There was no attempt on record to challenge the pursuers averments thereanent. It sent us this statement: We are sorry to hear that our customer, who took a loan out with us in 2006, was unhappy in her experience. Mr Morgan also produced the paper part of the driving licences of himself and his wife and two utility bills, one each in the name of himself and Mrs Morgan, which Ms Sinclair considered satisfactory identification. This was a 25-year loan Charles was 52 when she took it out and the rate has moved up and down. The details of the tenancy were in fact provided by Mr Morgan and sent to Mellicks under cover of a letter dated 4 November. [98] BM Solicitors, on the other hand, were a firm providing professional services and, as such, would not normally be expected to do more than carry out those services with reasonable professional skill and care [99] In the present case, BM Solicitors were almost certainly instructed by the self same impostor as had been dealing directly with Excel itself. He did not accept that the discrepancies in the figures were merely mistakes. Call urgently as time is running out for customers to claim as it can be no longer than 6 years from when you paid your loan off to claim. [20] On 2 November Ms Sinclair responded to Messrs Mellicks letter of 29 September by sending the extract title deeds to them to enable them to prepare the draft standard security. You're using Internet Explorer, some features might not work. Necessary cookies are absolutely essential for the website to function properly. Mr Longmuir asked for identification documents to be produced. He also seemed to have placed weight upon the fact that the figure of 160,000 equated to the figure specified in a Market Appraisal dated 13 August 2009 prepared on behalf of Aberdein Considine. [8] Mr Allison criticised the sheriffs approach to interest on two levels. [12] Under reference to the second ground of appeal for the defenders, Ms Hamilton made much of the significance of comparables in the context of Mr Dougans evidence. In each case the respondents have been the victims of mortgage fraud. They were living at 30 Guthrie Court, Auchterarder to which all correspondence should be sent. The case has been quoted in an number of legal commentaries including Lexis, Practical Law and Civil Litigation Brief. Professional lenders were seeking to recover from a firm of solicitors their losses resulting from identity fraud by borrowers for whom the solicitors had acted in preparing security documents over property of which the borrowers claimed they were the true owners. Furthermore, he was almost certainly the person with whom Excel itself had been dealing on the basis of the same misapprehension as to his name and identity. I enclose a separate letter of instruction in this regard signed by myself and my wife". The saga began in 2006, when Charles and her husband were looking to buy a house in Epsom, Surrey. The case went to County Court. Legal - General; Statutes and . In Elias & anor v Blemain Finance HHJ Keyser QC gave helpful guidance on the application of the allocation guidelines for the county court at CPR 26.7 & 26.8. Birmingham City Council v Forde [2009] EWHC 12 (QB) (13 January 2009) Birmingham City Council v Gaston [2004] EWCA Civ 693 (20 May 2004) Birmingham Midshires Building Society v. Infields (a firm) [1999] EWHC Technology 232 (20th May, 1999) Birmingham Midshires Building Society v. Significantly the reclaimers accepted that in each case the security transaction had been conducted according to normal good practice. However, the terms of that judgment are recorded in his Note dated 1 July 2014. Blemain Finance - Consumer Action Group Library Activity More All Activity Home Banks, Loans & Credit Other Institutions Blemain Finance 21 hours ago Sunday at 19:34 Twitter - Include the @company's twitter name in your post title - here's why Are you going to pay your builder or your second-hand car dealer in cash or with a bank transfer? The Court should be slow to allocate to a track normally associated with a lower value. [13] On 26 November Messrs Mellicks wrote to Longmuir & Co enclosing the formal offer of loan together with the acceptance form which required to be signed and returned to them along with the standard security document and the standing order mandate. It is sufficient to highlight certain of these matters for the purposes of disposing of these reclaiming motions. On the next day, 3 December, they forwarded to Messrs Mellicks the letter of obligation dated 2 December together with extracts of a disposition and discharge "in our clients favour" these being the title deeds already shown to Mellicks under cover of their letter of 17 November. At the beginning she says the interest rate was 13.9%, and the court documents say it went up to 14.9% at one point. The interest rate will now be fixed at 11.45%, and Blemain must pay 75% of the legal costs that Charles incurred. