Unfair Terms and Conditions - Court Action MBNA

taktikback

Firstly, I accept I'm going to get a beating from the posters who will say, "you didn't comply with their T+Cs, it's your own fault - so you don't have a prayer"

Well - I fell into the usual trap of making a mistake in changing a standing order in respect of a changed payment date by MBNA last year. £270 odd interest (retrospectively applied as per their T+Cs -loss of 0% promo rate plus the loss of £420 of handling fees....

I've tried the Ombudsman, who has basically said - it's their T+C's and that they have no regulatory powers (which surprised me..) to challenge them.

So I've taken them to court (Money claim on-line). They have declared they will lodge a defence, but I have no details at this stage - It will go to my local county court.

You may say, I'm mad pursuing this, but I genuinely believe that MBNA cynically exploit their T+Cs to trap people like me. I could put it down to experience...but I want to see it through, because I don't believe organisations should be allowed to operate in this way.

Question is - does anyone have any experience of going down this route? - and what happened?. Is it just a case of MBNA trying to use their corporate muscle to frustrate any attempt to challenge them by giving their customers the run around?...or will they ultimately engage in a challenge to the way they communicate and enforce their T+Cs?

natweststaffmember

I have got to say that my first initial reading of paragraph 1, I was with you all the way. BUT, when you mentioned what you were doing then I thought, oh my god, he's not doing that is he? As I read on, I see you are.
OK, what case law are you using and if it is UTCCR 1999 which part are you using?
Are you claiming any of the charges for a late fee?
I personally think that it maybe a foolhardy claim HOWEVER, see the questions above and I really want you to prove me completely wrong for your sake.

taktikback

Thanks for the reply!

Can't say I've got as far as quoting the case law. I'm generally aware that legislation relating to unfair terms and conditions exists. At this point I've made a general claim through moneyclaim online based on the simple principle that I was charged £420 in handling fees to secure a 0% deal that was defaulted soon after. Hence, I have been effectively denied the goods I paid for -hence suffering a loss.

I also claimed for the interest applied on the basis that this is charged from the beginning of the statement period - a period before the technical default occured - hence it is retrospective and unavoidable even if I had paid immediately on default. The point is that this is unreasonable and disproportionate.

I had a charge of £12 applied for the default - I have not disputed that because it is reasonable .

The only reason the whole sorry saga occurred is because MBNA changed the payment date, prompting an adjustment by me to my standing order - but I am not arguing that as unfair in principle.

I know I have transgressed the technicalities of the T+Cs but I cannot accept that the response by MBNA reflects the costs they have incurred, therefore it is punitive in my view.

I understand that as they have lodged a defence, I now have to fill in another form, presumably to detail the legal basis of my case should I wish to pursue it.

I owe them nothing, - they continue to offer me 0% for 10 months on both of my accounts with 3% handling fees (4% if transfered to a current account -a sneaky new piece of small print)

I will never use any of their services again on principle - but that is not the point - I would like my £700 back (including £60 court fee for bringing the action). And if it helps other people to stand up to them or put pressure on the system to be more transparent or, dare I say it - fair - I would be prepared to invest a little more money if need be.

Or maybe I should just get over it and walk away, which would suit them fine.

MarkyMarkD

The £420 fee entitles you to a 0% deal if you pay in accordance with the terms. You didn't.

I don't see any reason at all why you should win.

If you had paid your minimum payment by DD like any sensible person, you would not have missed the payment date.

taktikback

When people were getting charged £32 for going overdrawn, the authorities ruled that this was disproportionate to the costs being incurred by the banks for dealing with such a transgression - hence the charge was universally reduced to £12 because that was deemed reasonable

How can one,two day late payment on an account, with a newly set up 0% transfer deal and a £14000 balance, trigger a charge of £270+£12 default plus the loss of the £420 handling fee paid,reasonably claim to be proportional to the costs incurred by MBNA for administering such an event?

Orford

Can you post up the POC's you filed at MCOL

YorkshireBoy

taktikback wrote: »

When people were getting charged £32 for going overdrawn

I assume you mean overlimit and/or paying late, being as the 'ruling' applied to credit cards?

hence the charge was universally reduced to £12 because that was deemed reasonable

Two points; Firstly it wasn't universally reduced to £12. Egg et al have set their default fees at £16, being as they have "exceptional business factors". Secondly, £12 wasn't deemed reasonable. Instead, anything over £12 (or possibly higher in the case of those with "exceptional business factors") would likely be challenged by the OFT on the basis that it wasn't reasonable.

Not being pedantic, but if you're going to court you need to understand the facts so you appear knowledgable.

How can one,two day late payment on an account, with a newly set up 0% transfer deal and a £14000 balance, trigger a charge of £270+£12 default plus the loss of the £420 handling fee paid,reasonably claim to be proportional to the costs incurred by MBNA for administering such an event?

They will argue you were using credit that could have been allocated to another customer more profitably.

