Can the bank ‘UNCLEAR’ cleared funds?

[des8]

Re: Can the bank ‘UNCLEAR’ cleared funds?

I'd quite like to see the defence SoC

Snap, but I think Sharon has seen it

[MissFM]

Re: Can the bank ‘UNCLEAR’ cleared funds?

My own view is that Nicola is on a perilous course and that des (apologies) is wrongfully encouraging her down that track.

I would like to see the "defence" which seems not to have been posted but which is being discussed.

Again, purely my view, but I think a DJ will dismiss this claim in seconds if they have properly read into it.

Is this not it? (198)

http://www.legalbeagles.info/forums/...ed-funds/page8

[MissFM]

Re: Can the bank ‘UNCLEAR’ cleared funds?

[QUOTE=des8;561354]

]Do you not think that the elegance of the argument, were it correct, mightn't be getting in the way of seeing the anomalies here though? :decision:

But it is correct isn't it?

Well, clearly I don't think so!:deadhorse

[Nicola Bell]

Re: Can the bank ‘UNCLEAR’ cleared funds?

hi,

thanks for all the posts and yes the defence was posted earlier as per MissFM's reference.

There's a lot to catch up here on but firstly, thank you for the concerns expressed for me but please don't worry about anyone else having any responsibility for wrongly encouraging me, I take full responsibility for my own actions and decisions and whilst Des8's views have been particularly important to me I welcome all views and know that nobody (including me) thinks it is particularly likely that I will win (this is different to thinking that I am right lol), so I am proceeding in the full knowledge of that. The balance on the site is clearly to be cautious, (though I can't quite see how that works in this situation) but this is purely my responsibility, please don't try to influence Des8 in any way for expressing his view, it is as legitimate as all of our views and he has an equal right to express it freely and without taking any responsibility for my decisions or actions.

Thanks Miss FM for your full contribution.The T&C's say "When you pay a cheque into your account you will have to wait a maximum of four Business Days after the Business Day it has been paid in before you can withdraw the money. If you pay a cheque into your account via a Post Office® the payment into your account will be delayed by up to two Business Days and, therefore, you will have to wait a maximum of six Business Days after the Business Day it has been paid in before you can withdraw the money".

Originally I thought that this meant that Certainty of fate could have been 8 days after deposit, but it is only the 'payment into the account' that can be delayed, this does not mean that the bank has an extra 2 days for clearing, only a bit of extra time to put it on the account. In this case of course it took not 2 days but 7 days.

I'm not sure Miss FM why you think that the Certainty of Fate becomes irrelevant if the cheque bounces, there is no evidence to support that view that I am aware of?

The other thing is that the Certainty of fate principle was not, as you suggest, set up to protect consumers against loss. I've read the background reports and the reason for the Certainty of fate principle was to provide certainty to everyone in the banking world and it is agreed and operated internationally. It is just a deadline with consequences and few exclusions. There is definitely no exclusion just because a cheque bounces, in fact the whole point of it to make the bank check out these things quickly.

When Miss FM you say "“The Co-operative reckons that the funds you withdrew were the proceeds from the second cheque and that you withdrew them only two days after it was deposited," I have never been told that by the bank or by the Guardian. I don't think the bank ever said that.

I can't see personally how the bank could have a claim for its own loss caused by its mispredicted action against me or my mum but perhaps you could say how that could work?

Finally, I don't understand your rationale with the T timetable and again the bank has never claimed that the funds were cleared for value.

Thanks for your thoughts,

best wishes,

Nicola

[Amethyst]

Re: Can the bank ‘UNCLEAR’ cleared funds?

The bit of the defence from the bank that I disagree with is underlined. Nicola disagree's with the same point, however Nicola and I disagree on when T is. I believe T, under the terms of the account, should be the 7th ( the two business days allowed under the terms of the account for the cheque to reach the bank) and Nicola believes it should be the 5th (the date the cheque was given to the Post Office )

My way, under the terms, the cheque would have reached 'certainty of fate' on the 17th - the day on which the cheque was returned unpaid and the money withdrawn, T+6 being the last day on which the bank could remove the funds without consent.

