In March 2017 the Pre Action Protocol for Debt was at long finalised, it’s here: Debt PAP. It comes into force on 1st October 2017.
Here is my article on How to Reply to a Letter Before Claim.
It has taken many years of negotiations, consultations and delays to get here. I’ve asked a couple of experts for their reaction to the news.
Tim Lett, who has been involved for the last four years in getting this protocol agreed, writes:
I am very pleased that the Debt Pre-Action Protocol has now been signed-off and published, and will come into effect on 1 October this year. It is much needed, and something I have been closely involved with it for more than four years, through my work on the Civil Procedure Rule Committee (representing the viewpoint of lay advisers and litigants in person) and, latterly, through working on the Debt Pre-Action Protocol Subcommittee of CPRC.
It has been a long time coming, and hard slog, having been subject to vigorous and protracted opposition from much of the credit and collections industries.
Initial attempts to adopt a Debt Pre-Action Protocol (with which I was not involved) date back about two decades. These were not successful, with some creditors expressing satisfaction with comments to the effect that they had “seen it off” or had “kicked it into the long grass”.
The current work to achieve a Debt Pre-Action Protocol was kick-started by reference to the need for one in the Jackson Report (on court costs), with initial work then done by the Civil Justice Council before the function of advising the Master of the Rolls (the Head of Civil Justice) on the content of Pre-Action Protocols moved to the Civil Procedure Rule Committee (CPRC). CPRC then set up a sub-committee to deal with several pre-action protocols including the one for debt but as the other protocols were completed and the one for debt remained in contention, CPRC Debt Pre-Action Protocol then set up the Debt Pre-Action Protocol Subcommittee with members from the advice sector and credit industries. It has gone through several drafts, two public consultations but with continued determined resistance from parts of the credit sector.
I think content of the Debt Pre-Action Protocol will be useful for debtors and debt advisers, requiring time and information to be provided, and going some way to providing a client with enough information with the letter before claim to take advice on their liability position before a court claim is issued, and is fair and reasonable to creditors.
Regrettably, the Protocol does not require firms to supply everything clients need at the letter before claim stage – in particular a copy of any written agreement on which a court claim would be based does not have to be provided with the letter before claim. However, the Protocol provides that it should be provided on request in response to the letter before claim, before a court claim is issued.
The issue of whether the Protocol should require a copy of a written agreement with the letter before claim was very hard fought right to the end, and subject to very heavy lobbying by the credit industry. It was only decided at a meeting of CPRC on 9th December 2016, as it was a matter on which the members from the credit and advice sectors of the Debt Pre-Action Protocol Subcommittee could not agree.
Paul Tilley, a litigation executive specialising in Consumer Credit Law, writes:
The amendments to the pre action protocol are a big step in the right direction. Far too many cases land on my desk where proceedings have been issued where the consumer has asked for documents such as the contract and the creditor has failed to provide it due to the fact that they fail to carry out their due diligence.
With the amendments to the protocol, now consumers should be able to obtain all of the information and documentation they need to be able to ascertain their liability. All we need to do now, is ensure that the consumers are educated about their rights under the new protocol.