of service in the response pack. This will buy you 14 extra days to return your defence
- get advice from a specialist debt adviser before filling in the defence form.
To find out more about whether you might have a good legal reason for defending the claim.
What if you ignore the claim form
If you don’t reply to the claim form within 14 days, your creditor can ask the court for an order to be made against you. This is called entering judgment by default. It means that you won’t have an opportunity to put your case to the court and your creditor can start to take more serious action straightaway. However, in some circumstances it may be possible to apply to have the judgment changed or set aside at a later date.
Your creditor can decide what the order should say about how and when you have to pay back the money. You usually have 14 days to pay, although the order could say it has to be paid immediately (forthwith).
The court will send you the order. It will tell you:
- how much to pay
- when to pay
- the address where you have to send the money.
Don’t send the money to the court.
Once the court order has been made, it’s entered in the Register of Judgments, Orders and Fines. This may make it difficult for you to get credit in the future.
How much interest can the creditor claim
As well as the original money you owed, your creditor can claim interest on the debt. This will be charged up to the date when the court order is made. The details of how much interest is being claimed should be shown on the claim form.
In some cases, a creditor can claim interest after the date of the court order. If your creditor does this, it’s a good idea to check with a specialist adviser that the creditor is acting correctly. Creditors sometimes claim interest after judgment when they shouldn’t.
What if you still don’t Pay
If your creditor gets a court order against you, you have to pay up when the order tells you to. If you don’t pay up as ordered, your creditor has a number of other options to make you pay. This is called enforcement action.
Your creditor will need another court order to take enforcement action. They may be able to get an order to:
- send bailiffs to your home to take your things away
- have money taken from your wages to pay the debt. This is called an attachment of earnings order
- take money that you are owed by someone else from your bank account. This is called a third party debt order
- secure the debt against your home or other property you own. This is called a charging orderand means that you could lose your home if you don’t keep up the repayments.
If you need any help or advice please do not hesitate to contact the TCA.
For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk