Can the bank ‘UNCLEAR’ cleared funds?

[Amethyst]

Re: Can the bank ‘UNCLEAR’ cleared funds?

Thanks Des. I agree with you that it is quite a lot of how the claim has been worded - the bit about the further particulars, then not, then doing it anyway doesn't help.

The fact is still there is that this was money from her mother, who lives with her (think I read that earlier) and was fully aware the cheque had been cancelled. However yes her mum cancelling the second cheque because she was concerned the first had been paid despite cancelling it and not wanting to leave her account twice does assist the argument that she withdrew the money as she relied on it. That really doesn't come across well in the claim.

But still I can't see what other recompense other than all the charges/interest and a bit of compo should be paid, as has happened already.

The £9k is just random - we know that, and the court and bank can see that - there is simply no justification there.

My primary concern is about costs against if you took this all the way and lost.

If mediation is on the table I would take it up and try and extract yourself with no costs.

[MissFM]

Re: Can the bank ‘UNCLEAR’ cleared funds?

Hi Nicola,

Much as it goes against the grain to disagree with Des8, I think Amethyst is absolutely correct in her analysis above.

I would be very concerned about the appearance of fraud, and of conspiracy to defraud.

As these would be criminal charges it would probably be up to the DPP to bring them or not (although I believe the bank could initiate such action), but being cynical it's not impossible that the bank and their solicitors are giving you rope to incriminate yourself.

Just a lay opinion - I've struggled to understand all this, but to the untrained brain it both looks and quacks like a duck, however honourable your intentions.

Just my opinion, offered with goodwill and concern - please disregard if unhelpful.

Good luck whatever you decide to do x

[stevemLS]

Re: Can the bank ‘UNCLEAR’ cleared funds?

Hi Nicola,



Just a lay opinion - I've struggled to understand all this, but to the untrained brain it both looks and quacks like a duck, however honourable your intentions.

Just my opinion, offered with goodwill and concern - please disregard if unhelpful.

Good luck whatever you decide to do x

I have watched this thread but not contributed much from the start as my views were dismissed however they are reflected in this latest post and that of Amethyst and were expressed some months ago.

If the claim is pursued I would expect the bank to lodge a counterclaim based on unjust enrichment.

If it hasn't already been allocated, I can see it going to the fast or multi track based on the alleged complexity. With the attendant costs risks.

Regrettably, in my view, OP's intentions are anything but honourable, it is greed and personal gain.

[Nicola Bell]

Re: Can the bank ‘UNCLEAR’ cleared funds?

Hi,

Phew, I’m impressed with this site.

Amethyst, the fact that I knew that both cheques were cancelled cannot simply equate to fraud. I know there was no fraud so what could be the basis of that claim? The fact that the system is set up in a way that can allow this to happen would presumably not make this fraud.

This was not made into 3 different bank accounts, it was made into one building society. It was just in three parts.

I’m not sure what you mean by ‘it wasn’t a simple error’. Obviously the disadvantage would be losing the money that, under the system, was mine. If it was the other way round, I’m sure the bank would be keen to take ‘advantage’.


I haven’t seen anything that says there are conditions for relying on the 2-4-6 rules. I was aware that the cheques were cancelled but had nothing to do with the process. Do you not think that the bank, who were in control of the cheques, the clearing centre, the funds, the terms and conditions have the major responsibilities? I took the money as I had been told it was mine. I didn’t even ask about that, my only questions were about the whereabouts of the cheque, that is clear from the recording.

How do you reach the conclusion of cock-up rather than what I consider is the misprediction of the second cheque clearing? How could I have moved the funds on day 1 or 2 if the funds were not cleared.

I think if the bank thought there was any question of fraud it would have come up with that suggestion before now. The bank have managed this account for me for 34 years. They would presumably have to have some grounds to say fraud was involved and they have not suggested this. I guess it’s a question of a view of the justice system, will it be just or not.
I can’t see that ‘issues of fraud can overrule the Certainty of fate principle’ without any evidence or suggestion of it. I have no doubt that during the week the cheque was missing, the fraud people had it. As it said in your reference to Raymond Cox 99.5% of cheque fraud is found at the clearing centre.

I know that the way the defence is phrased it is suggestive, but the bank knew the first cheque was stopped but it cleared the funds, that is where the problem lies.

