askl - Natwest

[askl]

Re: aski - Natwest

Thanks I particularly value your ex-banker insight.

To quote Ian Pollock; "
Mr Justice Smith, a High Court judge has ruled that the bank's terms and conditions, used from 2001 to July 2003, may have included unfair penalties for going overdrawn.


The judge only said Natwest's 2001 charges may be penalties, not that they are penalties. This means the customer would need to show that the charges were actually penalties by proving that the charge did not reflect the bank's costs.

The Judge at the last direct hearing in January agreed and ordered; "The Claimant shall provide answers to the following by 4pm 28 February 2009;
a) the method of calculation, or breakdown that give rise to the Cheque Return Fees being claimed in the £30 per item,
b) the method of calculation, or breakdown that give rise to the sum claimed against the defendant as Excess Borrowing."

As yet NatWest have not supplied a single cost - we now told by Jonathan Sumption QC to the five Law Lords hearing the appeal that overdraft fees involved a large element of cross-subsidy.

Therefore it presumably follows that 2001 NatWest Charges (which these are) are unenforceable penalties.

[natweststaffmember]

Re: aski - Natwest

ok, this is a business account not a personal account. What were your Particulars of claim?

[askl]

Re: aski - Natwest

I'll post my particulars tomorrow.
However in brief;
I guaranteed the banking facility for a Company in 2000.
In 2000/ 01 the bank did not honour this guarantee, artificially forcing cheques to bounce and charged penalty fees.
The Company was profitable, had repaid all monies owed to the bank and would have been owed money by the Bank had it not been for these penalty charges it imposed on the Company.
The Company had to stop trading as a consequence of these penalty charges.
The Bank charged £2,000 for bouncing 30 cheques and £2,000 for supposedly going over facility limits, which the company did not,
During the period of disagreement the bank charged 33% interest, effectively doubling the amount every two years, so £4,000 became £8,000 in 2003, £16,000 in 2005,
In 2007 the Bank Claimed £14,000 penalty charges from me in person, using the bank guarantee it had previously refused to honour.
It then asked for the case to be stayed and using 33% interest over the period of stay, doubled its claim from £12,000 to £28,000 and £20,000 legal costs - this is their claim for what started as a disagreement over £4,000 penalties.

OH YES, AND THE AMOUNTS CHARGED WERE PENALTIES, OVER AND ABOVE THE COST TO THE BANK AND UNEFORCABLE AND THE INTEREST RATE OF 33% WAS EXCESSIVE CONSIDERING THE DISAGREEMENT WAS OVER PENALTY CHARGES.

I am counterclaiming for loss of earnings from the profitable company.

[natweststaffmember]

Re: aski - Natwest

Case law you have?

[askl]

Re: aski - Natwest

Dunlop - any other suggestions?

[natweststaffmember]

Re: aski - Natwest

If it's not in the POC now then we could be in real trouble....

[Amethyst]

Re: aski - Natwest

I guaranteed the banking facility for a Company in 2000.
In 2000/ 01 the bank did not honour this guarantee,

I will await your particulars as I'm not quote understanding of the circumstances but it would appear this is the crux of the case, the penalties being 2001 and under the only set of terms the judge in the high court caid could possibly be capable of being penal, and the refusal of natwest to disclose costs on order - all sounds favourable really doesnt it.

look forward to seeing more tmw.

[natweststaffmember]

Re: aski - Natwest

I don't get why NatWest are seeking that the stay be lifted, I can see the judge perhaps at his own volition but not the bank. That is why I have queried the case law.

[Amethyst]

Re: aski - Natwest

Natwest hoping they can do same as Barclays using the read over from the test case judgement and get the case struck out (or in this case summary judgment in their favour) as having no merit.

Not sure what their thinking is on the 2001 part of the Judgment but I havent looked at the similarties or differences between 2001 personal current account terms and 2001 business account terms for natwest.

the wording and layout etc would need to be materially the same and not the same as later personal account conditions which were found incapable of being penal.

I presume askl has looked at these indepth already probably a post with both to compare would be of interest.

[natweststaffmember]

Re: aski - Natwest

That is why I can't work out why NatWest have asked for the claim to be lifted. Banks' do not tend to want to do this unless they have a chance of success. Could they be willing to reduce the amount being claimed by accepting that the charges were unlawful? And I hope the schedule of charges are absolutely 100% accurate or they may look at the minutiae of the case.

