Judgment & Beyond ~ Budgie Vs Capital One

[ed.]

Re: Budgie Vs Capital One

Reads fine mate and it's vague enough for the Court to consider such an action itself if it wants, without you infact actually asking or threatening it. Gives you a bit more leave to play it by ear.

I can't wait to use it against TSB, wasn't appropriate when I was in the other week sadly but I know at some point I'll probably put it in a letter to SCAM.

As long as you have notes re M+R and Sempra to show they are again trying to subvert the true position you will be able to talk through it properly when the time comes.

At no point in your POC that I could see did you reference a claim on the basis of mutuality and reciprocity under UTCCR, so Halliday is completely irrelevant here.

Only other thing, remember Sempra is effectively restitution in common/contract not restitution in equity so the old tests of restitution don't actually apply. The less you can call it restitution the better, stick to an appropriate level of interest based on the time value of money and more suitable in these circumstances that 8% etc.

If DJ gets it into his head it's restitution he'll keep thinking of equity, and the old tests.

[Budgie]

Re: Budgie Vs Capital One

Reads fine mate and it's vague enough for the Court to consider such an action itself if it wants, without you infact actually asking or threatening it. Gives you a bit more leave to play it by ear.

I can't wait to use it against TSB, wasn't appropriate when I was in the other week sadly but I know at some point I'll probably put it in a letter to SCAM.

As long as you have notes re M+R and Sempra to show they are again trying to subvert the true position you will be able to talk through it properly when the time comes.

At no point in your POC that I could see did you reference a claim on the basis of mutuality and reciprocity under UTCCR, so Halliday is completely irrelevant here.

Only other thing, remember Sempra is effectively restitution in common/contract not restitution in equity so the old tests of restitution don't actually apply. The less you can call it restitution the better, stick to an appropriate level of interest based on the time value of money and more suitable in these circumstances that 8% etc.

If DJ gets it into his head it's restitution he'll keep thinking of equity, and the old tests.

Thanks Ed,

I cant wait till Wednesday, it's gonna be fun.

Was aware of the Sempra relevance and the need to refer to time value of money rather than equity but thanks for the reminder.

Voyager9 on CAG actually has a very similar claim to mine running at present with Cap One and has a hearing tomorrow. Voyager9 has promised to let me know how things go so I will update the thread here as soon as I hear anything.

Will wait another hour or so to see if anyone else has any imput and will then print and fax the WS.

Thanks once again for your valuable input.

Budgie



For general reference :