Des8,

Yes, its not a problem to get alternate views, but I still don’t see a stronger case argued than mine. I appreciate that a lot will depend on the judge.

I couldn’t have argued about my mum’s instruction as I would have had no view about timescales for payments to stop, but I had no thought as to whether the instruction was in time to be effective, I would have assumed they were immediate.

In para 22 the bank does not say they don’t know where the cheque was, they say they are ‘unable to establish the reasons for this delay’ for putting it on the account.

I agree with Des8, that, with no stated reason, they say that the 14^th, the day they apply the first cheque to the account is T+2 and for the second cheque also applied on the 14^th is T+1.
I’m pleased with what you say about fraud, obviously only I can know whether there was fraud or not and I know there wasn’t.

Thanks for advice about the venue and I will take your advice. I will have to consider the mediation issue. OH thinks that the issue is a legal one and legal issues aren’t normally decided at mediation, he was a manager in a CAB for 20 years so has some experience of small claims – thinks this is all a waste of energy of course!

Amethyst again.

I think I explained about the particulars but I agree that it doesn’t help.

I can’t see that the fact the cheque was from my mother is relevant. I can however try to make that clearer in the reply to the defence.

I fully understand that these rules are phrased are problematic but these are not my rules, they are made by the bank, they need to change them.


Also, the figure is made clearer in the reply to the defence that I’ll send tomorrow. Surely there should not be great costs, I thought that was what the small claims is for??

Hello Ms M,

Thank you for joining this and for your thoughts.

Can I ask how you see the appearance of fraud, and of conspiracy to defraud. I may be missing something but I still can’t see how a fraud could possibly operate here. How could I incriminate myself when I have acted innocently? I am 61 and my mum 85, the idea that we could have tried to defraud in this way, that appears never to have arisen before and could not possibly be either foreseen or planned is just ridiculous. I cannot see how it looks or quacks like a duck and would be glad of an explanation.


Finally stevemLS,

Thank you too.

I have looked in detail at ‘unjust enrichment’ but it seems there can be no such claim where the issue is governed by Terms and Conditions. There can be enrichment but not unjust enrichment if it is covered by Terms and Conditions, it is defined essentially as ‘the payment of a debt not owed’. If you have any other info about this I would appreciate your thoughts on this. I have read Peter Birks book on this as I thought this might be an issue.

The bank has filed it’s directions questionnaire and it has said small claims is the correct track.

On the moral issue, I think I will only know if my intentions are honourable or greedy if I win and have to decide what to do with any funds.

Thanks to all, I do appreciate it,

Nicola

[Amethyst]

Re: Can the bank ‘UNCLEAR’ cleared funds?

Hi Nicola.

These are possibly all things that might come up through the court process so you need to be able to argue against them - hopefully we are being a good sounding board - and maybe as we are detached we can see things from a different viewpoint. I agree with you in principle but I struggle with the obvious facts that you knew the cheque was cancelled before withdrawing the money - I think that is going to need some thinking about to explain.

Protecting bank customers from cheque fraud

The banking industry introduced the 2-4-6 sterling cheque clearing timescales for customers in November 2007.

As a result, customers can be confident that at the end of six working days after paying a sterling cheque or banker’s draft in to their bank account that the money is theirs and they are protected from any loss, even if the cheque subsequently bounces or if it turns out to be fraudulent. The funds cannot be reclaimed without their consent unless they are a knowing party to fraud.

I think the FOS agreed that they shouldn't have taken the money back without consent, which means there has so far not been any allegation of fraud - it is just an angle to be aware of. The details about your mother's cancellation of the second cheque because the first had cleared and concerns about how the first had cleared despite cancellation should be explained in your reply to cover that issue.

Do you want to post your reply to the defence up first before sending ? - we might be able to make some suggestions to try rationalise the arguments ? Even though I disagree with much, the basic principle is there.

With regards costs in small claims - CPR https://www.justice.gov.uk/courts/pr...s/part27#27.14 ( you want 24.14(2)g ) - the defendant would have to argue that your claim was totally without merit or you behaved unreasonably - but if they did so successfully it would be able to reclaim from you the costs it has incurred in instructing their solicitors and so on. It is by no means a certainty but it is something you should be aware of - you are not entirely protected from costs simply because the claim is under £10k.

