Consumer Credit Bill

moved Amendment No. 25:"Page 15, line 20, at end insert ““; or" (d)   at the instance of the Official Receiver or the trustee in bankruptcy of a debtor who may also reject in whole or in part the proof of any debt arising from an unfair relationship in the same way as is provided in subsection (1)”” The noble Lord said: In moving amendment No. 25, I shall speak also to Amendment No. 26. Clause 20 gives the court power to intervene when a credit agreement is found to be unfair. It gives the court wide powers to remedy any perceived unfairness. Clause 20(2) provides that the very useful remedies available to the court can only be made on the request of the debtor or a surety. The amendment provides that the Official Receiver or the debtor’s trustee in bankruptcy can also ask the court to intervene in the same way. If a person goes bankrupt, the Official Receiver or his trustee in bankruptcy stands in his shoes under the general law as regards all legal rights and remedies he may have. If the debtor is a bankrupt, he may have no interest or incentive to seek relief from the court as provided in this section. However, there may be other creditors of the bankrupt person who have every interest in getting the unfair debt modified because the less that is owed to the unfair creditor, the more can be shared out among those who have a bona fide debt. There is no reason why an unfair creditor should be relieved from suffering any remedy simply because the debtor has been driven into bankruptcy, possibly as a result of the actions of that creditor. Also, the higher the debt, including any unfair element, the harder it will be for the debtor to make a new start. I feel that the omission of the provision that we are asking for is an oversight and this simple amendment puts it right. Amendment No. 26 deletes new subsection (4) which states that any order under new Section 140B(1) rectifying an unfair agreement shall not affect any judgment. This seems to be contradictory. If the court makes an order under, say, new subsection (1)(a) to repay money, that affects any judgment that the creditor may have obtained, possibly in default of appearance by the debtor. No doubt, the Minister will tell us what the draftsman had in mind. I beg to move.