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc. There was also a letter of obligation in the Blemain case. The following year a suspended possession order was made but the arrears on her account were paid, so it wasnt activated. The report stated that the property had been inspected on 2 November and the valuation was in the sum of 600,000. The cookie is used to store the user consent for the cookies in the category "Analytics". It was in more or less the usual terms as follows: With reference to the settlement of the above transaction today, we hereby undertake to clear the records of any deed, decree or diligence (other than such as may be created by or against your clients) which may be recorded in the Property or Personal Registers or to which effect may be given in the Land Register in the period from the date of certification of the latest Form 10, 11, 12 or 13 (which is appropriate) exhibited to you until fourteen days from this date inclusive (or to the earlier date of registration of the purchasers' interest in the subjects) which would cause the Keeper to make any entry on, or qualify his indemnity in the Land Certificate to be issued in respect of the interest.". Reference was also made in Judge Hegarty's judgment to the case of Bristol and West Building Society v Fancy and Jackson [1997] 4 All ER 582, Bowstead and Reynolds particularly at para 9-065, SEB Trygg and a number of other English authorities. His, is there any update on this. On 26 November Messrs Mellicks confirmed receipt of the documents including the standard security and confirmed that the funds had been transferred to Balfour and Manson. The case pitted Charles, a. The fact of entering into the transaction with the professed agent, as such, is good consideration for the promise.". We use cookies to ensure that we give you the best experience on our website. This page was generated at 16:20:PM. The sheriff principal, having resumed consideration of the pursuer's appeal and the defenders' cross-appeal, refuses the latter and in respect of the former allows same in part; varies the. She also described being bombarded with letters and phone calls about the arrears. The first letter was accompanied with certain documents signed by Mr and Mrs Cheetham. The judgment raises issues that could affect thousands of people, and is likely to be studied closely by other borrowers, including customers of other subprime lenders. The pursuers and reclaimers in both cases belong to the same group of companies known as the Blemain Group. In the BFL case Messrs Balfour & Manson were instructed by the borrowers to prepare the appropriate standard security, in favour of BFL Both firms of solicitors then engaged with Messrs Mellicks Solicitors, acting for the lenders, in relation to the execution of the standard securities. Since no such land certificate had been delivered, the defender was in breach of that obligation and bound to compensate the pursuers for their resultant loss. The Commission brings enforcement suits in U.S. District Courts when matters are not satisfactorily resolved through the administrative enforcement process and sues to enforce administrative subpoenas. The figure of 600,000 was noted by him in brackets on the form. The cookie is used to store the user consent for the cookies in the category "Performance". [10] On 25 November 2004 Mellicks wrote to CMC in the following terms: We write to advise that we have will (sic) receive the Credit Agreement signed by Mr & Mrs Cheetham the Standard Security duly signed together with a Standing Order Mandate on Friday 26th November 2004. The surveyors report also indicates that alterations have been made to the property and we should be pleased to receive the appropriate building warrants and completion certificates. [14] In relation to the first ground of appeal for the pursuer, I am not satisfied that the sheriff erred in arriving at the figure of 160,000. [3] The sheriff had issued an ex tempore judgment. Vat no: 294 8327 19Authorised and regulated by theSolicitors Regulation Authority-Stephensons Solicitors LLP - No. StephensonsSolicitors LLP won the County Court case for Mrs Thomas fromPenzance, who had taken out five secured loans over her property between September 2004 and January 2008 with creditor,BlemainFinance. What followed thereafter was what would routinely be expected to follow in a secured loan agreement of the sort in question. On 1 November, the day before signing the acceptance of the offer letter, the fraudsters, again representing themselves as Mr and Mrs Cheetham, wrote to CMC on writing paper headed with the address 34 Danube Street, Edinburgh to confirm that the monthly payments in the respect of the loan were affordable by them. Your choice regarding cookies on this site, Succession & estate planning for business owners, Partnership agreements & limited liability partnerships, Directive on security & network information systems, Privacy & electronic communications regulations, Claims against HM Courts & Tribunal Services, Care home fees and planning for the future. 