Sharon
xx

[Amethyst]

Re: Can the bank ‘UNCLEAR’ cleared funds?

oh, and tell your OH to have a mooch about LB if they fancy, we can always do with more experienced and knowledgeable hands on deck xx

[des8]

Re: Can the bank ‘UNCLEAR’ cleared funds?

[QUOTE=Amethyst;555083]Hi Nicola.
With regards costs in small claims - CPR https://www.justice.gov.uk/courts/pr...s/part27#27.14 ( you want 24.14(2)g ) - the defendant would have to argue that your claim was totally without merit

In a very recent costs hearing I was told by a District Judge that if a defendant believes the claim is totally without merit the correct procedure is to apply for strike out, not waste court time. If the defendant goes through a hearing, and then applies for costs on the basis that the claim is without merit, one must ask why they would do that. In this case the cost of an application would not be a reason that would stand scrutiny.
I see no evidence of unreasonable behaviour by OP, altho' defendants posible delay over filing/serving Defence papers seems a little suspect

[Amethyst]

Re: Can the bank ‘UNCLEAR’ cleared funds?

The claim was bought under further particulars to follow - so the time for filing defence doesn't commence until further particulars are served.

I don't think their defence is particularly good.

And yes indeed, I recall your case the Judge said to apply to strike, however there have been many other case where costs have been ordered under UB, so we know it is a possibility.

[MissFM]

Re: Can the bank ‘UNCLEAR’ cleared funds?

Hello Ms M,

Thank you for joining this and for your thoughts.

Can I ask how you see the appearance of fraud, and of conspiracy to defraud. I may be missing something but I still can’t see how a fraud could possibly operate here. How could I incriminate myself when I have acted innocently? I am 61 and my mum 85, the idea that we could have tried to defraud in this way, that appears never to have arisen before and could not possibly be either foreseen or planned is just ridiculous. I cannot see how it looks or quacks like a duck and would be glad of an explanation.

Nicola, I think there is a misunderstanding here. I'm neither accusing you and your mother of a conspiracy to defraud, nor saying that you had a fraudulent plan to take this money once it had erroneously been credited to your account.

But the appearance of collusion and opportunism is there and it would be surprising (to me) if that were not remarked upon in court, or used as an argument to refute your entitlement to that extra money - even to suggest that your intentions were not as innocent as you believe them to be. Especially in view of your actions following the cancellation of cheque no 1 after you knew the money was in your account. It could, for example, be argued that your mother needed to have no concern re paying the cheque twice as you would have refunded her money in good faith. It also could reasonably be argued that it was calculated that the money was immediately moved to different accounts. Amethyst describes exactly (& much more clearly) how this might appear to others not as certain of your innocent intentions as are you in her post#209. Unfortunately professed good intentions and venerable age are not unusual arguments nor are they relevant as to whether or not certain types of action are within the law.

As said, I wish you well. You have clearly thoroughy researched this point of law and I hope you are correct in your view, if only to stick it to the banks, who perpetrate such conjuring tricks upon their customers all the time.

I'm a more Clapham omnibus sort of person and perhaps I'm letting how things appear from a purely common sense angle to amplify my anxieties over what could happen to you should you pursue this beyond the compensation already received for your inconvenience, especially since you seem to be so shocked that any untoward construction could be put upon your actions. A decent barrister could easily imply much worse.

I hope my fears for you are unfounded and will leave you in the hands of the experts - my apologies for any offense caused x

[Nicola Bell]

Re: Can the bank ‘UNCLEAR’ cleared funds?

Hello Amethyst,

Thanks for input again and yes, that is why the site has been so helpful to me. I’m not taking any of it personally, I’m happy to look at all angles.

I’m still not sure what you think the actual problem is with withdrawing the money. I knew the cheque was cancelled but I could also see that the bank was obliged to pay it due to the regulations. The system is set up in this way because the banks previously took too long to clear for Certainty of fate. The system says 6 days and they had passed, the bank said the cheque was clear and all the evidence is that it was. I didn’t design the system, I can see it has obvious problems. If the bank had co-operated to find the cheque (or even look for it) and been honest with me I believe this would not have happened. I believe that the bank had the cheque all the time and that is why they have not provided details of when they received the cheque. It’s really not me that should be considered as possibly fraudulent.