If you pay a cheque into your account via a Post Office® the payment into your account will be delayed by up to two Business Days and, therefore, you will have to wait a maximum of six Business Days after the Business Day it has been paid in before you can withdraw the money"

Nicola's way the cheque would have reached certainty of fate on the 13th - the day before she withdrew the money and 4 days before the bank took the money back out of the account.

It may be the banks way is correct, and T isn't until the cheque reaches the account (ie the day it shows on the account, but isn't yet available) however that is not allowed for under the terms of the account - so that is where I believe their defence falls down.

We're never going to agree on that so I'm not arguing it any more lol.

22. As to paragraphs 12 and 13, it is not admitted what investigations the Claimant undertook and the Claimant is put to strict proof as to the outcome of those investigations. It is admitted that there is a principle known as "Certainty of Fate". However, for the following reasons it is denied that the funds deposited by the First Cheque were the Claimant's to keep under the Joint Account terms and conditions or because of the Certainty of Fate principle.

Whilst the First Cheque was deposited at the Post Office on 5 December 2012, it did not arrive at the cheque clearing centre until Thursday 13 December 2012.

The Defendant has been unable to establish the reasons for this delay. The First Cheque then credited the Joint Account on Friday 14 December 2012 (being "T+2" the second day of the clearing cycle). The First Cheque would therefore not have been fully clear until "T + 6", four business days later, being after close of business on Thursday 20 December 2012.

These timescales are consistent with those published on the Cheque and Credit Clearing Company website. As pleaded at paragraphs 6(b) and 6(e) above, the First Cheque was cancelled by the Claimant's mother on 13 December 2012 and returned unpaid from the Joint Account on 17 December 2012. The terms and conditions for the Joint Account provide that at the end of six business days (being after close of business on 20 December 2012), the cheque is cleared (clause 2.2).

[Amethyst]

Re: Can the bank ‘UNCLEAR’ cleared funds?

btw - I am in communication with paymentsuk about that document we can't get that Ray Cox QC refers to in his article. So far we're disagreeing that

The rules are member and participant rules and would have little relevance for a non bank/ member of the public.

[Nicola Bell]

Re: Can the bank ‘UNCLEAR’ cleared funds?

hi Amethyst,

thanks for your post and I'm pleased and interested that you have contacted the payments council. I contacted them before and didn't get very far. I did discover though that they are, in the main, composed of (and I understand completely funded by) the banks and (if they thought about it at all) would be well aware of the implications of this issue for their members, that might feed some of the apparant lack of transparency to us simple mortals who can't really be able to understand complex documents.

Just to clarify the dates, I didn't take the money out on the 'day after the 13th' I took it out on the day after the 14th, which in calendar terms was the 15th but in banking terms (and on my statement) is the 17th. In fact looking at the latest copy of the statement they sent under the disclosure shows the returned 'unpaid' Ł35,000 listed before the withdrawal of the Ł35,000.

best wishes,

Nicki

[MissFM]

Re: Can the bank ‘UNCLEAR’ cleared funds?

hi,

thanks for all the posts and yes the defence was posted earlier as per MissFM's reference.

There's a lot to catch up here on but firstly, thank you for the concerns expressed for me but please don't worry about anyone else having any responsibility for wrongly encouraging me, I take full responsibility for my own actions and decisions and whilst Des8's views have been particularly important to me I welcome all views and know that nobody (including me) thinks it is particularly likely that I will win (this is different to thinking that I am right lol), so I am proceeding in the full knowledge of that. The balance on the site is clearly to be cautious, (though I can't quite see how that works in this situation) but this is purely my responsibility, please don't try to influence Des8 in any way for expressing his view, it is as legitimate as all of our views and he has an equal right to express it freely and without taking any responsibility for my decisions or actions.

Thanks Miss FM for your full contribution.The T&C's say

"When you pay a cheque into your account you will have to wait a maximum of four Business Days after the Business Day it has been paid in before you can withdraw the money. If you pay a cheque into your account via a Post Office® the payment into your account will be delayed by up to two Business Days and, therefore, you will have to wait a maximum of six Business Days after the Business Day it has been paid in before you can withdraw the money".

