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The Credit Services Association (CSA)
Update on the Pre-action Protocol for Debt Claims (PAP)
For the past two years the Credit Services Association (CSA) has been engaging with the Ministry of Justice (MoJ) regarding the Pre-Action Protocol (PAP) for debt claims. The CSA was one of the first voices to push for a formal consultation, and has actively contributed to the debate ever since through responding to the consultation and by the presence of CSA President Leigh Berkley on the sub-committee negotiating the PAP.
The CSA's position was that PAP may end up creating more issues than it solves, and leaving customers more confused about what will happen to them in the courts.
Today (9 December 2016), a sitting of the Civil Procedure Rule Committee (CPRC) delivered their ruling. A joint statement by the CSA and the Civil Court Users Association can be found below.
Joint statement by the Credit Services Association and the Civil Court Users Association
Further to yesterday’s update (8 December 2016), the CPRC meeting was held this morning. The meeting was attended by Leigh Berkley (pictured) and Rob Thompson as industry representatives, and by the Master of the Rolls.
The outcome was as follows:
- The PAP is likely to be implemented next year.
- There will be no requirement for the original agreement to be sent at LBA stage.
- There will be a requirement that creditors make it clear in the LBA itself that the customer has the right to ask for documentation, including the original agreement, although it was accepted that this should not be so prominent as to encourage spurious requests.
- It was agreed that the new Standard Financial Statement will be used as part of the protocol.
- We requested a sufficient implementation period for the necessary systems and process changes to be made by creditors.
- The Committee was mindful of the future impact of the Online Court, and it is hoped that PAP will inform the approach to the introduction of the Online Court.
- The Committee also considered whether this PAP was called for at all, as unusually there has not been an agreed position among stakeholders. On balance, it was decided that it would prove helpful.
- The PAP will now be redrafted and sent back to the sub-committee before the Master of the Rolls decides whether and when it will be implemented.
Both Leigh and Rob had ample opportunity to contribute to the discussions, which both felt were balanced and constructive. We considered that the arguments were understood and fully considered.
Due to the confidentiality of the sub-committee, we are still unable to disclose the full details of the latest draft. There will undoubtedly be some provisions with which creditors or the debt advice sector may not fully agree, however we think we have arrived at the best compromise possible in all the circumstances, and a much better solution for all parties than the original draft PAP.
We will update you as soon as further details of the finalised PAP and the implementation period are agreed.
Leigh Berkley (CSA) and Robert Thompson (CCUA)