Bank Charges Reclaiming Guide discussion

dsl55 wrote: »

Hi, am new to the forum and was after some advice re claiming back bank charges from HSBC. These were accumulated over the last 5 years with the majority being 2008/2009 and total nearly £4000. We experienced financial difficulty leading to a DMP through the CCCS and eventually we successfully negotiated full and final settlements with all our creditors. During the time HSBC were unwilling to help with our overdraft at all which stood at £750 but we were consistently over it by up to £1000 and they were charging between £75 and £150 every month. Over the course of 2 years I contacted them 5 or 6 times asking for any kind of assistance that would stop the fees, even for just one month, in order to help get back into the black. It was only in Feb 2009 that I got a helpful person who said they could put in place a reducing balance agreement. They extended the overdraft to cover the balance as it stood and we agreed that it would reduce by £150 per month until zero. Provided I stayed within that agreement they would not charge me. From that day we stuck rigidly to the plan, did not defalt once and the overdraft is now clear.

My argument for claiming back is basically on 2 things, 1 that the charges were unfair and did not reflect the cost to the bank of my situation. But more importantly that they were essentially irresponsible. We can demonstrate that other creditors who helped us were paid etc and that once they did offer me some kind of solution that we stuck to it without fail and cleared our debt. If the had offered it 48 months prior when we first asked we would not have paid all those fees

What are my chances?!

Hi dsl55, and welcome to MSE :hello:

I would suggest that you read the article linked to in the OP if you have not already done so.

There are essentially two fundamental priniples on which you can attemptto reclaim bank charges (and I think you are hoping to hit on both, which is fine)

1. Financial Hardship
This is what the linked article is essentially about, although it refers to it as 'the human arguement'
The situation is that banks are not obligated to refund any charges on this basis, only to treat such complaints "positively and sympathetically". The reality is that unless you are currently in financial hardship, the banks will not deem an appropriate resolution to be giving any refund. If you were in financial hardship, the typical amounbt they will refund as a maximum (and it's not in every case) is about the previous 6 months worth of charges.
Each case is assessed individually.

You say you were in financial hardship in 2008/2009 and you complained to your bank then about the fees you were incurring.
If you received final responses to thoe 5 or 6 complaints you made at that time, I suspect you are now time out of taking the matter to the FOS. You could have taken the matter to the FOS withinh 8 weeks of making each complaint, and it you were truelly in financial hardship at the time,I would fully expected you to have done so if you felt the bank hadn't treated your complaint appropriately.

However, it seems you probably were dealt with appropropriately (at least on your last complaint) as a solution was agreed that allowed you to repay your overdraft.

2. Unfairness.
An allegation of unfairness can only be ultimately assessed by the courts. The second MSE article (link is in the first article) deals with how you can attempt this. Note that since the Supreme Court ruling in November 2009, the banks think they are completely within the law, and will vigourously defend any allegation of unfairness.
Chances of success? About zero. No one has yet reported any success in court following the advice given in the second MSE article. Even some of the legal firms such as the Govan Law Centre don't appear to have had any success in this direction since the Supreme Court ruling, despite their hopes otherwise about 6-9 months ago.

Got a Directions Hearing tomorrow at noon !!!

Barclays have just sent me this - any thoughts ?

DRAFT ORDER
UPON hearing the Claimant in person and the Solicitor for the Defendant
IT IS ORDERED THAT
1. the claim be struck out
2. there be no order as to costs
Dated: 18 March 2011

Also....

Barclays Bank PLC Defendant
DEFENDANT’S OUTLINE SUBMISSION
FOR THE HEARING ON 18 MARCH 2011

Introduction

1. This is a brief telephone hearing to consider whether the claim ought to be struck out as disclosing no reasonable cause of action or whether the Claimant should be given the opportunity to apply for permission to file and serve amended particulars of claim.

Background

2. This claim started out as one of the tens of thousands of standard bank charges claims that have clogged up county courts’ lists over the last 4 years. Accordingly it advanced, in very short terms, the bare claims under the Unfair Terms in Consumer Contracts Regulations 1999 (the “UTCCRs”) and common law penalties. In common with the vast majority of similar claims it was stayed pending the outcome of a test case, namely The Office of Fair Trading v Abbey National plc & others.

3. On 25 November 2009, the Supreme Court ([2009] UKSC 6) found in favour of the financial institutions which were party to the test case and it follows that the claim as it is currently formulated must fail.

4. However, the Claimant has, by way of a letter dated 08 February 2011, sought to oppose the court’s proposal to strike out the claim. The Claimant has failed to particularise the “two legal points” he refers to in his letter of 08 February 2011 but has sent the Defendant a letter dated 23 February 2011 (enclosed) which appears to set out the basis of the Claimant’s proposed amended claim.

5. The arguments set out in the Claimant’s letter of 23 February 2011 are, like his original claim, based on a template document available to download from the internet and it is respectfully submitted that each of the arguments set out in the Claimant’s letter of 23 February 2011 is misconceived, contrary to the decision and guidance of the Supreme Court judgment in the test case, and therefore the Claimant’s proposed amended claim has no prospect of success.