Originally I thought that this meant that Certainty of fate could have been 8 days after deposit, but it is only the 'payment into the account' that can be delayed, this does not mean that the bank has an extra 2 days for clearing, only a bit of extra time to put it on the account. In this case of course it took not 2 days but 7 days.

I think your first interpretation is correct. I also think you continue to confuse "cleared for value" with "cleared for fate".

I'm not sure Miss FM why you think that the Certainty of Fate becomes irrelevant if the cheque bounces, there is no evidence to support that view that I am aware of?

Sorry, that's not what I meant at all. In the case of cheque#1, it was cancelled before the end of T6 with the knowledge and agreement of all three parties (you, your mother, the bank). Hence it dropped out of the equation and could never have been cleared for fate. Any subsequent credit to your account in respect of that cheque would be a simple bank error.

-IF neither you nor the bank had agreed to/been aware of the cancellation, you would IMO have had a viable argument
-IF you had been aware of the cancellation but not told the bank, any argument you had would have been compromised by the appearance of fraud

The other thing is that the Certainty of fate principle was not, as you suggest, set up to protect consumers against loss. I've read the background reports and the reason for the Certainty of fate principle was to provide certainty to everyone in the banking world and it is agreed and operated internationally. It is just a deadline with consequences and few exclusions. There is definitely no exclusion just because a cheque bounces, in fact the whole point of it to make the bank check out these things quickly.

When Miss FM you say "“The Co-operative reckons that the funds you withdrew were the proceeds from the second cheque and that you withdrew them only two days after it was deposited," I have never been told that by the bank or by the Guardian. I don't think the bank ever said that.

Not my words, but a quotation from this article by Anna Timms of the Guardian in response to your query:
http://www.theguardian.com/money/201...30/coop-cheque (sorry, it was 2013 not 2014). Not suggesting one should believe everything one reads in the papers, but it was presumably taken from enquiries made to the Co-op in order to get a balanced view of your situation. I'm curious as to why you have, more than once, said that you were unaware of both the article and its contents?

I can't see personally how the bank could have a claim for its own loss caused by its mispredicted action against me or my mum but perhaps you could say how that could work?

Another misunderstanding - what I was hoping to have said was that, should you lose your case, the courts would have the discretion to award all the banks costs (legal fees etc.) against you.

Finally, I don't understand your rationale with the T timetable and again the bank has never claimed that the funds were cleared for value.

I am in agreement with Amethyst's view of the T timetable.

As for never saying "cleared for value", without seeing the transcripts from the phone calls it would be speculation as to where misunderstandings could have arisen. But it's my suspicion that they simply said "cleared" meaning in their terms "for value" but in your mind "for fate".

Thanks for your thoughts,

best wishes,

Nicola

Comments in blue above.

Just one other observation:

It makes no sense to say the transaction day is the day the cheque is handed, in a sealed envelope, to the PO. There could be anything - or nothing - in the envelope. The PO simply records delivery and then passes it to the clearing centre, where the envelope is opened, the contents recorded and the transaction begins.
I believe that some banks now have an arrangement with the PO whereby money can be paid in as part of the clearing cycle (ie begin the T business), but not the Co-op, AFAIK, then or now. So your payment into the PO would count as Tminus1 or Tminus2 with T 0 being the day the envelope is opened and processing begins, T + 1 the next day and so on.

If you are going into this with your eyes open, as you say, then it will be facinating to see what the court makes of it. :washing:

I think your case is helped by the fact that the bank's defence looks as if it were written by the office cat. x

[Nicola Bell]

Re: Can the bank ‘UNCLEAR’ cleared funds?

whew, lots to look at!

The main point is perhaps defining T.

