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LCL UPDATE 23/01/21

LOAN CHARGE LEGAL – INJUNCTIVE RELIEF


Important and urgent update for all LCL members – please read


This update is also being sent via email, so that you have as much time as possible to respond before the deadline of 31 January 2021.


We write this update to ascertain who wishes to be a claimant in our prospective judicial review application.


During the setting up of Loan Charge Legal's case with RPC, it was noted that, as a result of the timescales involved, many of you would be required to make regular payments to HMRC in the form of a Time To Pay (TTP) agreement, in respect of your Loan Charge/DR liabilities. It was considered that these payments would eventually be repaid by HMRC if our case was successful and the Loan Charge was revised further.


RPC confirmed that, once the case was underway, it would be possible to apply for Injunctive Relief (IR). This would mean the court could decide, on persuasive evidence of hardship being presented to it, to order HMRC to halt all payment collections until the case has been decided. Please note that IR will only be possible for named claimants in the judicial review.


Applying for IR would be additional work, undertaken by RPC, at the request and on behalf of, named claimants.


Following the issuance of our Pre-Action Protocol letter, which was sent to HMT on Friday 15 January 2021, we will soon be in a position to apply for IR on behalf of named claimants. This update is to communicate the timelines involved, the potential benefits, who can apply, and the process involved to become a claimant and apply for IR.


Please read the information below carefully and take time to understand it fully.


If IR is obtained it will apply to named claimants in the judicial review case only.


Only claimants are eligible for IR and as claimants are also named on the case, they are inherently therefore liable for costs in the event the case is unsuccessful.

In the sole circumstance of a loss to our claim, any funds that are left over after the case has finished will be used to reduce any liability arisen from adverse costs which will become due to HMT. However, all claimants named on the case will be individually responsible for an equal share of any outstanding costs that remain thereafter.

To support mitigation planning in relation to this adverse cost risk, we are working with RPC to ascertain a recommended claimant risk fund. This fund will be held in escrow by RPC and drawn down in the event of a loss to the case, where there are insufficient funds to cover these adverse costs. Once this recommended level of funding is determined, we will then require claimants to send an amount of money to be held as part of this risk fund.

Please be aware that we are not asking for contributions to this risk fund at this time. We will follow up in due course with those interested in becoming a claimant to discuss this issue further. The amount of any such contribution will be calculated and notified once the number of claimants has been finalised.

Who can apply for IR?


All those who have signed up and have made a financial donation to Loan Charge Legal can be included in the claimant list if they so wish.


If you are a member but have not donated, then you will be able to add your name to the claimant list if you donate a minimum of £250 to the LCL fund. This is the average amount donated and will ensure fairness among members who have already contributed.


Please note that IR is primarily only relevant to those that would suffer hardship if they were forced to pay the Loan Charge.


Who should NOT be a claimant?


If you have settled with HMRC and are wishing to become a claimant in order to get IR against your settlement repayments, it is important to note that the IR application is for Loan Charge payments only, not settlement, so it is unlikely that it would apply to you. However, please do talk to a tax advisor as LCL are not qualified to give tax advice. If your signed settlement terms with HMRC state that you will be in breach of contract if you are involved in litigation, then you should not put your name forward as a claimant.


Becoming a claimant in the judicial review claim


If you wish to become a claimant, you formally agree that the sole channel of communication with RPC will be through LCL and that you will not attempt to contact RPC directly. Any queries which you may have must be directed to LCL who will then contact RPC should that be necessary. Such a system has been put in place as you are benefitting from economies of scale which ensure that the cost to individual claimants is a small fraction of the cost which they would ordinarily pay if they were to instruct RPC directly, on an individual basis, to bring a judicial review claim. There are too many people for RPC to engage with directly. If the above protocol is not strictly observed, the overall cost of the judicial review will increase substantially and further requests for donations will become necessary. Any breach of these terms may result in immediate removal of the claimant from the IR application at the discretion of LCL.


If you wish to be a claimant in the judicial review claim, and therefore be eligible to apply for IR, please complete the form which can be accessed by clicking on the link at the end of this communication and send the completed form back to us as soon as possible and in any event by no later than 17.00 on 31 January 2021.


Anyone who does not complete the form by this date will not be included in the named claimants list. If you do not wish to be a claimant then you do not need to respond to this email.


Having read and understood the above, please click on the link below ONLY if you wish to become a claimant in the judicial review claim using the same email address you used to sign up to the website.


APPLICATION TO BECOME A CLAIMANT IN LCL


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