Bank Charges Ruling Conundrum!!!

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Bank Charges Ruling Conundrum!!!

Postby bustthematrix » Wed Nov 25, 2009 6:15 pm

Hi All

I'm sure many of you are aware of today's bank charges ruling. How amazing that som any of the lower courts could get it soooooooooo wrong!!!! Yeah right!

Anyway, if not, go here http://news.bbc.co.uk/1/hi/business/8376906.stm

Now what puzzles me is the Law Lord's ruling itself. What exactly are they saying? I quote "bank customers agreed to pay overdraft charges as part of the price of having a current account, so they fell outside the scope of the 1999 consumer contract regulations."

How can that be right? If they are not fair and clear do the banks not need to justify them anyway?

And also, why can't the OFT appeal to the European Supreme Court?

Seems like nonsense to me.
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Re: Bank Charges Ruling Conundrum!!!

Postby BaldBeardyDude » Wed Nov 25, 2009 6:31 pm

The report is quite biased (it is the BBC after all :giggle: ) If you read into it, it is a quite narrow area on which the judge ruled. The OFT can use other means at it's disposal to check the fairness of the charges. It is a setback, not a defeat.

When you open an account, you sign the form they give you? That is the one spelling out in the terms and conditions, exactly what they can do with your money......did ya read it? I didn't and I was royally screwed. I read my new ones so there would be no surprises.

I think it rather one avenue blocked off, but many left yet to try, so don't be downbeat. There is still plenty of scope for cases and refunds.
They must find it hard to take Truth for authority who have so long mistaken Authority for Truth - Gerald Massey
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Re: Bank Charges Ruling Conundrum!!!

Postby Freeman-B » Wed Nov 25, 2009 6:54 pm

When the bankers = the Crown = the "Courts" this is to be expected.

Unfortunately, they have all been so fraudulent and downright criminal that we WILL find a way to bring them down.....one step at at time, eh?

The fact is they are scum and they know it - the only issue is that Joe Bloggs doesn't (despite being given MANY heavy hints), however, one day he will wake up and God heal the gits then.

By the way, I hear the Oxford Dictionary agreed on a new colletive noun for bankers - a WUNCH (as in a Wunch of Bankers)! Seems poetic!

:peace: :love:
B
He who joyfully marches to music in rank and file has already earned my contempt. He has been given a large brain by mistake, since for him the spinal cord would suffice. Einstein
Banking doesn’t “involve” fraud...banking IS fraud. Tim Madden
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Re: Bank Charges Ruling Conundrum!!!

Postby gepisar » Wed Nov 25, 2009 7:13 pm

There is of course an answer.

During one of my previous lives, I looked into setting up my own bank... anyone got FIVE million for a security bond?
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Re: Bank Charges Ruling Conundrum!!!

Postby BaldBeardyDude » Wed Nov 25, 2009 7:24 pm

gepisar wrote:There is of course an answer.

During one of my previous lives, I looked into setting up my own bank... anyone got FIVE million for a security bond?


Would this promissory note do? :saint:
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Re: Bank Charges Ruling Conundrum!!!

Postby gepisar » Wed Nov 25, 2009 8:13 pm

BaldBeardyDude wrote:
gepisar wrote:There is of course an answer.

During one of my previous lives, I looked into setting up my own bank... anyone got FIVE million for a security bond?


Would this promissory note do? :saint:

Not unless you REALLY mean it... :wink:
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Re: Bank Charges Ruling Conundrum!!!

Postby BaldBeardyDude » Wed Nov 25, 2009 8:21 pm

Hell, if it gets me half my own bank, I'll double it, dude! :grin:

The Common Law bank - awesome! :mrgreen:
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Re: Bank Charges Ruling Conundrum!!!

Postby bustthematrix » Thu Nov 26, 2009 10:18 pm

Hi Folks

Some interesting information on this topic from someone on the frontlines. Quite heavy on Statutes etc...but you know, it's about having and using 'the right tools for the right job'. One size definitely does not fit all.

From: penaltycharges.co.uk
Subject: Supreme Court Judgment and what is means,
Date: Thursday, 26 November, 2009

Supreme Court Judgment and what it means,
Well I have just got back from London where I spent a lot of time trying to put right the media stories that the Bank’s had won and this was the end for consumers, gladly I note that most of the Media have now reported that this case was not as important as many people thought is was:

I am going to set out parts of the Judgment and explain what they mean if needed. After which I will outline what I think should happen next.