When you think about it there has to be some point at which the customer and the bank agree the cheque is transacted, we would say 'paid in', i.e. passed from the customer to the bank. For the customer, this has to be the day that they part company with the cheque and receive a receipt for it. The customer has access to no other record of the cheque once they have parted with it, that is why this must be the transaction referred to as T. I accept that a situation could arise where an empty envelope is sent to the bank whilst a receipt is obtained by the customer at the post office. There is no suggestion that this happened in this case so is not directly relevant, but, one has to assume that the bank has a simple adminstrative procedure to deal with that situation, it must happen all the time. However the envelope (and the receipt) is clearly marked with the sort code and account number and so if there was an empty envelope presumably the bank would notify the account holder and record that.

I guess we would all agree that if you pay a cheque in at a branch before the cut-off point for the day, the relevant T=0 (i.e. the 'transaction') date is the date on the receipt that the customer is given on their paying-in book or credit slip. However, I understand that cheques paid in at a branch also get lost between the branch and the clearing centre. They can apparently get caught in sacks, slip behind desks, get caught in a machine etc. However, we would probalby agree that any such loss or any consequent delay does not alter the date of T. The date of the transaction itself is not affected by what happens afterwards. If that is the case with a branch, why would it be different with a payment to the post office? It is not reasonable for the customer to have no independent knowledge or evidence of the transaction date. The bank will have a service-level-agreement with the post office about the delivery of such envelopes and no doubt their own penalty clauses if there was a delay caused by the post office.

I don't think I am confusing cleared for fate and cleared for value, don't forget the bank says that the 14th was only T+2 and this would not be cleared for value even if you had paid in at the branch. If you pay at a branch you are cleared for value at T+4 and if you pay at a post office you are cleared both for value and cleared for fate after T+6. If, as the bank says the 14th was T+2 then it would not be cleared for value until the 18th at the earliest, so how would you explain that I was actually able to withdraw the money?

With the Guardian, I wrote to them and they subsequently published their story without telling me the result of their enquiry or that they were going to use it as a story and I didn't see it in the paper. (I'm sure you know me well enough by now to know that I would not have missed an opportunity to contribute openly to that thread if I had seen it :tinysmile_twink_t2. As I only read about the article on this thread I don't know what the bank told the Guardian, I can only say that the bank has never said to me that I tried to take the money from the second cheque, the bank told me that the first cheque had cleared and that is what I acted on.

I don't understand what you mean when you say Hence it dropped out of the equation, It seems that after the bank was told on the 13th that the cheque had been cancelled they presented it to my mum's bank anyway. If something had gone wrong with the process at my mum's bank too and the cheque had not been stopped, presumably it would have been paid, so it had not dropped out of the equation, they don't seem to have the independence to drop out.

I acknowledge that the court could award costs against me (but obviously I hope they will think that this is a reasonable case and whatever decision they arrive at that they won't think that I have acted in bad faith and the bank in good!) but we will see.

best wishes,

Nicola

p.s. so, are you fond of office cats??

[des8]

Re: Can the bank ‘UNCLEAR’ cleared funds?

Regarding points made today,
i)When a bank uses the term "cleared" it means the cheque has completed the clearing system.
If "special clearance" is requested it could be in as little as three days.
When "cleared", funds from a cheque have reached certainty of fate
Prior to that Funds may be "available", but are not certain and may be recalled by paying bank
We can't have a situation where the "experts" use a term with any meaning they desire to give it. (a la Humpty Dumpty in Through the Looking Glass) hence if the banks say cleared the funds are cleared not just available

ii) Transaction day is the day that the cheque deposit appears as a credit on the account. This is normally the day the cheque is paid in at the branch.
If paid in at the PO T day may be delayed by one or two days. If the Co op delay longer than two days they are in breach of their terms and conditions, and so in breach of contract

Although much has been written today, IMO most of it is a rehash of what has gone before.