3. The point is incapable of much further elaboration.". The frauds perpetrated upon them as a result of fraudsters, each of the reclaimers involved two different pairs of individuals applying for a loan, pretending to be husband and wife who were owners of heritable property which was to institute the security for the loans. In considering whether or to what extent interest should be awarded on the damages figure, I am, at best, doubtful that the court is entitled to consider arrangements which may or may not have been made in regard to the charging of interest on a discrete sum of money which is distinct from the award made by the court. The case was re-allocated to the fast track. Although the implied warranty of authority in agency, as enunciated in the case of Collen was of English origin it was adopted into the law of Scotland like many of the other instances of judicial legislation in commercial matters just referred to. If you would like to opt in, or out, of receiving news and marketing from LegalBeagles Group Ltd you can amend your settings at any time here. The court held that the warranty given by a solicitor, when conducting proceedings, was that he had a client who had instructed him to assert or deny the claims made against the opposing party. 165. The pursuer having suffered loss as a result of Longmuir & Co's breach of representation as to their authority et separatim as a result of the breach of the Letter of Obligation by Longmuir & Co, is entitled to reparation therefor. It shows that the courts will not allow creditors to impose unfair terms and conditions on consumers, and where such terms are used, the courts will not hesitate in striking those terms from the contracts.. The Defendant says that rescission as a remedy is fanciful in this case, that the Court will have to look at all the circumstances, that the borrowing was actually used for consolidation of other loans and that in reality what the Court will be doing is looking at an appropriate remedy probably of damages based on commission and charges most likely in the region of around 2,500. The reclaimers in each action now reclaim against those decisions of the Lord Ordinary. In both cases the couple, who turned out to be fraudsters, executed pretended standard securities over the heritable properties which they claimed they owned. As can be seen below, in the context of litigation, the warranty is similarly limited in that the agent (normally a solicitor) does not promise that a claim is valid". Firstly, under reference to paragraph [9] in the sheriffs Note, having explicitly precluded consideration of the shortfall for the purposes of determining the principal sum due to the pursuer, the sheriff then decided that the existence of the shortfall, [9] Secondly, Mr Allison stressed that the defenders pleadings were silent both as to, [10] Ground of appeal 3 was a development of the main theme inherent in ground of appeal 2, viz. Please be aware that we would never ask for money upfront, and we do not provide unsecured loans. The cookies is used to store the user consent for the cookies in the category "Necessary". She took out the loans for home improvements, debt consolidation and to purchase a car, with the amounts borrowed each time ranging from 5,000 to 10,000. . These cookies ensure basic functionalities and security features of the website, anonymously. The reclaimers' sole complaint was that the borrowers, having turned out not to be the owners of the subjects over which the reclaimers wished to have security for their lendings the respondents were in breach of their respective implied warranty of authority. Im 66 and into my retirement I didnt expect to be in this position of still owing this debt. We were advised that commercial lenders, like those involved in the proceedings before us, are not infrequently being made the victims of identity fraud. [15] In this case the borrowers were fraudsters who claimed to be Mr Geoffrey Ellison Morgan and Mrs Margo Clark Morgan. (See paragraph[18] in Wilson). In other words, the defenders, through MsHamilton, maintained that when the shortfall amount was taken into account there was, in any event, no loss and that the sheriff had, once again, erred in that regard. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); We use cookies on our website to give you the most relevant experience by remembering your preferences and repeat visits. Please revert this information back to us.". Together Personal Finance Limited is a member of the FLA. Charles has so far paid back a total of almost 60,000 in interest, and there is still an outstanding debt of almost 45,000, even after the deduction. Superior Court. Charles said it was the broker who suggested those words be put down in order to help get the loan through easier. We accept that a warranty may be given by a solicitor, or other agent, expressly to a third party as to a particular attribute or attributes of the solicitor's or agent's client. 