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Friday, 15 January 2016

MIL Collections fail in court - Champerty and Maintenance

MIL Collections Ltd v Stephen B Case No B1QZ7N32, Oldham CC 15/01/2016.

This was one of the Car Park Management Services (sole trader)/Car Park Management Services (CPMS) Ltd cases.

MIL again failed to turn up but had, it seems, made an application for the matter to be heard "on the papers". They had failed to communicate this to the defendant who duly arrived at the court. 25 minutes in, the judge called the defendant who was asked to prove his case.

Mr B attempted to have the case dismissed on the basis of MIL's non-attendance but the judge was having none of it. This does seem a little unusual. MIL are required to inform both the court and the defendant that they want the case heard on the papers, and the small claims track rules are laid out here:

https://www.justice.gov.uk/courts/procedure-rules/civil/rules/part27

Rule 27.9(2) allows a judge to strike out a claim in these circumstances, and given this is a repeated occurrence from MIL The Prankster thinks the courts should not be letting them get away with it.

Mr B pressed on with well prepared arguments - lack of standing, no contract offered on the signs, where there are terms of exclusion motorists cannot be held to a contract etc. However it was the champerty/maintenance argument that the judge latched onto.

He duly found that MIL's claim was founded in maintenance and the matter was dismissed. He specifically observed that had the original company failed and MIL had acquired all the assets then their proceedings would have been permissible.

Costs were awarded to the defendant payable within 14 days but the defendant was on too great a high to record what he was awarded. The judge also ruled that MIL had failed to show a contract exists, and there cannot be a contract if the case is for trespass.

Prankster Note

If you say, fall behind on payments for your car then there is a real debt. A second company could purchase that debt from the original people who sold you the car, and could then try and enforce it.

A parking charge is different. If the parking charge is not paid it is because the motorist disputes the debt does not exist and believes the charge is not valid. MIL collections hawked themselves around the parking companies and attempted to buy up unpaid charges for £1 each as recorded in the British Parking Association council minutes of 3rd June 2015. MIL have therefore bought the right to sue for a disputed charge.



This falls under the category of champerty and maintenance and is not allowable.

Champerty and maintenance consists of dealing in bare litigation where the litigating party does not have a direct interest in the claim. In other words, you can sell an interest in something (e.g. a debt) but you cannot sell a mere right to sue.  Specifically you cannot sell the right to sue for breach of contract.

Dealing in bare litigation is forbidden for public policy reasons - it encourages unnecessary, frivolous or vexatious litigation (as MIL is proving daily).  Champerty and maintenance used to be illegal but, as with so many things, it was decriminalised when better regulation of the legal profession made such behaviour less common (until the advent of PPC’s and their debt collector brethren, that is).

MIL Collection therefore appear to have bought a worthless collection of rights to sue. Perhaps the parking companies will give them their £1 back if they ask nicely.

MIL Defence

The Prankster suggests that defendants who dispute that MIL Collections have a valid claim against them consider adding the following to their defence.

1/ The Claimant has provided no evidence that there was a valid assignment of debt, in the form of a Deed of Assignment signed by the original creditor, pursuant to s136 of the Law of Property Act 1925. Absent such evidence, the Claimant no locus in this matter.

2/ Even if there was a valid Deed of Assignment, the Claimant has no interest in, or privity to, any purported original contract, and it is submitted that such an assignment would be champertous. The sole purpose is to enable the Claimant to instigate legal proceedings, which is a chose in action, and on that basis the Claim should be struck out by the Court, as was the case in MIL Collections v Stephen Bowker, Case No B1QZ7N32, Oldham CC 15/01/2016

Happy Parking

The Parking Prankster

13 comments:

  1. It sounds like it may be possible to take this line against actions by DCBL as well?

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    Replies
    1. No, because they don't buy the debt, they simply act as debt collection agents for the original creditor.

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  2. Could CPMS still take court action if they buy the "debt" back?

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    Replies
    1. The fact that they sold it for £1 suggests they lack the necessary cojones :)

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    2. CPMS or CPMS ltd?
      Indeed; most car parks have signs saying CPMS but the PCN comes from CPMS Ltd. Two different legal entities!

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  3. Extremely useful this. I am going through exactly the same issues with MIL having instigated Court Proceedings against my son who is in New Zealand.

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  4. I am going through exactly the same with MIL who have bought a claimed debt from Premier Parking Logistics and have started Court Proceedings that I intend to challenge strongly.

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  5. What would be best to respond to the MIL debt purchased, letter before action

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  6. email me prankster@parking-prankster.com

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  7. I have also received a letter saying my parking charge has been sold to MIL, I am disputing the charge on the grounds that there were no light/street lighting working when the car was parked, what would be my next move? Thanks, trish

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    Replies
    1. If it goes to court there are 2 angles of attack.
      1. MILs paperwork was not in order
      2. No proof of contravention from the parkingcompany
      For 1, they usually fail to provide a proper deed between MIL and the operator which shows the number of the parking charge being assigned.

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