I think that more help might come from discussing the import of this line from the bank's defence: " It is also admitted that the Bank mistakenly told the Claimant that the First Cheque had cleared". "Mistakenly" qualifies the verb "told", not the clause "that the first cheque had cleared", so was there a commercial decision to clear the cheque which was communicated to the depositor earlier than intended? Remember several persons of varying seniority confirmed the clearance and were the ones to introduce knowledge of certainty of fate. This is the mis-prediction which Nicola refers to and claims support from the Privy Council decision Dextra Bank & Trust Co. Ltd v Bank of Jamaica (Jamaica0[2001]UKPC 50 (26 November 2001) where their Lordships quote from Birks, Introduction to the Law of Restitution. Was this a mis-prediction as to what would come into existence when the second cheque was presented for payment to the issuing bank?
At least I think that is what Nicola was getting at.

[Nicola Bell]

Re: Can the bank ‘UNCLEAR’ cleared funds?

yes, spot on, thanks Des8, that is the Dextra case (http://www.bailii.org/uk/cases/UKPC/2001/50.html), I haven't read all of it but I will be away until 31st July and will try to read it if I can.

I'm not sure about your take on the definition of 'T' though, can you tell me why you think T is when it shows on the account rather than when it is deposited somewhere. I'm sure I've read that it is when the cheque is 'deposited' or 'paid in', (these terms seem to be used interchangeably). Or maybe a better question is, would it make any difference anyway?

I also agree with your well-phrased explanation of the 'mistakenly told' quote. Dextra it also talks about 'mistakes of facts' and that may be useful too.

best wishes,

Nicki

[Amethyst]

Re: Can the bank ‘UNCLEAR’ cleared funds?

I guess we would all agree that if you pay a cheque in at a branch before the cut-off point for the day, the relevant T=0 (i.e. the 'transaction') date is the date on the receipt that the customer is given on their paying-in book or credit slip. However, I understand that cheques paid in at a branch also get lost between the branch and the clearing centre. They can apparently get caught in sacks, slip behind desks, get caught in a machine etc. However, we would probalby agree that any such loss or any consequent delay does not alter the date of T. The date of the transaction itself is not affected by what happens afterwards. If that is the case with a branch, why would it be different with a payment to the post office? It is not reasonable for the customer to have no independent knowledge or evidence of the transaction date. The bank will have a service-level-agreement with the post office about the delivery of such envelopes and no doubt their own penalty clauses if there was a delay caused by the post office.

I agree with you completely, other than I'm saying that paying it at the post office is different to paying in to a branch. If you pay in at a branch it should show on the account the same day. If you pay in at the post office it doesn't show for two days ( unless they lose it lol) - therefore T is the day it shows. That's why I think their defence falls down, they should be arguing T is the 7th - for exactly the reasons you state above.

Also ''mistakenly told'' - I do think you are reading far to much into that - he ( the bank call centre blokey) was mistaken in telling you the cheque had cleared, his mistake was saying cleared instead of available. It wasn't a mistake to tell you the cheque had cleared because it had but they were hiding the fact from you...it was a mistake to tell you the cheque had cleared because it hadn't and they should have told you it was available for withdrawal as opposed to cleared.

[Nicola Bell]

Re: Can the bank ‘UNCLEAR’ cleared funds?

hi Amethyst,

I've posted my evidence to show that the cheque had cleared, I'm not sure that there is any evidence that it hadn't - (but I might have missed something). The bank has never actually denied that the cheque cleared.

I agree that it takes extra time to show on the account if paid in (or deposited) at the post office, however, that doesn't seem to change the date of T, (anymore than it would if the cheque went missing between the branch and the clearing centre). I also agree that their explanation of T is inconsistent with letting me take the money out and the fact of being able to withdraw the money (especially such a large sum) is surely more powerful evidence as to the fact of the matter?

[des8]

Re: Can the bank ‘UNCLEAR’ cleared funds?

- he ( the bank call centre blokey) was mistaken in telling you the cheque had cleared, his mistake was saying cleared instead of available. .

If only one or possibly two people had said this I would agree completely.
However several (including senior) staff told Nicola her funds had "cleared". I believe she had discussions with them at this time which is when certainty of fate reared its head!. (I haven't checked back thru' the thread to see exactly how many so open to correction)
Now this would indicate the staff need re educating as they don't know the difference between "available" and "cleared"
OR it indicates the funds were cleared.
Now did all the staff make a mistake, or were the funds marked as cleared because the bank had taken a commercial decision to clear the funds on the expectation of one or the other cheques actually clearing. When both cheques were stopped (due to bank's action) the bank reversed the clearance.
They then claim it was a mistake to advise the claimant a cheque was cleared.
Now is the mistake in advising the claimant, or in actually clearing the cheque?

