Carrasco v Johnson, Court of Appeal - Civil Division, February 02, 2018, [2018] EWCA Civ 87

Resolution Date:February 02, 2018
Issuing Organization:Civil Division
Actores:Carrasco v Johnson
 
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Case No: B2/2016/1923

Neutral Citation Number: [2018] EWCA Civ 87

IN THE COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE COUNTY COURT

AT CENTRAL LONDON

District Judge Langley

Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 02/02/2018

Before :

LORD JUSTICE KITCHIN

and

LORD JUSTICE HAMBLEN

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Between :

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Stuart Hornett (instructed by MPR Solicitors LLP) for the Appellant

The Respondent, Ms Rebecca Johnson, appeared in person and was not represented

Hearing date : 24 January 2018

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JudgmentLORD JUSTICE HAMBLEN :

Introduction

  1. This is an appeal against the award of statutory interest made by District Judge Langley in a judgment dated 20 April 2016.

  2. The judge found that the Appellant was entitled to judgment for a total of £39,970.84, made up of a principal sum of £28,500, contractual interest of £6,000, and statutory interest of £5,470.84, awarded at the rate of 3% per annum.

  3. The Appellant contends that the judge exercised her discretion wrongly when awarding statutory interest at the rate of only 3% per annum.

    Factual background

  4. The action concerned a claim by the Appellant to recover the balance of two unsecured loans made by her to the Respondent on 7 November 2008 and 18 December 2008, each of £20,000.

  5. The judge found that both loans were made on the same terms, namely that they would be repaid in two months with interest of £3,000 and that, in the event of default, the loans would also attract £2,000 monthly interest. Shortly before trial the Appellant abandoned her claim for contractual default interest.

  6. The Respondent did not repay either the principal or the contractual interest on time, but made only repayments in 2009, totalling £11,500. This left the principal sum of £28,500 and £6,000 interest outstanding. Proceedings were commenced in May 2010 and on 21 January 2011 the Appellant obtained an order for an interim payment for £28,500, which the Respondent did not comply with. A series of interim charging orders were then made against four properties owned by the Respondent, but no further payment was forthcoming.

  7. Thereafter the proceedings were essentially dormant until the Appellant applied to restore the case in April 2014.

  8. The Respondent raised various defences to the claim, namely that the agreements were unenforceable and the loans irrecoverable under s.40 of the Consumer Credit Act 1974 (``CCA'') because the Appellant was an unlicensed money lender within the meaning of s.41(1); that there was an unfair relationship between the parties within the meaning of s.140A of the CCA so that the obligations under the agreements should be varied or discharged under s.140B, and that if, which was disputed, the £3,000 contractual interest was agreed, it was void as a penalty. These defences were rejected by the judge.

  9. A further defence raised was that the loans contravened s.93 of the CCA because the default rate was set at a higher level than the term rate. It was...

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