LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

[enaid]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

And it reached the Daily Star


Victory for the broke! Crippling overdraft charges case could spark £1bn bank payout


GOOD news for students and those in debt – excessive overdraft fees may become a thing of the past after a landmark court victory over a top bank.
By Nathan Blades / Published 22nd September 2014

BREAKTHROUGH: Oliver Foster-Burnell's court battle against Lloyds Bank could help those in overdraft debt across the UK [TWITTER]
Banks with terms and conditions that pile on crippling fees could find themselves having to pay back an estimated £1 billion to overdraft-suffering customers by next year — perfect for those with student loan woes.
The change began to take place after Oliver Foster-Burnell, 28, won a case against Lloyds Bank for hitting his account with steeply rising fees that pushed him into a spiral of debt.
Charged with over £700 in fees, the public health worker was unable to pay other bills... which pushed him even further into the red.

“It is unfair the banking industry is allowed to profit while people suffer financial hardship”
Oliver Foster-Burnell

However, a judge at Taunton County Court ruled that the bank's terms and conditions were significantly imbalanced and a detriment to Oliver, ordering Lloyds Bank to reimburse him £743 in charges – plus interest.
This is the first time a customer has triumphed over a bank's unfair charges since 2009, when it was deemed banks couldn't be challenged over fee refunds.
Though the court ruling only applies to Oliver's case at the moment, he and his solicitor, Howlett Clarke, are appealing for certain fee terms and conditions from banks to be considered unfair for everyone.
If they are successful, banks could be facing a billion-pound payout to customers claiming refunds.
Oliver, from Taunton, said: "It is unfair the banking industry is allowed to profit while people suffer financial hardship."By applying these charges and allowing them to snowball out of control, it skews the imbalance.
"We want the court to consider that such a system of charges can hit anyone badly — not just those in hardship — and is therefore unfair and needs to be changed."
The ruling is not expected until next year, so Oliver's case is not yet a legal precedent, though judges can use the case as guidance in their decisions.

http://www.dailystar.co.uk/news/late...nd-bank-payout

[dogtired]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

Well done!

[ncf355]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

Thanks EXC,

Not 100% accurate but close enough.

Good to hear they've started to pay out Oli



Well done to you and all concerned for continuing to take this fight through the courts, and many thanks from all of us that you could end up helping

[orfoster]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

Thanks EXC,

Not 100% accurate but close enough.

[EXC]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

http://www.dailymail.co.uk/news/arti...raft-fees.html


Victory over bank charges could open payout floodgates: Court backs customer over hefty overdraft fees

• Oliver Foster-Burnell was charged fees and penalties of more than £700
• Lloyds Bank continued adding £20-a-day on the debt crippling his finances
• A judge ordered Lloyds Bank to refund the money after a court hearing

A landmark court victory against Lloyds Bank over unfair overdraft charges could open the floodgates for a billion-pound payout to customers.

A judge at Taunton County Court ruled that the bank was wrong to hit Oliver Foster-Burnell’s bank account with hefty rising fees that drove him ever deeper into debt.

Penalties totalling more than £700 made it impossible for the 28-year-old public health sector worker to pay other bills – and triggered a spiral of debt that paralysed his finances.



Only after the loyal Lloyds customer hired a debt management company did the bank stop imposing charges of up to £20 a day. In his ruling, Deputy District Judge Stockdale said the bank’s terms and conditions caused a ‘significant imbalance … to the detriment’ of Mr Foster-Burnell. He ordered the bank to reimburse £743 in charges plus interest.

It was the first known legal victory for a customer on the fairness of charges since banks won a hearing over the legality of the fees in the Supreme Court five years ago. That ruling, on a technicality, dashed the hopes of millions trying to claim fee refunds. In the run-up to the 2009 case, bank customers, led by Money Mail’s Fair Play on Charges campaign, reclaimed millions of pounds.

But the Supreme Court decision meant customers could no longer challenge their bank.

Outraged at how severely the penalties pushed him into debt, Mr Foster-Burnell learned of a recent European Court of Justice ruling. This says that any charges increased within an agreement must be clearly explained, including an explanation of how they were worked out.

With help from solicitor Howlett Clarke, Mr Foster-Burnell showed how individual clauses within Lloyds’ terms and conditions failed to do this. The judge at Taunton County Court in Somerset agreed. But, critically, Judge Stockwell said the judgment applied only to the claimant.