On another note, I have been surprised to find that all of these institutions, Payments Council, Cheque and Credit Clearing Company Limited etc are all made up of, guess who? ….. the banks! They make the rules and administer the system and judge what is what. Also, the history shows that the system has changed every time a major problem arises and a new system brought in, however, it is always run – because it is paid for perhaps – by the banks.

My mum didn’t cancel the second cheque because the first one had cleared, she had no idea about clearing. She cancelled it because she was aware of the debacle with the bank during the previous week and was worried about her account. When she cancelled the second cheque I had not begun to do any research about clearing and I had no idea of the possible significance of the bank saying the cheque was cleared, she acted solely to protect her account. I had not told her until earlier this year that I am following this up. I only told her then as I wanted to see if I could get some details from her bank about when they had the cheque and they needed her to send in some authority to give me info on her account. She is otherwise unaware of this. I have now told her that I am taking a small claim.

Thank you for the offer of looking at the reply to the defence, that is appreciated. I’m a bit worried about posting it as the replies to date don’t seem to be focussed on the legal areas, the views seem to be more of the Financial Ombudsman Service type response, i.e. what seems ‘reasonable’. I agree entirely that my claim does not seem reasonable, but I expected that the facts should be what is examined by the court, not just the reasonableness of them.

I agree that I need to – and I think that I have – remained open-minded about the possible views but I haven’t really seen good legal arguments so far to dissuade me that my case is good (and also I need to get on and finish it). But I would really like some help to rationalise the arguments, so I will post after redacting.

Thank you for your info about costs. I hope that I could persuade a court that the claim has some merit. I acknowledge that there is a risk of costs.

thanks,

Nicola

[Nicola Bell]

Re: Can the bank ‘UNCLEAR’ cleared funds?

Hello Des8,

that is very helpful. The bank did initially ask for the case to be struck out but it does not seem to have followed this up. Do you have a reference for this, in case I should need it?

It is not clear to me whether the Defendant did delay over filing/serving Defence papers or what happened there, they certainly didn’t serve an acknowledgment of service to me on time, that’s all I can really say. I think the defence was in on time.

best wishes,

NB

[stevemLS]

Re: Can the bank ‘UNCLEAR’ cleared funds?

Hello Des8,

that is very helpful. The bank did initially ask for the case to be struck out but it does not seem to have followed this up. Do you have a reference for this, in case I should need it?

It is not clear to me whether the Defendant did delay over filing/serving Defence papers or what happened there, they certainly didn’t serve an acknowledgment of service to me on time, that’s all I can really say. I think the defence was in on time.

best wishes,

NB

The defendant is not required to do anything other than file the acknowledgement of service at court, the court is obliged to notify the claimant that it has been done. (CPR 10.4)

[Amethyst]

Re: Can the bank ‘UNCLEAR’ cleared funds?

earlier in the thread we went through the 2-4-6 issue and it does back up that under the T&C's the bank acted correctly.

http://www.co-operativebank.co.uk/bu...clearing-cycle

''Please note: Clearing days are equivalent to business working days and do not include weekends or bank holidays example – if T is Monday then T+2 is Wednesday or, if T is Friday then T+2 is Tuesday.''

Weds 5th - Deposit to post office
Thurs 6th -
Friday 7th - received at bank ( T day )
s
s
Monday 10th - 1
tue 11th - - T+2
wed 12th - 3
thu 13th - T+4
fri 14th - 5 -- credited account - ie shown as available to use.
s
s
mon 17th - T+6
tue 18th - can use funds and be sure they won't be taken out of the account if the cheque bounces ( still would owe the money but they couldn't just take it back they'd have to arrange for you to repay it)

The money was taken out on the 15th after the staff member said it was cleared - they have admitted that was an error and he should have said available, and apologised/recompensed for that error.

The bank removed the money on the 17th December - so on T+6

Second cheque was paid in Thursday 13th December and returned as unpaid on the 19th December - it didn't go to available balance just showed as pending on the account.

Thurs 13th - Deposit to Bank Branch (T-day)
Friday 14th -
s
s
Monday 17th - T+2
tue 18th - - 3
wed 19th - T+4 - money removed as unpaid
thu 20th - 5 - would have shown as available
fri 21st - T+6
s
s
monday 24th - could have used funds and be sure they won't be taken out of the account if the cheque bounces ( still would owe the money but they couldn't just take it back they'd have to arrange for you to repay it)

[Nicola Bell]

Re: Can the bank ‘UNCLEAR’ cleared funds?