From The Times

July 25, 2007


Compound interest is payable in restitution

House of Lords
Published July 25, 2007
Sempra Metals Ltd (formerly Metallgesellschaft Ltd) v Inland Revenue Commissioners and Another
Before Lord Nicholls of Birkenhead, Lord Hope of Craighead, Lord Scott of Foscote, Lord Walker of Gestingthorpe and Lord Mance
Speeches July 18, 2007
The court had power to make an award of compound interest in a claim for restitution where such an award was necessary to achieve full justice for the claimant.
The House of Lords so held (Lord Scott and Lord Mance dissenting) in dismissing an appeal by the Inland Revenue Commissioners and the Attorney-General from the dismissal by the Court of Appeal (Lord Justice Chadwick, Lord Justice Laws and Lord Justice Jonathan Parker) ( The Times April 26, 2005; [2005] 3 WLR 521) of their appeal from Mr Justice Park ( The Times June 25, 2004; [2004] STC 1178) who awarded compound interest to the claimant, Sempra Metals Ltd, formerly Metallgesellschaft Ltd.
Mr Ian Glick, QC, Mr Rupert Baldry and Mr Gerry Facenna for the Revenue; Mr Laurence Rabinowitz, QC, Mr Francis Fitzpatrick and Mr Steven Elliott for Sempra.
LORD NICHOLLS said that in (Joined cases C-397/98 and C-410/98) Metallgesellschaft Ltd v Inland Revenue Commissioners ( The Times March 20, 2001; [2001] Ch 620) the Court of Justice of the European Communities held that United Kingdom tax provisions concerning payment of advanced corporation tax as it affected subsidiary companies whose parent company was outside the UK contravened article 52, now article 43, of the EC Treaty.
The instant case was a test claim under a group litigation order made to manage the numerous claims brought against the Inland Revenue as a result of that decision.
The detriment suffered by a taxpayer by the premature payment of tax was loss of use of the money for the period of prematurity. So if a taxpayer had to borrow the money, and his claim was for damages, his loss comprised the cost of borrowing the money for the period of prematurity.
Alternatively, if the taxpayer’s reparation claim was framed in restitution, the Inland Revenue’s unjust enrichment comprised the benefit of having use of the money for the period of prematurity. Either way the essence of the taxpayer’s claim was for an amount of money by way of interest in respect of the tax paid prematurely.
Under English law, as a general rule a claimant could recover damages for losses caused by a breach of contract or a tort which satisfied the usual remoteness tests. That broad common-law principle was subject to an anomalous exception, comprising claims for interest losses by way of damages for breach of a contract to pay a debt. Damages were not recoverable in cases falling within that exception: see London, Chatham and Dover Railway Co v South Eastern Railway Co ([1893] AC 429).
The common law should sanction injustice no longer. The House should recognise the remnant of the restrictive common-law exception for what it was: the unprincipled remnant of an unprincipled rule.
To that end the House should now hold that, in principle, it was always open to a claimant to plead and prove his actual interest losses caused by late payment of a debt. Those losses would be recoverable, subject to the principles governing all claims for damages for breach of contract, such as remoteness, failure to mitigate and so forth.
At present, the court was considered to have no jurisdiction to make an award of compound interest on a personal claim for restitution of a sum of money paid by mistake or following an unlawful demand.
The position in London, Chatham and Dover Railway was the same regarding an award of interest on a claim for repayment of money paid by mistake because a claim for repayment of money paid by mistake was founded on an implied contract. The fiction of an implied contract lingered long in the law and was not finally removed until Lipkin Gorman v Karpnale Ltd ([1991] 2 AC 548).
Meanwhile the law on the courts’ inability to award interest at common law on restitutionary claims remained settled. Hence in Westdeutsche Landesbank Girozentrale v Islington London Borough Council ([1996] AC 669), counsel argued the case on the basis that no interest, whether compound or simple, was recoverable at common law. But, sometimes interest, compound as well as simple, was recoverable in equity. The appeal proceeded on that footing.
In those unusual circumstances, it was open to the House to reexamine the basic point of law conceded and not argued on the Westdeutsche appeal, namely, whether interest might be awarded by the courts in exercise of their common law jurisdiction to grant personal restitutionary relief.
Having only recently been released from the shackles of implied contract and, hence, the restraints of the London, Chatham and Dover Railway case, the law of restitution should now have the opportunity to develop as a coherent body of principled law. The decision of the House in a case where that point had been conceded and assumed could not properly stand in the way.
If the House took that opportunity there could only be one answer. Nobody had suggested a good reason why, in a case like the present, an award of compound interest should be denied to a claimant. An award of compound interest was necessary to achieve full restitution and, hence, a just result.
His Lordship would hold that, in the exercise of its common-law restitutionary jurisdiction, the court had power to make such an award. If that approach was adopted, the unfortunate decision in the London, Chatham and Dover Railway case would be effectually buried in relation to the payment of interest for nonpayment of a debt and in relation to the payment of interest for having the use of money in personal restitution cases.
In cases of personal restitution the value of the use of money was prima facie the reasonable cost of borrowing the money in question. The time value of money, measured objectively in that way, was to be distinguished from the value of the benefits a defendant actually derived from the use of the money.
In the present case there could be nothing unjust in requiring the Inland Revenue to pay compound interest, by way of restitution, on the huge interest-free loan constituted by the payment of advance corporation tax.
But that would not always be so. For instance, a recipient of a payment made by a mistake might make no actual use of the money. He might pay the money into a current account at a bank yielding little or no interest.
In such a case, depending on the circumstances, it might well be most unfair that he should be out of pocket by having to make an additional payment, whether as compound interest or even simple interest, in respect of the time value of the money he received.
Here, as elsewhere, the law of restitution was sufficiently flexible to achieve a just result. To avoid what would otherwise be an unjust outcome the court could, in an appropriate case, depart from the market-value approach when assessing the time value of money or, indeed, when assessing the value of any other benefit gained by a defendant.
The United Kingdom government could of course borrow more cheaply than commercial companies. The rate for the restitutionary claims therefore should be the rate at which the government could borrow the relevant amounts in the market at the relevant times.
Lord Hope delivered a concurring speech. Lord Walker delivered a speech concurring in the result. Lord Scott and Lord Mance delivered speeches dissenting in part.
Solicitors: Solicitor, Revenue and Customs; Slaughter & May.

[ed.]

Re: Budgie Vs Capital One

Didn't mean to teach you how to suck eggs mate, sorry if it came over like that.

Yeah you can have some fun with that, very interested how voyager9 gets on so will look forward to that update, cheers.

ps - could I have the weblink for that article, I don't recall seeing it before and it explains the ruling very well.