Mr Foster-Burnell appealed against this part of the ruling. Last week, he went back to court to ask it to rule that the Lloyds clauses relating to account charges are themselves unfair – not just in relation to his case. If the court agrees, it would apply to all bank customers, leaving banks open to huge payouts.

Mr Foster-Burnell, 28, from Taunton, said: ‘It is unfair the banking industry is allowed to profit while people suffer financial hardship. By applying these charges, and allowing them to snowball out of control, it skews the imbalance.

‘We want the court to consider that such a system of charges can hit anyone badly – not just those in hardship – and is therefore unfair, and needs to be changed.’

A ruling is not expected until later this year. Until then, the county court ruling is not a legal precedent. However, judges can use it for guidance.

Marc Gander, founder of the Consumer Action Group, hailed the judgment as a boost for consumers. ‘These extortionate charges are hugely unfair and it is absurd that the present law merely says courts must turn a blind eye to this issue,’ he said. ‘It’s about time bank customers got the fair treatment that they are entitled to by law.’

Martin Lewis, founder of the Moneysavingexpert website, called Mr Foster-Burnell a pioneer. ‘It’s up to the court to decide if such a term can be unfair to all – regardless of whether they’re struggling in financial hardship,’ he said. ‘Potentially, we’re talking billions of pound.’

Money Mail first sounded the alarm on charges in 2005 when some banks began to raise fees for unauthorised overdrafts.
The Fair Play on Charges campaign created a template letter for customers to help them reclaim the penalty fees. By July 2007, more than £800million had been paid out by banks and the OFT stepped in to try to resolve the situation for all customers.

Although it scored early victories, the Supreme Court eventually ruled that the fees were part of a bank’s ‘core costs’ of providing a current account – and, on a technicality, couldn’t be assessed under rules on fairness.

A spokesman for Lloyds Banking Group said: ‘We do not discuss individual customer cases and any decision will be specific to its facts. However, the legal issues relating to bank charges were dealt with comprehensively and conclusively by the judgment of the Supreme Court.’

[FlamingParrot]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

Confirming Lloyds have paid the full amount today by cheque signed by their "Debt Collection Expenses Account" of £1771xx but doesn't include court fees at this stage.

:whoo::clap2::whoo::clap2::whoo::clap2::whoo:

CONGRATULATIONS ORFOSTER!

:cheer2::cheer2::cheer2:

[EXC]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

Nice one.

[orfoster]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

Confirming Lloyds have paid the full amount today by cheque signed by their "Debt Collection Expenses Account" of £1771xx but doesn't include court fees at this stage.

[righty]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

Importantly the Regulations do not operate by precluding
reliance on the contractual term in cases where it would be
unfair to do so. Their prescription is absolute and binary:
the term is either unfair and hence unenforceable, or not.
Its unfairness must, therefore, be judged by reference to all
situations in which it might potentially be applicable.

I suggest straight out of Lord Dennings common sense hand book

[EXC]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

If, as the judge in Orfoster's case said, a term is only unfair to certain people in certain situations but not to others you have to wonder why the OFT and banks spent 2 years and countless millions conducting a test case.

The judge in Spreadex v Chochrane (a High Court case which was referred to in Orfoster's judgment) was pretty clear about it:

Importantly the Regulations do not operate by precluding
reliance on the contractual term in cases where it would be
unfair to do so. Their prescription is absolute and binary:
the term is either unfair and hence unenforceable, or not.
Its unfairness must, therefore, be judged by reference to all
situations in which it might potentially be applicable.

[ncf355]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

Excellent stuff

Apologies if this was obvious from todays broadcast but I'm at work!

Best of british to all

:tinysmile_grin_t:

[EXC]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

Also, I'm curious - if Lloyds take on the challenge - are the potential risks of legal costs high, or is there a clear argument for public interest limiting the exposure to costs?

It's not just a question of clear public interest from a bank charges perspective, it's much wider and more fundamental than that. It's about the very effect, application and operation of UTCCRs generally and something that needs to be determined.

[ncf355]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

Thanks Cel




Shame, so you guys obviously didn't think there was sufficient traction to argue Durkin/Rico style damages?

Also, I'm curious - if Lloyds take on the challenge - are the potential risks of legal costs high, or is there a clear argument for public interest limiting the exposure to costs?

[enaid]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

No we are not challenging the level of damages awarded

he he me thinks we can do enough damage if things go our way lol

[Celestine]

Re: LegalBeagle Wins Bank Charge Case - Lloyds Overdraft Terms deemed Unfair

No we are not challenging the level of damages awarded