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Alex J.
Alex J., Solicitor
Category: Law
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Experience:  Solicitors 2 years plus PQE
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We are disputing a business bank loan we took out on 27-02-2007

Resolved Question:

We are disputing a business bank loan we took out on 27-02-2007 and formally disputed by recorded mail on 26-02-2013 but we did not file a formal complaint yet; can we still proceed (under English Law)? Kind regards, ***** *****
Submitted: 2 years ago.
Category: Law
Expert:  Alex J. replied 2 years ago.
Hi,
Thank you for your question and welcome.
My name is ***** ***** I will assist you.
If the bank loan is still due and owing there is no time limit running when you can complain about that loan.
Are you trying to reclaim interest or claim damages under a breach of the loan document?
Kind regards
AJ
Customer: replied 2 years ago.

Hi Alex,

Thank you for your swift response.

The loan was repaid last year March, under pressure from the bank to re-posses.

Kind regards,

Johannes

Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
What element of the loan are you disputing?
If the cause of action arose in February 2013 - the limitation for making claim would be 6 years from this date.
Was the loan in your name personally or a limited company name?
Kind regards
AJ
Customer: replied 2 years ago.

Hi Alex,

The loan was in the name of a Property Development Partnership and we could argue that the course of action arose in January 2013 when we first became aware of the following discrepancies in the agreement:

1). At the time the Bank forced an investor (not being a Partner) to co-sign the agreement

2). Material Terms and Conditions were not included in the agreement, but put to the Firm at a far later date (well after we had signed)

In our letter dated 26-02-2013 to the Bank we actually mentioned and disputed these issues; could this action be construed as a Formal Complaint?

Kind regards,

Johannes

Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
Yes if you raised this as a complaint in writing to them then they have an obligation as a bank with a banking charter to consider the complaint.
If the causes of the complaint actually arose in January 2013 then you should not be barred from suing under this contract.
I look forward to hearing from you.
Kind regards
AJ
Customer: replied 2 years ago.

Hi Alex,

I feel our best chance lies in our complaint issued by formal letter to the bank on 26-02-2013, although this was not a Formal Complaint...would this still leaves us 'in the race' you think?

The initial cause of the complaint lies way back in February 2007 when we signed the business loan agreement although we only found this out in January 2013... The complaint however was issued within the legal bar limit of 6 six years...just, by one day.

Bold question here: can we legally spoken still proceed or would we be wasting time and money?

Kind regards,

Johannes

Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
What is the actual nature of the complaint?
For a court claim you are seemingly in the time limits.
As for a formal complaint - you made a complaint in writing so this is a formal complaint - whether it is within the banks complaints procedure is irrelevant.
If the loan is under £2million and you are worried about the cost of legal action, I would consider complaining to the Financial Ombudsman www.financial-ombudsman.org.uk/
I look forward to hearing from you.
Kind regards
AJ
Customer: replied 2 years ago.

Hi Alex,

Many thanks for your latest response.

The nature of our complaint revolves around misrepresentation of a business loan agreement and the inaccurate and by times incompetent, negligent, chaotic working practice demonstrated by the Bank over a number of years which has caused a lot of damage to both the Firm and our personal lives.

As for the misrepresentation of the business loan agreement I can highlight three main complaints, as already partly mentioned to you in an earlier mail


1). At the time the Bank forced an investor of ours (not being a Partner) to co-sign the loan agreement


2). Material Loan Terms and Conditions in connection with a property development project we had started in 2007 were not included in the agreement under Preconditions but put to the Firm at a far later date (months after we had signed)

3). Misselling of 3 (expensive) life-assurance policies, which the Bank had forced us (my Partner, our Investor and myself) to take out as part of their Preconditions for the loan to be granted (but, again, not included in the agreement)

As for how to proceed. I feel we should first go back to the Bank and issue them with all the relevant details of our complaint since they so far only have received a general description of the issues on hand.

Once we have received a formal position from the Bank in response to our complaint we can consider further action. The first step then would indeed be referring the case to the Financial Ombudsman before taking further legal action.

But at least we now know that we can still continue suing the Bank (Lloyds Bank, for your information).

Would there be anything else you could advise us at this stage, Alex?

Kind regards,

Johannes

Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
I would only advise that the mis selling off an insurance to someone in their personal is a complaint by itself - it is effectively a whole other issue.
As a starting point for the whole complaint and gathering evidence you should conduct a Subject Access Request and get the bank to ideally deliver up their file on you. https://ico.org.uk/for-organisations/guide-to-data-protection/principle-6-rights/subject-access-request/
What you want to look for is instances where the bank abused its bargaining power to get you to enter into financial products that were not fit for purpose. An example of this would be if they denied you the opportunity to get independent advice or told you you did not need such advice.
I wish you the best of luck. Any feedback is gratefully received.
Kind regards
AJ
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