They will argue they give you up to 50/56 days to pay. A judge may feel this is a reasonable period and that it's not reasonable to ignore the bill (which is what you've done at the end of the day being as you weren't struggling...because if you were you'd have made contact with them).

Two questions:

What about the deferred payment schemes (ie buy now pay later)? You can get a £1,000 piece of furniture now and pay for it in August 2010. If you don't pay for it by August 2010 they'll whack on 29.9% APR meaning you immediately owe £1,299. Is that fair? I'd argue it is (and so would the credit provider) being as it's clearly detailed in the agreement. And crucially it doesn't come under the classification of penalty fees.

What if you win your case? You'll single-handedly bring about the end to introductory 0% offers and deferred payment schemes. That would be some achievement!...but I don't think it'll happen because you aren't going to win (in court...you may win out of court though (with reinstatement/retribution), which is what I think you're hoping for?).

taktikback

OK - not sure how an argument based on what they could have been charging another customer helps them demonstrate they are being reasonable, but yes, they may have been able to lend out at a different rate

I struggle with the 50/56 days to pay argument - this was a 0% balance transfer - effectively paid for by the £420 handling charge - I would argue that on that basis, a minimum repayment during the 0% period is merely administrative from their point of view, and effectively reduces the value of the 0% transfer by reducing the amount outstanding during the period

I didn't by any stretch of the imagination "ignore the bill" - I changed the standing order (incorrectly by 2 days as it happens) due to their change in payment date (the first time in 10 years that has ever happened)

Your furniture argument is a good one - it is a similar type of trap set for the unwary. Ok that might be an argument supporting their charge of £270 interest, but the loss of the £420 handling fee is equivalent to the company charging £1299 plus repossessing the sofa

If I won the case, it doesn't mean the end for 0% deals unless you are suggesting that the business case for offering them is so that they are funded by unfair charging.

If they settle out of court - of course I would be pleased - and you're right, they probably wouldn't risk a test case, but if it helps them realise that customer service and reasonable behaviour is a better long term policy than short term opportunism then maybe we would all benefit...and unless people let them know they won't just roll over..why would they bother to change?

Also to "Oxford" - what was it you wanted me to post.? I have access to a PDF of the claim as filed online, but obviously it contains personal details,so I can't post it as is. But I can give you some more specific details if you want

taktikback

OK - not sure how an argument based on what they could have been charging another customer helps them demonstrate they are being reasonable, but yes, they may have been able to lend out at a different rate

I struggle with the 50/56 days to pay argument - this was a 0% balance transfer - effectively paid for by the £420 handling charge - I would argue that on that basis, a minimum repayment during the 0% period is merely administrative from their point of view, and effectively reduces the value of the 0% transfer by reducing the amount outstanding during the period

I didn't by any stretch of the imagination "ignore the bill" - I changed the standing order (incorrectly by 2 days as it happens) due to their change in payment date (the first time in 10 years that has ever happened)

Your furniture argument is a good one - it is a similar type of trap set for the unwary. Ok that might be an argument supporting their charge of £270 interest, but the loss of the £420 handling fee is equivalent to the company charging £1299 plus repossessing the sofa

If I won the case, it doesn't mean the end for 0% deals unless you are suggesting that the business case for offering them is so that they are funded by unfair charging.

If they settle out of court - of course I would be pleased - and you're right, they probably wouldn't risk a test case, but if it helps them realise that customer service and reasonable behaviour is a better long term policy than short term opportunism then maybe we would all benefit...and unless people let them know they won't just roll over..why would they bother to change?

Also to "Oxford" - what was it you wanted me to post.? I have access to a PDF of the claim as filed online, but obviously it contains personal details,so I can't post it as is. But I can give you some more specific details if you want

YorkshireBoy

taktikback wrote: »

I didn't by any stretch of the imagination "ignore the bill"

You quite clearly ignored the bit that said "payment due by xx/xx/xx". If you'd checked your statement you'd have seen it.

They will argue that you thought this was a 'set up [the SO] and forget' (for 12 months) operation requiring £25 per month so didn't bother checking the statements each month.

Payment due dates change for various reasons; number of days in the month, weekends, bank holidays, and T&C changes (eg a reduction from 56 to 50 days).

Paying by SO is always going to be a gamble unless you're on the ball...as you, and others reading of your plight, now know.

BTW, I don't think a precedent can be set in the small claims court, so no worries about them pulling the 0% deals? Phew!

natweststaffmember

Orford wrote: »

Can you post up the POC's you filed at MCOL

Can you type them out please?
From my initial reading, I think you chose the wrong route and in all honesty from what I have read so far, I think you have a less than 50% chance of success. Using MCOL is not for chancing your hand but for a clear and detailed argument. Sorry to be blunt but the issues around the Standing Order MIGHT be where you should have gone on this or the changing of the payment date. It might be redeemable but you are more than likely going to have to amend the particulars of Claim which wll cost you money you cannot reclaim. Let's see the POC first and we will see.