From Nicola: "can you tell me why you think T is when it shows on the account rather than when it is deposited somewhere."

OFT Customer Promise Maximum Timescales

T = Transaction day

The day a cheque deposit will appear as a credit on your account.

Can't access it on defunct OFT website, but is quoted on many sites (including Coop http://www.co-operativebank.co.uk/bu...clearing-cycle)

[MissFM]

Re: Can the bank ‘UNCLEAR’ cleared funds?

Nicola: The main point is perhaps defining T.

http://www.chequeandcredit.co.uk/res...s/-/page/2099/
How can I make sure my bank receives my cheque as quickly as possible?
The simplest way is to ensure the cheque is paid in at your bank before their advertised daily cut-off times. You can pay in a cheque in a number of other ways - such as at a cash machine (at some banks), by post or at a Post Office. However, these may all affect when your bank actually receives the cheque and the timescale starts. If you are not sure when day 6 has passed you should check with your bank.

Or as Des repeats in post 359 above. For cheque#1, T would be the 7th.

Nicola: don't understand what you mean when you say Hence it dropped out of the equation,

I mean that the cheque became worthless, like a dud fiver.

i) Des: When a bank uses the term "cleared" it means the cheque has completed the clearing system.

"Clearing for fate or cleared for fateThe point at which funds from a cheque have cleared, the cheque can no longer be returned unpaid and the payee can be certain the money is theirs (unless they are a knowing party to a fraud).

Clearing for value or cleared for valueFrom a beneficiary’s perspective this is the point at which funds deposited by cheque start earning credit interest or, if the account is overdrawn, start reducing the balance of the overdraft. Although included in the account balance and shown on the statement or cash machine slip, the funds may not yet be available to withdraw.
Clearing for withdrawal or cleared for withdrawalWhen funds deposited by cheque are available for withdrawal from the beneficiary’s account (either as cash or to fund another payment from the account). The ability to withdraw is subject to the overall status of the account (e.g. the balance after the withdrawal remains within an agreed overdraft limit, or daily cash withdrawal limits). At this stage the cheque may still be returned unpaid and the beneficiary bank may still reclaim the money from the cheque until clearing for fate has been reached."
From http://www.chequeandcredit.co.uk

I should have said "cleared for withdrawal" but different sources use different terminology (believe it or not) - the point being that there ARE three different categories of "cleared" and banks often DO refer to cheques cleared for withdrawal (customarily on T4) as simply cleared.

The Co-Op seems to dwell on T4 as cleared (meaning for withdrawal). Don't know whether this is a help or a hindrance to your case, or even relevant, now that the timescale is no longer your preferred argument:

http://www.co-operativebank.co.uk/global/glossary
Cleared
Cheques and cash paid into your account need to be cleared before their value is added to your cleared balance.
Cash paid in is available by the end of the day if you use a slip at a Co-operative Bank branch, it is available immediately if you use your ATM/Debit/Electron card at a UK Post Office or Co-operative branch and should be available in 4 working days if you use a slip at a UK Post Office.
For cheques, including those paid in at a Co-operative Bank branch you should allow up to 5 working days. If you post us a cheque, you should allow up to 5 working days from the day the cheque is paid into your account. You should allow up to 6 working days if you pay in at a UK Post Office. Add one additional working day to the above timescales for cheques drawn on or paid into a Scottish/Northern Ireland Bank."

However, :hand: moving on..

Nicola: yes, spot on, thanks Des8, that is the Dextra case (http://www.bailii.org/uk/cases/UKPC/2001/50.html), I haven't read all of it but I will be away until 31st July and will try to read it if I can.

Do you not think it a tad unwise to use it in your court claim before reading it? :confused2:
x