Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

[Glenn UK]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

I don't think you will argue that if this was of no financial consequence to the banks that they would have gone to court over it?

Similarly if the banks had acquiesced in the same way that CC companies had, the OFT would not have gone to court either and yet the arguments are exactly the same for bank charges as they are for CC charges.

NWSM points out what they (the OFT) didn't want to happen has and they have done nothing about it, there is nothing to stop them taking CC companies to court to get a determination over what is a fair cc charge though, is there?

The ltigiaiotn agreement may well hold both parties to the line they have chosen to follow, there is no doubt that it is expensive for both parties.

What you seem to be saying is that the cost of going all the way is such that both parties will accept that cost irrespective of the options open to them.

What i am saying is that in the end everything comes down to money and when faced with a siutuaiotn where both parties can argue that they have some sort of victory out of it, that they will settle.

So far i cannot find a compelling economic reason why both the OFT and banks would not settle if it suited both of them.

Something else that is worht poinitng out, i am not saying that either party can force a settlement on the other.

What i am saying is that if there is a solution that both parties can accept then they may take it.

[EXC]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

I
So far i cannot find a compelling economic reason why both the OFT and banks would not settle if it suited both of them..

It's not about money. It's about the law.

http://lmgtfy.com/?q=what+is+a+test+case%3F

[natweststaffmember]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

Glenn UK, I don't understand your viewpoint. You keep saying you suspect they will settle or that there will be a get out clause.
Do you understand that this is a legal case?
If they settle, to go along with your argument, do you think anyone at Legal Beagles will say don't litigate in court to have the banks PROVE their costs?
We have learnt whether i like it or not to DISTRUST banks' for their perceived dishonesty. There has to be a legal response and a legal viewpoint for consumers to be satisfied. Reducing charges to a level which is acceptable without the legal arguments being dealt with is unacceptable. Reducing charges to a fair amount is what is going to happen.

[Tools]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

OK, this is my understanding of issues, someone feel free to correct me if I am wrong (people usually do as it happens often)

If/when the House of Lords uphold the High Court Judgment that the terms are subject to assessment under UTCCR 1999, the OFT, which has already carried out most of their investigations and has concluded in effect that the charges are unfair. This would mean that that specific term in the contracts is unfair under 99 regulations.

This would refer to all unfair charges in their entirety, not just a portion of them, as the specific term would deem the whole contract unenforceable/unfair.

The banks would then have to refund the charges in full and not just the difference between what is considered fair. This would apply to all historic charges(pending a decision on Section 32 of the Limitations Act) back to at least 27th July 2001 that were levied prior to the final decision in the HoL or in the case of Barclays maybe?? from when the assessable T&C`s ran to.

The second part of litigation, "the substantitive issues" should only have a bearing on future fee charging to be encompassed in new/newer T&C`s.

In my opinion, wether it is accurate or not, once the HoL has made its ruling (hopefully for the OFT), then all previous charges should be refunded in their entirety.

I also believe that yes a Court has to rule on what charge level is fair, but they will be guided into making a declaration based on

• the banks own submissions to the OFT as to actual costs plus a fair level of profit(remember it is now UTCCR and not a penalty arguement)
• the OFT's view of what can and can't be included to make up those costs plus what they consider to be a fair profit level on top

The OFT and the banks will no doubt barter and eventually come to some agreement, then submit this to the Courts to pass Judgment on, BUT, this should only be applicable to future charges and not ones already incurred.

Amethyst has posted some good information regarding charges in South Africa by the Competion Commission over there, much of the consultation and procedure for that investigation was guided by the UK's OFT and CC so I am sure there will be some similarities as to what the banks can and cannot include to make up their "costs". Very long and detailed but well worth a read>> south african bank charges confidential report (VIP)
The threads in VIP but you can find the unredacted version on Wikileaks or the redacted version on the South African Competition Commissioners Webiste.

[EXC]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

That's pretty much how I see it with the exception of this:

as the specific term would deem the whole contract unenforceable/unfair.

I don't think that an unfair term would deem the entire contract as unenforceable/unfair, just the particular term.

As Tom explained to us over lunch, if a term is deemed unfair it is automatically struck down in it's entirety taking the whole charge with it. I believe this is because there is no provision in law to alter a term (or the level of charge that the term triggers) retrospectively.

