UPDATE March 2017 The appeal in the Green v Wright case has been allowed – so IVA firms are allowed to continue to collect PPI after an all-assets IVA has finished, even if the debtor hasn’t agreed to this before the completion certificate is issued.
The decision is here: Green v Wright verdict Approved Nov 2016.
Blogs on the decision by some of the lawyers that have been involved:
- Paul French’s blog on Lexis: PPI claims survive completion of IVA for creditors (Green v Wright) (he was the barrister for the IVA firm in the Appeal)
- Kathryn Maclennan’s blog: Green -v- Wright: complete does not necessarily mean complete (she was the solicitor for the debtor in the original court case)
- Coffin Mew’s blog: Green v Wright (they were the solictors for the IVA firm in the Appeal).
My immediate thoughts following this decision:
- you need to check if your IVA is an “all assets” IVA. If it is not, this Appeal Court decision is not relevant. The following points assume you have an “all assets” IVA;
- if a PPI refund has been paid to your IVA company and you were hoping it would now come to you instead, this isn’t going to happen;
- if a lender is holding on to a PPI refund as it wasn’t clear who it should go to, this is now going to be paid to your PPI firm;
- if PPI money has been paid to you, I hope you still have it as you may well have to pay it to your IVA firm. As I wrote in my original article “Don’t spend it, however tempting this is.“
It’s going to take some time to work out the implications of the Court of Appeal decision. At the moment I am mainly interested in the following points:
- what are the implications (if any) for someone whose IVA failed?
- what are the the implications for someone whose IVA was ended early with a sum being offered in final settlement? This may depend on the wording in each case, but some parameters to assess this would be helpful.
- what is going to happen where PPI refunds have been paid to the debtor in the last year or so, presumably incorrectly? I think the RPBs and the Insolvency Service should be trying to establish some guidelines.
- the case is only relevant to “all assets” IVAs. How many IVAs do not fall into this category?
Changes to PPI reclaiming
The day after the Appeal Court decision was published, the FCA announced that it is setting a deadline of 29 August 2019 for PPI complaints to be submitted So there will be a final end date for these complaints and people don’t need to feel that their IVAs will go on for ever.
That announcement also covers the new “Plevin” rules – PPI can now be partially reclaimed if more than 50% commission was paid, and as the average commison was over 60% this will be the majority of cases. As a result PPI claims that had previously been rejected may now be re-opened and this coukld affect many people whose IVAs have been completed.
As always with articles about IVAs, I need to point out that I am not a lawyer, I have not seen the terms of your IVA, and this article is not advice.
If you feel you need advice on your situation, for example if you have been sent a PPI refund cheque and are unsure what to do, good places to go include:
- your local Citizens Advice Bureau or Law Centre – here the advice would be free;
- a solicitor that has experience of personal insolvency cases – here you would probably have to pay.
You are welcome to comment below. I understand that many people with IVAs feel very upset by the Court of Appeal decision and it is fine to express that, but please keep your comments polite. Ultimately the most important thing is for you to know where you stand and what your practical options are.
Please note that I can’t give you advice on what you should do or whether Green v Wright applies in your situation. See above for places to get advice.
This article was originally published in 2015. It has been completely re-written in March 2107 following the Appeal Court verdict. I will continue to update the article in future.