The Judgment

Firstly the Lord Walker highlighted the fact that many members of the public were not aware of the limited nature of the issue, which the court had to decide in the appeal.

At Para 45 Lord Walker Said “…The Directive and the 1999 Regulations apply only to terms which have not been individually negotiated“. Clearly the contract we all entered into with the banks has not been individually negotiated so the regulations do apply.

Lord Philips Para 57. Stated the issue is whether the relevant charges constitute “the price or Remuneration, as against the services supplied in exchange” within the meaning of the Regulation. If they do not, the attack on the fairness of the term that is open to the OFT will not be circumscribed (restricted) by Regulation 6(2)b. If they do, then they will still be open to attack by the OFT on the ground that they are “Unfair” as defined by regulation 5(1) but that attack cannot be founded on an allegation that the Relevant Charges are excessive by comparison with the services which they Purchase, for that is forbidden by regulation 6(2)b

So what does this mean, well it means that the Court has ruled that the charges for bounced direct debits and unauthorised overdrafts etc are part of the price for the services, therefore they cannot be tested for fairness under Regulation 6(2)b of The Unfair Terms in Consumer Contract Regulations 1999, However the Court has said that the OFT can assess the Fairness of the price under Regulation 5.1. According to other criteria. (See Para 59)

This point is further explained in Para 80. Lord Philips states ‘it seems to me that this reasoning is relevant not to the question of whether the Relevant Charges form Part of the price or remuneration for the package of the services provided but to whether the method of pricing is fair. (My emphasis added) It may be open to question whether it is fair to subsidise some customers by levies on others who experience contingencies that they did not for see when entering into their contracts. If not it may then be open to question whether the Relevant Terms fall within Regulation 5(1)….” Clearly his lordship highlighted that the court may be persuaded that it is unfair for some consumer to pay for services that other consumers benefit from for free.
What’s more it is mostly the consumers who are on low incomes and struggling financially that are paying for everyone else. This is in my opinion not fair, and shows the banks have not acted in “Good faith”. Or as Lord Mance’s suggested in the trial, that ‘the banks were engaged in a sort of Robin Hood in reverse’ (see Para 2) I would suggest he means the banks were taking from the poor to subsidise the rich.

All the Lords appear to have agreed with Lord Walkers final Paragraph that being 52, in which he said ‘…This decision is not the end of the matter’, as Lord Philips explains in his judgment. Moreover Ministers and Parliament may wish to consider this matter further. They decided in an era of so-called “light-touch” regulation, to transpose the directive as it stood rather that to confer the higher degree of consumer protection afforded by the national laws of some other member states. Parliament may wish to consider whether to revisit that decision.’

So what does all this mean, well it means the following

1. The OFT can still look at the charges under UTCCR 1999, and always has been able to. They could now launch a new test case. (However, what must be asked is why was there a two year test case on a very narrow point of law? when the OFT already had the ability to assess the fairness of theses charges under Regulation 5.1 and others )

2. All consumers who have submitted a claim using the Old Particulars of Claim, arguing that the price was unfair and or that these are a penalty charges. Needs to amend their claim to include an argument under regulation 5.1. (a new Particulars of claim will be live on the site tomorrow with full instructions on what you need to do)

3. We also need to put pressure on the Government to amend the Regulation so we all have the same consumer protection rights that other member states have. (So get writing to your MP’s a template letter for this will be on the site within 48 hours)

4. I am sorry to say but I would like to see the stay remain in place, for a least a month. This will give consumers time to amend their claims and other consumer groups and I will be discussing the possibility of joining forces to bring a joint Class action. I feel this would insure that we could make sure that all the legal arguments are covered in full. I will update you all on this when I have spoken to the other consumer forums.


Finally, I will explain Regulation 5(1) in more detail on the site for those that are interested. However, what was important in this news letter is to confirm that this was basically a set back to the OFT and not to consumers. Claims can still be filed.

The FSA has also lifted the Wavier.

I hope that the OFT if they do decided to bring a new action, that they will now invite the consumer groups to the table. Something we asked them to do before this test case, sadly that request was refused.

To conclude, the test case has only resulted in us having to amend the Particulars Of Claim and resulted in a two year delay, other than that we are back to the position we were in two years ago.

So was this test case a victory for the Banks, yes they beat the OFT on a small point of law, they did not beat the consumer forums and or the consumers.
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