OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

[Budgie]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

UPDATED Q & A's FROM THE FOS WEBSITE ,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,, Link FAQs complaints about bank charges


Frequently-asked questions complaints about bank charges

What's happening on complaints about unauthorised overdraft charges?

The Financial Ombudsman Service – and courts across the country – put individual complaints about unauthorised overdraft charges on hold, while waiting for an important legal "test case".

The Financial Services Authority (FSA) also agreed that banks could suspend their work on complaints about these charges, until the "test case" decision was made.

The Supreme Court issued its decision on the "test case" [summary in PDF format] on 25 November 2009. The Court made a unanimous ruling on the issues on which the Office of Fair Trading (OFT) had sought a decision. The courts ruled that the OFT is restricted in its power to assess the fairness of unauthorised overdraft charges made by banks.

The law is one of the things that the ombudsman has to take into account when we decide cases. This is why the Supreme Court's ruling is very important to our work.

So we are now considering the Supreme Court's decision – and its implications – very carefully. However, our initial understanding is that it means it will be unlikely that the cases we have on hold would succeed.

My complaint with the ombudsman service was put on hold during the court case. What do I need to do now?
You don't need to do anything. We will be in touch with you, once we have been able to consider in detail the Supreme Court's decision – and what it means for the complaints we put on hold.

What about complaints that involve bank charges as well as financial hardship problems?
If you are in genuine financial hardship, you should let your bank or building society know as soon as possible. Give them the necessary information about your financial circumstances to enable them to consider your situation fully.
If you are unhappy with their response, you can make an official complaint – and your bank or building society must deal with that complaint.
If your bank or building society agrees that you are experiencing financial hardship, they should suggest an appropriate settlement. This may or may not involve a refund of charges – depending on the circumstances.
If you're not happy with your bank or building society's response to an official complaint, we can look to see if we are able to deal with your case before the legal position on bank charges has been finally settled.

We have written to the major current-account providers [letter opens in PDF] and claims-management companies [letter opens in PDF] to set out our approach to cases involving current account-charges and financial hardship – and to ask for cooperation in ensuring the efficient handling of these complaints.

[grimbell]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

My complaint against A&L was with the FOS but they sent me a letter a few days ago saying that they were passing it back to the bank.

[EXC]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

Bit limited for time and have not read any posts yet but briefly this is - in a nutshell - Tom Brennan’s take on the judgment and the OFT‘s position.

It took me and Ame a while to get our heads round it but in simple terms the judgment is very limited in it’s scope and only prevents the OFT from pursuing a specific area of fairness - that the charges simply don’t represent value for money for the services provided in return.

But the judgment was clear that it ‘’does not preclude’’ (does not rule out) the OFT from being able to make a fairness assessment as to whether ’contrary to the requirement of good faith, the charges cause a significant imbalance in the parties’ rights and obligations arising under the contract, to the detriment of the consumer.’

In other words, to use Tom’s extreme example, although the charges themselves could be £1000 a pop without actually being unfair in themselves the charges are still capable of causing an unfair contractual balance overall, simply because they’re so high

[Smasher]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

Further to that, who got the opportunity to negotiate or even a choice to accept or decline the 'services' that were enforced on their accounts in September 2007?

[fuzzybrain]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

Smasher - were the PoC's we used on reclaims affected by todays decision - or were they covering sec 5 and 6 of the uttr???

[Budgie]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

There were so many POC variations around fuzzy it is difficult to give a definitive response.

The one I used was mainly penalty based but contained a generic reference to unfairness under UTCCR1999. It also mentioned supply of goods and services act though.

At the end of the day it is no great problem to vary the POC ( particulars of claim ) but we need to fully review the Supreme Court judgment and await the lifting of county court claim stays and see what the OFT plan to do before rushing headlong into issuing brand new shiny POC's.

Of greater concern ( and top priority ) are situations where Consumers are currently going through court cases, where the banks are pursuing the Consumer and where the Consumer may have used the test case situation and unfair level of charges argument as a defence or counterclaim. We need, as a site, to discuss and issue advice on those situations asap, because one thing is for sure, no other site is going to be focussing on that issue at the present time.