6. It is arguable that a 15 minute directions hearing is not the forum to consider the merits of the Claimant’s proposed amended claim but the following section is included to assist the Court in its deliberations on whether the Claimant’s proposed amended claim deserves any further consideration.

7. The gravamen of the Claimant’s proposed amended claim appears to be that the charges are unfair under the Unfair Terms in Consumer Contracts Regulations 1999 and/or the Consumer Credit Act 1974:

Unfair Terms in Consumer Contracts Regulations 1999:

8. The Claimant still seeks to argue that the Unfair Terms in Consumer Contracts Regulations 1999 support his claim for the return of his bank charges, despite the Supreme Court clearly ruling that these regulations cannot be used to assess the fairness of the charges. This is plainly wrong, and underlines the whole approach taken by the Claimant in this claim.

9. As is now well-known, the Supreme Court unanimously held that the bank charges are levied in exchange for a package of services supplied by the banks, and accordingly a challenge to the level of the charges falls within the exclusion set out in Regulation 6(2)(b) of the UTCCRs.

Consumer Credit Act 1974 and 2006:

10. The Claimant seeks to add a claim under the “unfair relationships” provisions of the Consumer Credit Act. In short, his claim would be that his entire banking relationship was made “unfair” as a result of the occasional levying of unauthorized overdraft charges.

11. First, this simple summary of this new argument shows what a high bar the Claimant has set himself and the inherent difficulty with this new argument.

12. Secondly, and more significantly, the OFT considered this alternative argument following the Supreme Court judgment. On 22 December 2009, the OFT, having consulted with various other public bodies (including the FSA) and other interested parties (such as consumer groups), announced that they would not be continuing its investigation into bank charges on the basis that the Supreme Court judgment did not leave any other potential basis of challenge which stood a realistic prospect of success. For the avoidance of doubt, the OFT considered the Consumer Credit Act challenge now sought to be brought by the Claimant:

“The OFT’s initial assessment is that there are not good grounds for concluding that a collective challenge alleging breach of these provisions [the unfair relationships provisions in the CCA] arising from the use of the Relevant Terms generally would have good prospects of success. This partly reflects an assessment of the wider repercussions of reasoning underlying the Judgment. This reasoning will inevitably be influential in guiding the deliberations of any UK court before which the OFT might bring enforcement action based on the concept of fairness.”

13. Therefore, the OFT themselves considered and rejected the new arguments set out by the Claimant, in particular any further arguments under the UTCCRs and new points under the CCA.

14. Thirdly, each of the Claimant’s new arguments has been shown to be incorrect either in the Supreme Court judgment or in the earlier Commercial Court decision in the test case. By way of example:

14.1. The Claimant focuses on the fact that the unauthorized overdraft charges are excessive in comparison with the costs or the level of borrowing. However, the Supreme Court agreed with the banks that that was not relevant: the bank charges are just part of the total charge for the entire banking services (debit card, ATMs, branches, cheque books etc).

14.2. The Claimant says that it is unfair that his charges may cross-subsidise other customers. Several of their Lordships, and Lord Mance in particular, demonstrated that this complaint was untenable. The OFT, in their paper after the judgment, agreed.

14.3. The Claimant complains about the alleged “complexity” of the charges or that they were “insufficiently explained”. The Supreme Court clearly rejected that argument too:
“While incurring the relevant charges is no doubt something that customers would like to avoid, it is a clearly explained and, objectively viewed, very important feature of the overall package. The OFT’s case that such charges are not ‘readily visible’ or ‘recognisable’ as the price is in my view untenable.” (Lord Mance at [114])

15. Therefore, as the OFT concluded shortly after the Supreme Court decision, and the bank respectfully submits, the Consumer Credit Act arguments have no prospect of success.

The Claimant’s other claim

16. The Claimant has a second stayed bank charges claim at Bradford County Court (7QZ55464). Although it seems that the charges which the Claimant seeks to recover in this other claim are different the legal arguments are identical.

Draft Order

17. If, despite the submissions at paragraphs 7 - 15 above, the court is minded to give the Claimant the opportunity to apply for permission to file and serve amended particulars of claim. The Defendant will respectfully request an order that:

17.1. in relation to each of his two claims, the Claimant make a separate formal application to amend his particulars of claim, to the relevant court, on notice to the Defendant and attaching the proposed amended claim form and/or particulars of claim on or before 01 April 2011;

17.2. the Claimant’s other claim be transferred from Bradford County Court to Keighley County Court;

17.3. the Claimant’s applications for permission to amend be dealt with together;

17.4. a hearing of the Claimant’s applications be listed for 2 hours on the first available date after 01 June 2011 (leaving enough time for the second claim to be transferred from Bradford County Court).

18. The preceding paragraph is set out for the assistance of the Court and should not be seen as an acceptance by the Defendant of the Claimant’s contention that the Court’s proposal to strike out the claim is incorrect.

Conclusion

19. Accordingly, it is respectfully submitted that the claim should be struck out.

LozBingley wrote: »

...Do I start again?

My response given in other thread here:

http://forums.moneysavingexpert.com/showthread.php?t=2119417&page=9

A Glimmer of Hope post the Supreme Court decision.

http://forums.moneysavingexpert.com/showpost.php?p=42173696&postcount=1