[askl]

Re: aski - Natwest

Thanks everyone especially - NatWestStaffMember - you are a genious! Resolved a riddle.
As you can tell I no lawyer.

In the last paragraph to its updated particulars received this week NatWest has included the following;
"I therefore respectfully suggest that the Claimant be awarded summary judgement for the sum claimed plus interest and costs. In the alternative I ask that the Claimant be awarded judgement for the sum of £27,336.76 being the balance claimed minus the charges with the balance relating to the charges to go to trial."

Then there is a schedule listing charges since March 2001 totaling £1,151.55 (this is misses about £2k worth of charges prior to March 2001 for no apparent reason).

I have now worked out the £27,336.76 is arrived at taking the original claim of £28,551.56 - £1,151.55 and - a spurious £63.25.

NB their claim is entirely made up of bank charges and interest.
So;
a) They have only included penalties since March 2001 (is that because the case started in Feb 2007 - therefore 6 years - again strange as they are claiming pre-March 2001 penalties from me).
b) They are not taking off the interest they have charged on the penalties themselves - approximately £10k on the above £1,151.55 penalties.

I will try to type out the new Claim today, it's only three pages long - but I'm no typist.

[askl]

Re: aski - Natwest

Natwest hoping they can do same as Barclays using the read over from the test case judgement and get the case struck out (or in this case summary judgment in their favour) as having no merit.

Not sure what their thinking is on the 2001 part of the Judgment but I havent looked at the similarties or differences between 2001 personal current account terms and 2001 business account terms for natwest.

the wording and layout etc would need to be materially the same and not the same as later personal account conditions which were found incapable of being penal.

I presume askl has looked at these indepth already probably a post with both to compare would be of interest.

Amethyst,

There is no material difference except that there is a monthly bank charge for business accounts, therefore there's no cross-subsidisation. However, that aside since before the OFT case started my defence has been that NatWest's notification of a charge for unpaid cheques (or invoice if you like) reads;

"As dealing with unpaid cheques means extra adminitrastive work, I have charged a fee of £30 to cover these costs".

It says to cover these costs. It does not say or suggest that the admin costs are less than £30 per cheque ala; the "charges cross subsidise other parts of banking" stated by Jonathan Sumption QC in the House of Lords (OFT v Banks June 09).

[Amethyst]

Re: aski - Natwest

I hope these 'commentators' have actually read the 2001 business account conditions.

Its not, as I am sure you aware from Justice Smiths judgment, just the wording but the location and document and context the term is contained in.

I would think the fact they havent supplied the terms would mean the judge will be unable to take natwests word that they differ - and I would expect the Judge, if natwest do intend to go down that route, will order them to supply said terms in their bundle.


have you had a read of the barclays salford judgment information?

[Amethyst]

Re: aski - Natwest

Just a little thing

you say they were claiming £28k and have taken off £1500 for the penalties incurred since March 2001 ?

So basically they have said ok fair enough 2001 terms charges are penalties and we'll refund them (ignoring interest paid on them etc) but we'll still claim the rest ?

Is that right or have i misunderstood your post ?

[askl]

Re: aski - Natwest

Amended Claim brought by NatWest along with draft order to strike out my defence etc, (although I have not defended this newly amended claim)
Dated 15 June 2009 received Saturday 20 June.

I xxxx, a solicitor at Shoosmiths ........ state as follows;

1. I am a Solicitor acting on behalf of the Claimant at the above address, I have care and conduct of this matter on behalf of the Claimant, under the supervision of my Principals. I make this Witness Statement believing the same to be true and accurate from information provided to me by the CMS Unsecured Defended Team. I believe that the information provided to me by the CMS Unsecured Defended Team is true and accurate.


2. Throughout this Witness Statement I refer to copy documents now shown to me in an Exhibit market CP1. Unless otherwise stated the contents of these documents are true and accurate.

3. I make this Statement in support of the Claimant's Application for Summary Judgement pursuant to CPR Part 24 and in opposition of the Defendant's applicant to strike out the claim.

The Claim

4. The Defendant signed a guarantee on 20th June 2000 guaranteeing to repay the debts of XXXXX ("the Company"). The guarantee was limited to the sum of £14,000 plus interest and costs since demand. A copy of the guarantee is attached at pages 1 to 6 of bundle CP1.

5. The Company held the following accounts:


........

The Defence

6. The Defendant's initial Defence stated that he did not personally hold the account with the Claimant. The Claimant has since amended its Particulars of Claim to make clear that it is pursuing monies due under a guarantee. It appears that the Defendant now accepts that the Company held this account.