[Curlyben]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

I must admit when this all kicked off I thought they where investigating the use of s5, but now it has become clear that is was all about a few sub-paras of s6.
ALL of my POC's have already been written with ref to s5 anyway, so the game is STILL on.
Also now that the FSA have lifted the waiver, the rules change significantly.

I think the banks have, or soon will, realise that they aren't out of the woods and they will end up with the stuffing they so royally deserve.
Things would of been slightly different had they not almost brought the entire world economy crashing down around us.
It about time they realised that they must be accountable to their customers, ie US !!!

[ncf355]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

Hear Hear CB!

At first I was on a real downer from this decision but now I see it as the dawning of a new age

I can see a HCEO getting my bsuiness very soon

[burns]rubs hands together with a look of pure evil on face[/burns]

[BOBSCOUSE]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

I have one thing to say, pretty apt given the time of year and all that - pointless and all but its cheered me up just a little bit amidst all the pain and confusion.............................



BAH FECKING HUMBUG!!!!!!!

BY THE WAY - IT AIN'T FINISHED YET

[FrankyG]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

I keep hearing of people saying serves you right if your charged 35 pounds for going overdrawn its the same as stealing.The account I have is a basic cash acc.I can only draw money thats in my bank.I cant pay in on the card.I have no overdraft faccility.When a DD cannot be paid I get a letter saying that there is not enough money in my acc to pay it. No money is taken out,no money is taken off the bank.So I am being charged 35 pounds for two letters .One to me and one to who the DD was sent from.This cannot be legal.I just pay the person when my wages go into the bank next time. I have been charged 35 pounds many times for being 20p short of the payment.I wish now I had taken the money A&L had offered even though it was half the ammount.I'm Totally disgusted and outraged at this disgusting court ruling.The goverment have paid out billions baling out the banks for their greedy dealings and underhand tactics.As far as im concerned they can all go forth and multiply.

[TUTTSI]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

I think our earlier pocs pre test case done in early 2007 were done well before this site, so I guess they may all well need revising.

However, my latter POC with Halifax which Budgie kindly helped me with on LB was more up to date so that one might well be OK.

So I am guessing that the earlier ones may well be no good.

We will have to leave it to those who understand the technicalities of this judgement and who can help and guide us.

A huge thank you for all those who went to the Supreme court today and have given us superb reporting as usual.

Tuttsi

[EXC]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

If you have a claim stayed in court I would draw your attention to the advice Amethyst gives in the LB announcement:

''Complaints in at court
DO NOTHING as yet - we are still waiting for Justice MooreBick to come back with a decision on the stays. The MOJ will let us know as soon as they do.''

This is not a dig but other sites are encouraging claimants to write to the court to lift their stay and the speed in which this advice has been formulated - just hours after the judgment - leads me to believe that this advice is not based on any proper legal scrutiny and could turn out to be ill considered. It is pointless in asking for a stay lift as County Court judges will have to wait for guidance from Justice Moore-Bick anyway.

This site will be taking professional legal advice before advising that you do anything.

[Budgie]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

Thanks Exc, great advice.

[ROBSTER]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

I Echo Budgie

If you'd phoned your local county court today you may well have been advised to put something in writing by the desk staff "for consideration by the court" (for what ever reason you had given them) as this is their stock answer. And why wouldn't it be.

I am sure by tomorrow the court staff will have received some measured guidence in this matter and it will be worth noting what they say.

24 or 48 hours is not going to amount to a lot in the big scheme of things.

[Jester]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

To be perfectly honest, it may be worthwhile waiting until the new FSA Bill comes into being as it allows for class action on such subjects.

Can you imagine the clout that would be felt if, for example, the whole of the people on LB waiting for their claims to be dealt with entered it as one massive class action ?

If many of the consumer action websites did similar, then the Banks would be in for a massive shock.

On another note, I'll bet the staff at the County Courts have not welcomed the decision today and the possibility of the Stays being lifted right before Christmas !!!