Transcripts from House of Lords test case appeal.

[Amethyst]

We now have available for Legal Beagles members the full transcripts from the 3 days of hearings at the House of Lords.

They are quite heavy going, but very interesting and definately worth a read.

The hearing in the House of Lords was held on 23rd, 24th, 25th June 2009 and the purpose is to appeal the Judgments handed down in the High Court by Justice Smith in April 2008 and in the Court of Appeal by the Master of the Rolls in February 2009.

If I can ask that these aren't reproduced outside of the site please. Big thanks to EXC for getting them off Merrill Legal for us. Took a while to get the banks and OFT to agree to make them public.




Some extracts -

MR SUMPTION: Indeed. In this case, you are paying for the
6 convenience of being able to do that which you would not
7 otherwise be entitled to insist on: namely, that
8 transactions go through in spite of the absence of funds
9 and that you be allowed to borrow.
10 LORD MANCE: Actually, you are not, are you? You are really
11 paying to enable banks to operate a sort of reverse
12 Robin Hood exercise. Isn't it subsidising the richer --
13 MR SUMPTION: That is, with respect, tendentious nonsense.
14 LORD MANCE: Tell me why.
15 MR SUMPTION: Looking at it in terms of the contractual
16 relationship with which this regulation is concerned,
17 what you are paying for is the right to do that. What
18 your Lordship is referring to is what the bank does with
19 its revenue stream.
20 Now, that is not simply what your Lordship calls
21 Robin Hood-ery. First of all, it is a cross-subsidy
22 between those parts of the individual customer's charges
23 which are generated at a time when he is in credit, and
24 those when he is not.
25 One should not look at this simply in terms that
37
1 there are two categories of people: people who are
2 permanently in credit and people who are permanently in
3 debit.
4 But the fundamental objection to your Lordship's
5 point is that it is confusing what the charge is levied
6 before as between the customer and the bank and what the
7 customer spends the money on. It would be just as
8 pertinent -- ie, in my submission, not pertinent at
9 all -- to say that we were charging these in order to
10 pay increased dividends to our shareholders; now, of
11 course, an indirect way of subsidising the public purse.
12 LORD MANCE: There must in fact be a lot of cross-subsidy
13 between people who remain in credit. I mean, the larger
14 the amount you have in the bank, the more interest you
15 will forgo and the more, therefore, you are subsidising
16 someone who may remain perfectly in credit but only
17 has £10 in the bank.
18 MR SUMPTION: Cross-subsidy is inherent in almost any
19 complex package of services. It is absolutely
20 fundamental and it is not objectionable.

[Amethyst]

Re: Transcripts and overview from House of Lords test case appeal.

June 23rd 2009

[Amethyst]

Re: Transcripts and overview from House of Lords test case appeal.

June 24th 2009

[Amethyst]

Re: Transcripts and overview from House of Lords test case appeal.

June 25th 2009