7. The Defendant is now defending the Claim on the basis of bank charges that have applied.

8. The Defendant has also entered a counterclaim of the sum of £25,395 for bank charges plus £16,000 in damages which he states he lost as a result of the Claimant breaching the terms of the agreement. The Defendant then takes off the amount claimed by the Claimant and states that this Counterclaim is reduced to the sum of £12,844.

9. The Defendant is therefore asking the Court to set off the Bank Charges against the Claim and states that he should be awarded damages for the Claimant breaching the terms of the agreement.

Background of Proceedings

10. Proceedings were issued online through the County Court Bulk Centre on 29 January 2007.

11. The Defendant entered a Defence on 23 February 2007.

12. On 5 June the Court ordered that the Claimant clarify its claim by providing further information and/or amending the Claim Form. The Claimant filed and served amended Particulars of Claim on 25 October 2007.

13. The Claimant then made an application to lift the stay on proceedings and transfer the matter to the Defendant's local County Court on 19 December 2007. The Court ordered that a Directions Hearing take place on 10 April 2008. At the Directions Hearing the Court granted permission for the Claimant to file and serve the amended Particulars of Claim to include a breakdown of the Claimant's charges for administering the Defendant's unpaid cheques and the daily charge for unauthorised overdrafts as well a details of the contract giving use to the contractual rate of interest claimed. The Defendant was then [asked] to file and serve an amended Defence by 16 may 2008 with Allocation Questionnaire's to be filed by 31 May 2008.

14. The breakdown of charges was then files and served on 17 September 2008. There was a delay in responding to this as the Claimant had to order statement and documentation and this took some time to arrive. We agreed by Consent that the Defendant could file his amended Defence by 1 October 2008.

15. The Court ordered on 27 November 2008 that the Claimant's time for compliance of the Order sated 3 September 2008 be extended till 13 November 2008 and that the Defendant could file his Defence by 19 December 2008.

16. On 16 December 2008 the Defendant made a part 18 Request for Further Information stating that he would not be in a position to file his amended Defence until he received the response.

17. The Defendant then filed a Defence and Counterclaim on 19 December 2008.

18. The Defendant states that he disputes the bank charges applied were fair and also states that the Claimant has not provided any contract for its basis for making unarranged overdraft and interest charges.

19. A further directions hearing was scheduled for 28 January 2009.

20. The Court ordered the Claim be stayed pending the outcome of the OFT Litigation or upon the Claimant's application that the above mentioned litigation is not relevant to its claim.

21. The Court ordered that subject to paragraph 1, permission to either party to lift the stay or seek further directions.

22. The Court also ordered that the Claimant shall serve in writing a response to the Defendant by 28 February 2009 a method of calculation or the breakdown that give rise to the cheque return fees and the method of calculation for the excess borrowing. [MB the actual wording is "the method of calculation, or the break-down, that gives rise to "cheque return fees" being claimed in the sum of £30.00 per item" and similarly "the sums claimed against the defendant as "excess borrowing"].

The Claimant's Position
23. The Claimant is unable to provide any further breakdown in relation to charges other than what had already been supplied. This has been made clear to the Defendant. [NatWest have only provide a list of items to date, not the calculation or break-down of the £30 charge itself - the Judge became quite angry with NatWest's barrister sent to the January hearing for saying that a list of charges was sufficient, although the Judge accepted the original wording was not as clear as it could have been - that is why the Judge rephrased it and ordered NatWest to provide it by February - and why we are having our hearing on 7 July.]

24. The Claimant's claim is not affected by the OFT Test Litigation in relation to charges as the charges applied here are on the Company borrowing and not personal accounts which the OFT Test Case is looking to determine. I therefore ask that the stay on the proceedings be lifted.

25. The Defendant is not entitled to bring a counterclaim nor an argument of set off against the Claimant on behalf pf the Company. If the liquidator felt that it was the Claimant that caused the Company to go into liquidation then it would have been for the liquidator to bring a claim against the Claimant. The Defendant cannot bring this claim on behalf of the Company.

26. I therefore respectfully suggest that the Claimant be awarded summary judgement for the sum claimed plus interest and costs. In the alternative I ask that the Claimant be awarded judgement for the sum of £27,336.76 being the balance claimed minus the charges with the balance relating to the charges to go to trial.

Statement of Truth etc............





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