This is why I think people who believe that any eventual refunds would be minus the new level of charge are wrong.

The same could not be said if the charges had been deemed as penalties as a judge would likely allow the banks to retain the costs of administering defaults. Another reason why the OFT were dead right to ignore the penalty issue and pursue it under UTCCR.

[Amethyst]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

Becuase I can;t find it and I'm getting cross thought I would ask you guys. Where exactly did Justice Smith say that his judgment and declarations on penaltys read across to business and basic account terms. He didnt did he, he just said to other terms used currently by the banks. ?

[Amethyst]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

Back to EXCs post --- Think Tools meant it would render the entire term of the contract unenforceable rather the entire contract unenforceable , as they arent core terms because the contract can still stand with the terms gone. If they were core terms then the entire contract would be invalid etc.

[EXC]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

Thanks Ame. I didn't realise the OFT were involved in the South African investigation. Very interesting.

I don't know which judgment Smiffy mentioned the penalties read-over but it'll be in the first penalty declaration (sealed order) or the subsequent judgment that included Natwest's penalties. Not sure what format these are in but if they're PDF's or in 'Word' you could do a word search for 'business' and 'basic account'.

[Amethyst]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

Been through all those - the original judgment, order and declarations and the transcripts and cant find sod all. inferences yes, but not specific.

Have FOI'd the OFT on the SACC meetings btw
Page 8 of http://www.compcom.co.za/banking/Non...%20Process.pdf (redacted version)
Its ALL based on penaltys as per the credit card default fees report. which really makes it even more annoying the oft just rolled over on penalty fees in the test case.

[EXC]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

Been through all those - the original judgment, order and declarations and the transcripts and cant find sod all. inferences yes, but not specific.

Have FOI'd the OFT on the SACC meetings btw
Page 8 of http://www.compcom.co.za/banking/Non...%20Process.pdf (redacted version)
Its ALL based on penaltys as per the credit card default fees report. which really makes it even more annoying the oft just rolled over on penalty fees in the test case.

I thought it wouldn't be long before you'd needed another FoIA fix. Well done.

As to the SACC investigation being based on penalties we can't be sure that the legal definition and status of penalties in South Africa are the same as they are here.

[Amethyst]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

Aye yes I realise that...its the figures that are of most interest in the report. I would expect they follow quite closely though and had the test case not come about this is the kind of thing they might have come up with, and also I think this is the kind of thing that those people who insist on thinking that 'a deal will be done' expect the OFT to come out with in terms of proportional to costs, recommended level. The R5 figure is rather arbitary in relation to the costs isn't it.

As i have said before anything less than a declaration in court will make the whole thing pointless and thus it can't happen.

[Tools]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

I don't think that an unfair term would deem the entire contract as unenforceable/unfair, just the particular term.

Apologies Nick, it was a rushed post over dinner. I did intend to say the whole contract term and not the whole contract.

Assuming I am correct in my thinking, then that should mean that once/if the HoL has upheld both the original Judgment by Justice Smith and the subsequent appeal ruling handed down on the 26th February by Sir Anthony Clarke, then the banks should be forced to begin refunding charges based on that unfair term in the contract. Hopefully this will mean we won't have to wait until the conclusion of round two of litigation before seeing refunds made.

[Curlyben]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

And also, by inference, the FSA waiver should be removed as there is a clear legal case.

[EXC]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

Apologies Nick, it was a rushed post over dinner. I did intend to say the whole contract term and not the whole contract.

Assuming I am correct in my thinking, then that should mean that once/if the HoL has upheld both the original Judgment by Justice Smith and the subsequent appeal ruling handed down on the 26th February by Sir Anthony Clarke, then the banks should be forced to begin refunding charges based on that unfair term in the contract. Hopefully this will mean we won't have to wait until the conclusion of round two of litigation before seeing refunds made.

Absolutely - assuming that the case is not referred to ECJ.

[Tools]

Re: Appeal Judgment - 26th February 2009 - OFT v Abbey National Plc & Otrs

And also, by inference, the FSA waiver should be removed as there is a clear legal case.

I hadn't thought that far, but yes Curly, good point.

Absolutely - assuming that the case is not referred to ECJ.

Hopefully not, but yes true.