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It is simply not credible to assume that, had the bank not taken a sum in charges, we would have been able to earn 29.9% (or higher) interest on it and therefore we are entitled to claim that back on the whole sum for the entire period we are claiming for. Speaking for myself i am not presuming i could have earned this or indeed any other specific rate.
This appears to be the "standard" unauthorised rate employed by the banks which is why I used it here. Of course, you can claim any level of interest as long as it is reasonable. However, the court can decide not to allow you interest or only to allow you part of the interest and this is precisely what has been happening.
There is no legal basis for the “mutuality and reciprocity” argument. It is my opinion that the banks taking these charges and charging this interest rate cannot be interpreted as us lending them money. I agree we haven't leant them money they have unlawfully taken it from us.
Regardless of the terminology used, the taking by them of this money does not mean you may claim back all of your charges at the same rate - see Robinson v. Harman 1848.
Mutuality of contract is the reciprocal understanding or agreement between parties that is a requirement in the creation of a legally enforceable contract. It means that an obligation must rest on each party to do or permit to be done something in consideration of the act or promise of the other. Neither party is bound unless both are bound. It does not mean that you are entitled to charge the other party just because they are able to charge you. Were that the case then you would also be obliged to provide your bank with chequebooks, credit cards, loans, clearing facilities along with all the other things that we expect from banks.
In Bank contracts, the Bank has a right to impose interest at the unauthorised rate.
I disagree the unauthorised rate is in effect a further penalty charged in terrorem upon our breach of contract. It is effect a cloaking term which allows the defendant to charge a further penalty upon our breach of contract. edit nearly forgot the bank has also breached the terms of the contract by acting outside of the law have they not?
There are two ways you could view this - you could argue that the charging of this rate is an extortionate credit bargain or you could argue that it is a penalty - but how does claiming back everything you have been charged at this rate, when in fact you very probably only paid it for a very short period of time constitute anything other than this on your part?
This is what we agree to when we enter into the contract. There is no right in the contract for us to receive interest at anything other than the published rate on credit balances. Any right to interest must be found under the common law.
Regarding the Account of Profits argument, this could get hugely complex. See for example Esso Petroleum Co Ltd v. Niad Ltd [2001] Ch D and A-G v. Blake [2001] 1 AC 268 where this is explained in more detail before you consider using this argument.
In A-G v Blake, an account of profits was described as
"An account of profits will be appropriate only in exceptional circumstances. Normally the remedies of damages, specific performance and injunction, coupled with the characterisation of some contractual obligations as fiduciary, will provide an adequate response to a breach of contract. It will be only in exceptional cases, where those remedies are inadequate, that any question of accounting for profits will arise. No fixed rules can be prescribed. The court will have regard to all the circumstances, including the subject matter of the contract, the purpose of the contractual provision which has been breached, the circumstances in which the breach occurred, the consequences of the breach and the circumstances in which relief is being sought. A useful general guide, although not exhaustive, is whether the plaintiff had a legitimate interest in preventing the defendant's profit-making activity and, hence, in depriving him of his profit."
If you choose this course of action you are moving away from what is a relatively straightforward breach of contract claim (our breach too, remember) and into an area of law concerning the award of damages, both compensatory and exemplary, which is going to be tricky and could prove very expensive. agreed
Bear in mind also that restitution does not necessarily mean recovery of all gains made by the Defendant. Certain other factors are relevant to the measure of recovery. Where the Defendant made a substantial contribution, to which the Claimant was not entitled, it is conceivable that the Claimant will only recover the value of that which was taken from him or that profits will be apportioned or that the defendant will receive quantum meruit for his contribution (Boardman v Phipps [1967] 2 AC 46 [32].) For example, the bank will have made profit with or without your money and unless you are George Soros, what money you have in the bank will have made little or no difference to their overall profit. disagreed, the bank makes substantial profits on the basis of their unlawful removal of money from their customer accounts, to consider a single charge as insignificant is IMHO missing the point. although of course a court may agree with your viewpoint.
You have totally disregarded the bargaining power that the sums involved confer on the banks. Remember that in the scheme of things the sums taken in charges represent a tiny fraction of the banks' overall net worth.
If you wish to begin a claim for exemplary damages, then this would appear to be the way to do it - but should you lose, you will lose a great deal more than a few extra pounds in interest. A claim such as this will not be heard on the Small Claims Track, irrespective of the value of the claim.
Initially you will need to convince the Court that you are entitled to the remedy of an account of profits from what is your breach of contract. In itself, no mean feat. Then you will need to persuade the Court that subsequent to your breach of contract the charges levied constitute unjust enrichment to the bank and that the measure of damages is not only the loss to you, the contract breaching party, but also the gain to the enriched party.
Finally, crisbian for completeness we should not talk about winning these claims, to my knowledge nobody has won anything. There has yet to be a contest and if there is no contest then there is no winning or losing - thus far the banks have disposed of the litigation by paying out the claim prior to any hearing. You may have been paid the rate of interest that you claimed, but you did not "win" that rate of interest.
Agreed, before any interest or AoP can be considered the court has to decide if the claimant is entitled to recover the charges full stop and there's the rub, if the claimant asks for stat interest or is offered stat interest plus the charges they have to decide whether to accept and stop action or whether to refuse and proceed to court.
The only course of action where the latter action can be considered in any way sensible is if the claim for CI or AoP is included is if a claim for unlawful charges has to be heard at the same time. The question then becomes whether the claimant blinks first or the bank does. Blinking first could become very expensive.