Hello Ms M,

Thanks for your new comments and honestly no offence taken. I’m not taking this personally. I’m sorry if my response read with the emphasis that your emboldening shows, I didn’t mean to be at all heavy but I can see how you might think that it was. (Problem that I have in life general actually ). I’m happy that you have engaged with this and I was seeking more information so that I know what to address, sorry that it read worse than that.

I certainly didn’t take what you said as an accusation of any sort, I am just so surprised that anyone could consider it and wanted to know how that could happen to see if I have missed anything.

I fully acknowledge opportunism, I am an opportunistic person, I always have been and it has stood me in good stead, but see no problem in that per se. There is no clash with that and innocence in my book.

Thank you for the explanation that you have given. I agree that my mother needed to have no concern re paying the cheque twice as I would have refunded her money in good faith, however, her concern was that her account might go overdrawn, not that I would not repay her, we go back a long way!

Once I had done some research and read that the funds should be mine I did act quickly. I had done my research and then tried it to see if it could be true. I can’t see a problem with that. There would be no reason to wait once I had looked it all up and no reason to look it all up and then do nothing, would there? It wasn’t calculated beyond that. I was testing what I first considered nonsense, then found should be true and then found it was true.

I didn’t and don’t put a moral judgment on my intentions, obviously once I believed that the funds could be mine I acted in line with that belief, I still am acting in line with that belief in fact.

I’m sure you’re right about the age issue, it’s just that obviously I have a pretty good record (only one parking ticket etc.) to draw on now, mum too and I can see that no reason to suggest that I have done anything that is not within the law. I have lived my life broadly trying to stay within the law and would not consider doing anything fraudulently.

I do wholeheartedly believe that it is likely that the banks do this all the time, the rules say certain things and they will point to them when they need to but ignore them otherwise. I suspect if you rang the bank several times today (08000 284 284 - charges apply) and ask them what the Terms and Conditions were in relation to cheques clearing through the post office system you might get something similar to the list below (I have recordings of all of these).

I genuinely do appreciate your input and I can’t say I’m not a bit worried but on the other hand I am a supporter of the co-operative movement and I do feel that they, the ‘ethical bank’ should treat their customers fairly, me included, maybe after this case they will.

FTR, I haven’t actually had any compensation for inconvenience, I turned down the Ombudsman’s finding as I wasn’t happy with the result.

Oh dear, what worse construction could be put on this – especially by a ‘decent’ barrister?

Thanks again.

Nicola

1. Timescales for cheques paid in at the bank were represented as:

up to 7 working days (call no 3);
3, 5 or12 days (call 12/12/12 -13 mins)
10 days (call 12/12/12 ?)
10 working days ‘before they show on the account’ (call 13/12/12 3 mins)
10 or 12 days (call 13/12/12 4.10 mins)
7, 10 or 12 working days (call 13/12/12 15 mins)
10 days (Money Management)
7 working days (call 3 40 seconds)
7-10 working days (call 6 Money Management)
6 working days (call 10 1.50 Money Management)

[Amethyst]

Re: Can the bank ‘UNCLEAR’ cleared funds?

If you disagree with 2-4-6 terms as per the terms and conditions of the account - the other issue is that the argument you should be having is that the bank shouldn't have just taken the money. It would still be owed but they shouldn't have just taken it out of the account.

Also - there has actually been no loss.

31. As to paragraphs 24 and 25, as pleaded at paragraphs 6 (h) to U) above, as a result of the negative (overdrawn) balance on the Joint Account, interest of
£209.47 and charges of £55 were applied to the Joint Account and were subsequently refunded by the Defendant, once the Claimant had repaid the overdraft on the Joint Account. The Claimant has therefore suffered no loss.

You had £9000
Added £35000 - balance £44000
Withdrew £35000 - balance £9000
Added £35000 - balance £44000
1st cheque returned unpaid - balance £9000
2nd cheque returned unpaid - balance (-£26000)

You pay back in £35000 - balance goes back to £9000 ( less charges/interest etc which are later refunded )


Also 2-4-6 doesn't mean the funds are yours - it means the bank cannot just take them back from your account ----- unless you can show a reference otherwise.

So to the court you need to demonstrate Loss, and that the money was yours, to keep, on Saturday 15th Dec.