30101 et seq. A woman has had three loans, which were secured against her home, written off thanks to a leading North West law firm, giving renewed hope to thousands of others facing a daily debt nightmare. The respondents in the action at the instance of Blemain Finance Limited ("BFL") are Balfour & Manson LLP a firm of solicitors who acted in a security transaction with which the action at BFL's instance is concerned. All information will be held in accordance with data protection requirements. His decision is the subject of an appeal by the pursuer and a cross-appeal on behalf of the defenders. On 11 November Ms Sinclair wrote to Mr and Mrs Morgan asking them to come to her office to sign the standard security and other documents. Ms Hamilton, for the defenders, argued that the absence of evidence regarding what particular steps ought reasonably to have been taken by the defenders meant that there had been insufficient evidence before the sheriff to enable him to conclude that the defenders were in breach of the statutory provision in section 25 supra. These documents, the Lord Ordinary held, must have come to BFL in the first place from Mr and Mrs Morgan. We remind ourselves that Collen v Wright has been held to be the leading authority in this area in the law of Scotland for more than 150 years. Nothing is disclosed that would adversely affect your security". Mr Morgan explained that they required the loan in order to buy property in Spain and requested that the funds be paid direct to parties in Spain. However, that particular error was not relied upon by the defenders as a defence to the claim for failure to implement the letter. To pay the deposit on the new property, she borrowed from Blemain via an interest-only loan secured on her flat. I do not consider that they gave any implied warranty going beyond this". The Criminal Division is administratively divided into four branches: Case Management, Special Proceedings, Quality Assurance, and Courtroom Support. The claimants appealed the decision to allocate the matter to the small claims track. [10] Ground of appeal 3 was a development of the main theme inherent in ground of appeal 2, viz. The purpose of the loan was said "to assist the purchase of overseas property". That was a person identifying himself by the name of James Charles Whittaker Golding and claiming to be the registered proprietor of the property at 17 Richards Place. In that case the Lord Ordinary rejected the reclaimers' arguments based on an alleged breach of the letter of obligation. My reluctance to interfere with the sheriffs decision when it comes to the pursuers first ground of appeal is fortified by Lord Reeds reference in the case of Liquidator of Letham Grange Development Co Ltd v Foxworth Investments Ltd & Another 2014 SLT 775 to the principles governing the review of findings of fact by appellate courts and to the earlier decision of McGraddie v McGraddie 2013 SLT 1212. Christmas party season prompts drink-drive warning following 239% increase in arrests. [23] The Lord Ordinary proceeded to absolve both sets of respondents from the conclusions of the summons in each case. Solicitor marks a decade of service helping bereaved families. I do not accept the proposition that there was no evidential basis for that figure. But the risks against which Excel is seeking to be protected in these proceedings are the commercial risks involved in lending to a person who may not be all that he claims to be. [32] Insofar as the reclaimers position was to argue that, under the existing law there could be an implied warranty of authority, in respect of what they called "the identity" of the agent's client, we have already commented on the appropriateness of the use of the word "identity" in this context. They also returned the draft letter of obligation drafted by Longmuir & Company. [17] In due course, some time in late September 2004, Balfour and Manson solicitors obtained instructions to act on behalf of Mr and Mrs Morgan. He confirmed that they had requisitioned copies of the prior title deeds. And when they applied in February 2009 to Blemain Finance Ltd for a loan, Mr Cordner said that his income was 21,000.that pre-funding was necessary in order to finance the construction of the development, but Mr Clarke added that had Mr Hone told him, Mr Clarke, to ask for the whole of the purchase price up front.within his own resources or proposed to raise it through other sources of finance. She stressed the absence of evidence from a marketing expert as to which other steps the defenders might reasonably have taken. The sheriff records therein that, to some extent, he was influenced by the evidence given by John Dougan, chartered surveyor. We look forward to hearing from you. The judgment raises issues that could affect thousands of people, and is likely to be studied closely by other borrowers, including customers of other subprime lenders. It was a term of the mortgage offer that the loan be secured by a first mortgage over the property in the form of the draft standard security accompanying the offer. Messrs Mellicks, who had been informed that Balfour and Manson were acting for Mr and Mrs Morgan, wrote to Ms Sinclair on 29 September giving details of the proposed loan and requesting details of the title and the short assured tenancy which they understood was in place in relation to it. 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