[Budgie]

Re: Budgie Vs Capital One

Didn't mean to teach you how to suck eggs mate, sorry if it came over like that.

Yeah you can have some fun with that, very interested how voyager9 gets on so will look forward to that update, cheers.

ps - could I have the weblink for that article, I don't recall seeing it before and it explains the ruling very well.

Hey Ed,

I didnt mean to come over as all suck eggy either LOL.
I value your all input.

Here's the link : http://business.timesonline.co.uk/to...cle2133988.ece

[TANZARELLI]

Re: Budgie Vs Capital One

Its looking good Budgie, you seem to have covered all bases and its flows nicely mate.

Good inputs Ed mate also.

[stevokenevo]

Re: Budgie Vs Capital One

loving your work :okay:

[ed.]

Re: Budgie Vs Capital One

lol no probs Budgie. Better to have covered the basics and have you know them/ignore me than not say it I think.

Looking forward to the updates now mate, if I don't catch you before - give them hell tomorrow chap, best of luck, but as long as you have a decent DJ I don't think luck will be an issue!

[Budgie]

Re: Budgie Vs Capital One

Here's Voyager's post regarding his / her hearing today.

case dismissed.

they are argueing because its charges based through a contract restitutution doesnt apply unless you can show that the payments were taken unlawfully( wasnt having oft stuff unfair doesnt mean unlawfull was what judge said) or was paid by a mistake in the legal context what ever that means, paying because you thought they were fair and reasonable etc does not do it as a legal mistake apparantly .

i dont know i dont feel i was well enough prepared but then again didnt know what their legal arguments was going to be , you never know if you make sure your arguments on unlawfullness and/or legal mistake is strong you may still have a chance but as i say i feel i let myself down.

unless you can proove beyond a doubt either of the two things then you dont have a case for restitution.

but at least i still got charges + 8% + all purchase interest paid on account so guess its still a win of sorts.

good luck with your claims
voyager

oh by the way the judge rejected theit argument that there was no case to answer because its a contractual issue but i still had to proove the other issues which i failed to do.

[Amethyst]

Re: Budgie Vs Capital One

Damn.

How you feeling ?

[Tools]

Re: Budgie Vs Capital One

Although it doesn`t sound good Budgie at least this may better prepare you for any similar arguments that may arise tomorrow.

Make sure you are well prepared.

[Budgie]

Re: Budgie Vs Capital One

Not worried at all !

It appears Cap One were arguing against compound interest as restitution on old grounds and Judge chucked out their argument. ( see post 76 from Ed ) So Judge obvioulsy knew the possibility of restitution existed via Sempra.

It appears that Voyager just didn't push the common law penalty aspect hard enough, or even the UTCCR aspect. When / if I actually get to my final hearing I will not be such an easy pushover. Interesting about the alternative of legally proving the default charges were applied by a mistake, again this smacks of Sempra. Will have to do some additional research after tomorrow's hearing. Although I suppose one could argue that because Capital One originally took these charges and are now offering to repay them, without liability, could somehow actually be intrepreted as them having originally taken them by mistake. It's difficult to really know about how this came up with so little information provided by Voyager.

Voyager's hearing was a final hearing, My hearing tomorrow is to hear my application to chuck out their original defence and if that doesnt work I will try to convince Judge to chuck out their revised defence and if that doesnt work I still have the final hearing as a back up. LOL

I feel a bit sorry for Voyager but then again hey it's not as if he or she lost as he / she is still getting back charges plus purchase interest plus stat interest plus court costs.

Budgie

[TANZARELLI]

Re: Budgie Vs Capital One

Not worried at all !

It appears Cap One were arguing against compound interest as restitution on old grounds and Judge chucked out their argument. ( see post 76 from Ed ) So Judge obvioulsy knew the possibility of restitution existed via Sempra.

It appears that Voyager just didn't push the common law penalty aspect hard enough, or even the UTCCR aspect. When / if I actually get to my final hearing I will not be such an easy pushover. Interesting about the alternative of legally proving the default charges were applied by a mistake, again this smacks of Sempra. Will have to do some additional research after tomorrow's hearing. Although I suppose one could argue that because Capital One originally took these charges and are now offering to repay them, without liability, could somehow actually be intrepreted as them having originally taken them by mistake. It's difficult to really know about how this came up with so little information provided by Voyager.

