Nationwide & Test Case Ruling

[jax007]

I want to start a second claim against Nationwide (first one stayed in MCOL). Am I right in thinking that one of the outcomes from the Test Case is that Nationwide's charges do not amount to penalties?

If they DON'T amount to penalties - does this apply to both current and historic terms?

If so - how can I reword the initial 'Request for Refund' letter so I don't make statements that aren't true?

Is it just UTCCR that I can rely on?

Any help would be appreciated on this one.

jax

[Budgie]

Re: Nationwide & Test Case Ruling

Yes you are correct.

Nationwide have not changed their terms and conditions for many years unlike most of the other Banks who changed their terms and conditions after the test case was announced.

As the Judge has already passed down his judgment that none of the Nationwide current terms are capable of amounting to penalties under common law then this will also apply to the historic terms for Nationwide ( because they are the same ). Nationwide asked for permission to be excused from the upcoming hearing on the 7th, 8th, 9th July for this reason.

However as the Judge ruled that the current terms of all the Banks and Nationwide are not exempt from a test of fairness against UTCCR 1999 then it follows that the historic terms for Nationwide will also not be exempt ( because they are the same ).

So unless you can identify some specific terms in the Nationwide terms and conditions that have not been specifically ruled by the Judge as not being capable of amounting to a penalty then you can effectively only make a claim for return of charges based upon UTCCR1999.

Someone, as a general exercise, really needs to study the judgment to see exactly which terms the Judge looked at for Nationwide wrt penalties and then look through the full Nationwide terms and see if any other additional terms can be identifed which a claimant could argue may actually be considered as penalties. The Judges reasons for deciding that the terms he actually studied in the test case are not capable of being penalties would have to be taking into account to see if they might also be applicable or not applicable to any additional terms that might be identified. However, I fancy that this will probably be a fruitless task.

Jas, just bear in mind that if you file a new claim in the County Court, it will be stayed anyway, pending the result of the Banks appeal against the initial UTCCR1999 judgment. The fact that you send an initial reclaim letter to the Nationwide would be enough to ensure that your claim is lodged in the system at the present time.

Budgie

[jax007]

Re: Nationwide & Test Case Ruling

Thanks Bud

So ... to sum up ...............

If I send the usual RFR letter (you might remember you helped me do one in the light of recent rulings) but just refer to the UTCCR bit and leave out anything that refers to charges being unlawful???

Would that be right?

jax

[Budgie]

Re: Nationwide & Test Case Ruling

We have not yet managed to get hold of the original G1 and G2 annexes produced by the OFT to see how they actually worded their contentions that certain terms in the Nationwide T+C's were capable of amounting to penalties. So we have to rely on the Judges introduction in para 316.


Below are the relevant paragraphs from the Judgement.

Penalties - Nationwide’s terms

316. The OFT’s pleading refers to conditions 49 and 51 of Nationwide’s Terms and Conditions as being capable of imposing obligations or prohibitions on customers and so of giving rise to penalties. However, when considering whether Nationwide’s Relevant Charges might be charged in respect of breaches of contract by customers, I am (as the parties agree) also to have regard to conditions 1 and 14 (reference to these apparently being omitted from the OFT’s pleading in error).
317. I do not consider that any of these conditions imposes any relevant obligation or prohibition upon Nationwide’s customers (rather than limitations on the rights of customers and the corresponding obligations of Nationwide). Condition 1 provides that withdrawal of membership is a possible consequence of the customer being overdrawn without or beyond an agreed facility, but it does not specify that he is or might be in contractual breach in these circumstances. Condition 14 limits Nationwide’s obligation to pay in accordance with the customer’s instructions to when there are enough cleared funds in the account. Condition 49 does not provide that it is a breach of contract to use a cheque guarantee card if payment of the cheque will result in an overdraft (or an overdraft in excess of an agreed facility). It simply makes it clear that as between Bank and customer there is no obligation on the Bank to honour the payment (notwithstanding Nationwide’s obligation to the payee), and that as between Nationwide and its customer the payment does not give rise to an agreed overdraft. The condition does not include an undertaking on the part of the customer not to use his card without having adequate funds in his account or a facility to cover the payment. Condition 51 does not state, and is not, in my judgment, to be taken to imply, that it is a breach of contract for the customer to give a Relevant Instruction (or to give a Relevant Instruction that Nationwide accepts). It acknowledges that the customer might be in breach of contract if, payment having been made upon a Relevant Instruction, he does not “immediately” repay the resulting overdrawing, but the obligation to make immediate repayment of the unarranged overdraft arises only once the account is in debit. No Relevant Charges are payable because of a failure to bring the account back into credit, and the customer’s obligation under condition 51 is irrelevant to whether the Relevant Charges (or the Relevant Terms) are capable of being penal.
318. I do not overlook that in its leaflet “Making the most of your Overdraft” Nationwide states under the heading “What if I know I am going to exceed my overdraft limit?” that “Exceeding your unauthorised limit is a breach of terms and conditions and will incur a charge”. That is not, in my judgment, an accurate statement. The leaflet itself is not a contractual document and does not itself create any contractual obligation or prohibition that is binding upon customers.

and here is a link to the Nationwides current terms and conditions :-
http://www.nationwide.co.uk/pdf/curr...Conditions.pdf

I cannot personally identify any other terms within the Nationwide's T+C's that IMO could be capable of being considered as penal. So yes as far as your new claim is concerned Jax, I would suggest just deleting any reference to "penalty under common law" aspects that might presently be contained within the template letter you intend to use.

Rgds Budgie

[jax007]

Re: Nationwide & Test Case Ruling

Thanx hun

Have emailed you a letter - could you just vet it for me before I send it off please?

Ta muchly

jax