It could and I have said over and over that we need to remain steadfast, the banks have a great deal more to lose than we do
This appears to be the "standard" unauthorised rate employed by the banks which is why I used it here. Of course, you can claim any level of interest as long as it is reasonable. However, the court can decide not to allow you interest or only to allow you part of the interest and this is precisely what has been happening.
There is no legal basis for the “mutuality and reciprocity” argument. It is my opinion that the banks taking these charges and charging this interest rate cannot be interpreted as us lending them money. I agree we haven't leant them money they have unlawfully taken it from us.
Regardless of the terminology used, the taking by them of this money does not mean you may claim back all of your charges at the same rate - see Robinson v. Harman 1848.
Mutuality of contract is the reciprocal understanding or agreement between parties that is a requirement in the creation of a legally enforceable contract. It means that an obligation must rest on each party to do or permit to be done something in consideration of the act or promise of the other. Neither party is bound unless both are bound. It does not mean that you are entitled to charge the other party just because they are able to charge you. Were that the case then you would also be obliged to provide your bank with chequebooks, credit cards, loans, clearing facilities along with all the other things that we expect from banks.
In Bank contracts, the Bank has a right to impose interest at the unauthorised rate.
I disagree the unauthorised rate is in effect a further penalty charged in terrorem upon our breach of contract. It is effect a cloaking term which allows the defendant to charge a further penalty upon our breach of contract. edit nearly forgot the bank has also breached the terms of the contract by acting outside of the law have they not?
There are two ways you could view this - you could argue that the charging of this rate is an extortionate credit bargain or you could argue that it is a penalty - but how does claiming back everything you have been charged at this rate, when in fact you very probably only paid it for a very short period of time constitute anything other than this on your part?
This is what we agree to when we enter into the contract. There is no right in the contract for us to receive interest at anything other than the published rate on credit balances. Any right to interest must be found under the common law.
Regarding the Account of Profits argument, this could get hugely complex. See for example Esso Petroleum Co Ltd v. Niad Ltd [2001] Ch D and A-G v. Blake [2001] 1 AC 268 where this is explained in more detail before you consider using this argument.
In A-G v Blake, an account of profits was described as
"An account of profits will be appropriate only in exceptional circumstances. Normally the remedies of damages, specific performance and injunction, coupled with the characterisation of some contractual obligations as fiduciary, will provide an adequate response to a breach of contract. It will be only in exceptional cases, where those remedies are inadequate, that any question of accounting for profits will arise. No fixed rules can be prescribed. The court will have regard to all the circumstances, including the subject matter of the contract, the purpose of the contractual provision which has been breached, the circumstances in which the breach occurred, the consequences of the breach and the circumstances in which relief is being sought. A useful general guide, although not exhaustive, is whether the plaintiff had a legitimate interest in preventing the defendant's profit-making activity and, hence, in depriving him of his profit."
If you choose this course of action you are moving away from what is a relatively straightforward breach of contract claim (our breach too, remember) and into an area of law concerning the award of damages, both compensatory and exemplary, which is going to be tricky and could prove very expensive. agreed
Bear in mind also that restitution does not necessarily mean recovery of all gains made by the Defendant. Certain other factors are relevant to the measure of recovery. Where the Defendant made a substantial contribution, to which the Claimant was not entitled, it is conceivable that the Claimant will only recover the value of that which was taken from him or that profits will be apportioned or that the defendant will receive quantum meruit for his contribution (Boardman v Phipps [1967] 2 AC 46 [32].) For example, the bank will have made profit with or without your money and unless you are George Soros, what money you have in the bank will have made little or no difference to their overall profit. disagreed, the bank makes substantial profits on the basis of their unlawful removal of money from their customer accounts, to consider a single charge as insignificant is IMHO missing the point. although of course a court may agree with your viewpoint.
You have totally disregarded the bargaining power that the sums involved confer on the banks. Remember that in the scheme of things the sums taken in charges represent a tiny fraction of the banks' overall net worth.
If you wish to begin a claim for exemplary damages, then this would appear to be the way to do it - but should you lose, you will lose a great deal more than a few extra pounds in interest. A claim such as this will not be heard on the Small Claims Track, irrespective of the value of the claim.
Initially you will need to convince the Court that you are entitled to the remedy of an account of profits from what is your breach of contract. In itself, no mean feat. Then you will need to persuade the Court that subsequent to your breach of contract the charges levied constitute unjust enrichment to the bank and that the measure of damages is not only the loss to you, the contract breaching party, but also the gain to the enriched party.
Finally, crisbian for completeness we should not talk about winning these claims, to my knowledge nobody has won anything. There has yet to be a contest and if there is no contest then there is no winning or losing - thus far the banks have disposed of the litigation by paying out the claim prior to any hearing. You may have been paid the rate of interest that you claimed, but you did not "win" that rate of interest.
Agreed, before any interest or AoP can be considered the court has to decide if the claimant is entitled to recover the charges full stop and there's the rub, if the claimant asks for stat interest or is offered stat interest plus the charges they have to decide whether to accept and stop action or whether to refuse and proceed to court.
The only course of action where the latter action can be considered in any way sensible is if the claim for CI or AoP is included is if a claim for unlawful charges has to be heard at the same time. The question then becomes whether the claimant blinks first or the bank does. Blinking first could become very expensive.
It could and I have said over and over that we need to remain steadfast, the banks have a great deal more to lose than we do
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