Voyager's hearing was a final hearing, My hearing tomorrow is to hear my application to chuck out their original defence and if that doesnt work I will try to convince Judge to chuck out their revised defence and if that doesnt work I still have the final hearing as a back up. LOL

I feel a bit sorry for Voyager but then again hey it's not as if he or she lost as he / she is still getting back charges plus purchase interest plus stat interest plus court costs.

Budgie

Couldn't agree more Budgie a wins a win. It could have been worse. Was voyager going in purely for interest? Reason I ask is if case dismissed then how come he got the charges and interest a stat 8%? Or was it just the CI that he dismissed?

Would be useful to get some more details from him if you can.

Perhaps he didn't push the Sempra enough.

[ed.]

Re: Budgie Vs Capital One

Yup Voyager did well and that's a win in anyone's book. Shame about the CI element BUT as has always been said if you go CI you need to live and breathe it and know it inside out. If you don't, or don't have the time to put all those extra hours into the research then keep it simple.

Sounds like they gave it a decent shot and won 50% of the argument on the CI issue though, which as you said Budgie shows the DJ was aware and willing (which is the important bit) to entertain Sempra on a case like this. It was the additional arguments that Voyager seemed to struggle on, but a win is a win and they did well, and I'd say won 50% of the CI battle in the process which helps everyone else.

Baby steps and all that. Look at the work, successes and failures that went into M+R and then Sempra was found - same process now, we have some successes, and failures with it so far BUT to me Sempra and what it stands for is slowly being accepted by DJ's and is no longer considered a shot in the dark. Which shows how far all of us CI'ers have come in the last few years.

I agree also, more needs to be made of 'we paid in mistake of law', afterall like the Banks like to claim for similar charges on bank accounts this needs a precedent setting Test Case between them and the Office of Fair Trading and fancy well paid Barristers doesn't it - therefore, of course I paid them in mistake, I'm not a fancy trained barrister, a Government department, or a millionnaire bank with their expensive and vast legal teams. Then misrepresentation etc.

Then hit (even if charges are settled by that point) abuse of process, Bank's standard course of action to avoid a ruling in Court on the issues at hand means they have settled the charges simply to avoid a determination of them, and if CI isn't awarded they are unjustly enriched. So in contract/common as per Sempra, as I needed to borrow at commercial rates, to avoid that unjust enrichment that they are seeking to keep via their actions, I need an interest award of commercial rates.

I also agree Tanz, sounds very much like interest element alone in voyager's case. It would be too much of a turnup in the books for them to have attended a final hearing IF charges were still an issue.

[Amethyst]

Re: Budgie Vs Capital One

~ Good luck tomorrow babe xxxx

[TANZARELLI]

Re: Budgie Vs Capital One

I agree also, more needs to be made of 'we paid in mistake of law', afterall like the Banks like to claim for similar charges on bank accounts this needs a precedent setting Test Case between them and the Office of Fair Trading and fancy well paid Barristers doesn't it - therefore, of course I paid them in mistake, I'm not a fancy trained barrister, a Government department, or a millionnaire bank with their expensive and vast legal teams. Then misrepresentation etc. If this can be nailed its also going ot open up the limitation arguement under s32 also ed don't forget. As you say if its taken a test case to rule on the charges element for current acccounts then how could a LIP be expected to have brought a case before a court until now therefore s32 payment under a mistake.

Thats the arguement for also for rejecting charges settlement offers with CI claims as you want to get a ruling on the charges to prove they are unlawful penalties therefore CI applies under contract/common. Also go for penalties at common for credit cards and back this up with T&C's to show BoC such as my Barclaycard ones:

'16.3 We will charge you for any losses or costs we have to pay if you break this agreement, including if you do not make a minimum payment by the payment date, if your statement balance is over the credit limit, or if a direct debit, cheque or other item is not paid when first presented'

In addition to this if you have a letter like I do from Barclaycard stating:

'we believe it is fair when customers break the terms of their agreement with us, we recover the costs'.

That should add to the arguement.

Then hit (even if charges are settled by that point) abuse of process, Bank's standard course of action to avoid a ruling in Court on the issues at hand means they have settled the charges simply to avoid a determination of them, and if CI isn't awarded they are unjustly enriched. So in contract/common as per Sempra, as I needed to borrow at commercial rates, to avoid that unjust enrichment that they are seeking to keep via their actions, I need an interest award of commercial rates.

Yes mate if you have had to borrow.

I also agree Tanz, sounds very much like interest element alone in voyager's case. It would be too much of a turnup in the books for them to have attended a final hearing IF charges were still an issue.

Love to get more info on this.

Best of for tomorrow mate not that you'll need it. Hope it all goes smooth mate.