If you have a Hire Purchase Agreement, Conditional Sale Agreement or a Personal Contract Purchase Plan (PCP) and you go into arrears, your property may be liable to be repossessed.
Where you have paid less than a third of the amount owed under the agreement, the Lender may argue they can repossess the item without a Court Order.
This is a grey area, as the alternative argument, in Scotland, is lenders always require a Court Order to repossess goods. This is because traditionally Scots Law has been averse to lenders using "self-help" remedies to enforce their contractual rights, without your agreement.
If your car, for example, is repossessed at any point without a Court Order you may be entitled to compensation. The arguments for this may be stronger where the property is kept in a garage, driveway or (in the case of non-vehicles) in your home.
Hire Agreements
Like with the above types of agreements, there is also a strong argument that items subject to Hire Agreements cannot be repossessed without your agreement or a Court Order.
Section 132 of the Consumer Credit Act 1974 even provides that where an item is repossessed without a Court Action being raised, the Court may order that all or sum of the installments previously paid, be repaid to the Hirer.
Section 132 Financial Relief for Hirer
(1) Where the owner under a regulated consumer hire agreement recovers possession of goods to which the agreement relates otherwise than by action, the hirer may apply to the court for an order that—
(a) the whole or part of any sum paid by the hirer to the owner in respect of the goods shall be repaid, and
(b) the obligation to pay the whole or part of any sum owed by the hirer to the owner in respect of the goods shall cease,and if it appears to the court just to do so, having regard to the extent of the enjoyment of the goods by the hirer, the court shall grant the application in full or in part.
(2) Where in proceedings relating to a regulated consumer hire agreement the court makes an order for the delivery to the owner of goods to which the agreement relates the court may include in the order the like provision as may be made in an order under subsection (1).
