Alliance & Leicester - Breach of Contract claim

FazerWizz

I just thought I'd let you know about a claim I've just issued against A&L for charges brought about by them breaching their Terms and Conditions.

This is quite a specific problem, but it just might apply to others so I thought I'd let you know.

I also have an account with NatWest, who are part of the FastPay system. When I know I have a DD or SO going out of my A&L account, I transfer some money into it from Natwest using FastPay. Even though the money is transferred in and appears in my A&L account as available, A&L have returned the items due to be paid and charged me £25 for each one. This has happened about 5 times over the last year, but last week it happened with three small DDs in one day (£75!) so I took some time to very carefully study their Ts & Cs. I discovered that they clearly state money transferred via FastPay will be clear and available the same day.

When I took this up with A&L, they referred me to clause 24.2.2 which says:

“We require one clear Working Day before We will allow the cash payment to be used to make a direct debit, standing order, bill or cheque payment.”

I explained that this wasn’t a cash payment, it was a FastPay payment and that clause: 24.3.1 says:

“If a transfer of money is made into Your Account from another bank or from another account with Us, We will allow You to withdraw against the amount the same day the money is credited to Your Account.”

To further clarify, clause 24.3.2 gives a chart of timescales showing when money will be available and for FastPay it says: “Same Day”.

Faced with this evidence, A&L told me: “Well, we return items in the mornings and make credits in the afternoon so that's why they were returned” But nowhere in their Ts & Cs is that stated. Despite this, they refused to apologise to the payees with that the items were for and explain their error or to refund my charges, so today I’ve taken them to the small claims court. When I looked closer at my account I discovered that had they not done this the first time more than a year ago and charged me, my account would have been sufficiently in credit to avoid about £500 worth of charges, so I’ve sued them for the full amount and for consequential charges incurred with payees.

I’ll let you know the outcome of the court case but in the meantime, I hope this helps someone else.

natweststaffmember

FazerWizz wrote: »

I just thought I'd let you know about a claim I've just issued against A&L for charges brought about by them breaching their Terms and Conditions.

This is quite a specific problem, but it just might apply to others so I thought I'd let you know.

I also have an account with NatWest, who are part of the FastPay system. When I know I have a DD or SO going out of my A&L account, I transfer some money into it from Natwest using FastPay. Even though the money is transferred in and appears in my A&L account as available, A&L have returned the items due to be paid and charged me £25 for each one. This has happened about 5 times over the last year, but last week it happened with three small DDs in one day (£75!) so I took some time to very carefully study their Ts & Cs. I discovered that they clearly state money transferred via FastPay will be clear and available the same day.

When I took this up with A&L, they referred me to clause 24.2.2 which says:

“We require one clear Working Day before We will allow the cash payment to be used to make a direct debit, standing order, bill or cheque payment.”

I explained that this wasn’t a cash payment, it was a FastPay payment and that clause: 24.3.1 says:

“If a transfer of money is made into Your Account from another bank or from another account with Us, We will allow You to withdraw against the amount the same day the money is credited to Your Account.”

To further clarify, clause 24.3.2 gives a chart of timescales showing when money will be available and for FastPay it says: “Same Day”.

Faced with this evidence, A&L told me: “Well, we return items in the mornings and make credits in the afternoon so that's why they were returned” But nowhere in their Ts & Cs is that stated. Despite this, they refused to apologise to the payees with that the items were for and explain their error or to refund my charges, so today I’ve taken them to the small claims court. When I looked closer at my account I discovered that had they not done this the first time more than a year ago and charged me, my account would have been sufficiently in credit to avoid about £500 worth of charges, so I’ve sued them for the full amount and for consequential charges incurred with payees.

I’ll let you know the outcome of the court case but in the meantime, I hope this helps someone else.

Have you written to the bank to state you will be taking them to court, just so that you have followed the court protocols before issuing a claim.
Very interesting in my opinion as well.
Can I ask what case law you are using for this as well? Are you using misrepresentation act?

Premier_2

An individual that takes court action doesn't need to know what law they are claiming under - that's the other beauty of small claims; the judge will work that out on the evidence offered

If you specify the law, the judge may elect to try the case exactly as stated so unless you are a fully trained lawyer, best to not say.

onlypaddy

but, if OP does not state the law, then surely the case will be placed in the pile with other unauthorised overdraft charges?

FazerWizz

Yes I did write to them first and got a standard reply stating the clearing terms which I'd already read, none of which applied to these circumstances.

I'm suing them for a simple breach of contract. When I opened the account, we entered into an agreement, the terms of which are clearly set out in their Ts & Cs, which are published on their website. Those Ts & Cs clearly state that if you pay cash in, they require 24 hours before it can be used to pay a DD or SO. Immediately after that clause, it says that payments made using Faster Payments scheme will be available the same day. Nowhere does it say that if you transfer money in using Faster Payments, they require 24 hours extra before it can be used to pay a DD, as they do when referring to cash payments.

I have been to small claims against a few large companies who have treated me unfairly. Without wishing to tempt fate, I'm pleased to say so far I have always won. In each case, the decision seems to come down to what the judge thinks reasonable, after all, the judge is only human and were not setting a precedent here.

In this incident, I had cleared funds in the account on the day that they returned the DDs. Nowhere in their Ts & Cs does it say they require extra time before paying a DD, like they specifically do when referring to paying in cash, so it's hard to believe that any reasonable person would think it was fair for the bank to return items when cleared funds were available in the account. The defence they gave to me on the telephone was simply that they process the returns before they process the credits, but it seems crazy that they expect that to be a valid defence when it isn't mentioned anywhere in the terms of having the account, whereas other related conditions are specifically covered.

I hope the judge agrees with me if it gets that far. At least, they will have to file a written defence and I can examine it further; this claim cannot be stayed like the usual unfair bank charge reclaims have been as I'm specifically suing for breach of contract.

They have 2 weeks to file a defence or 4 weeks if they return the acknowledgement. I'll keep you posted.

Alpine_Star

A DIY book who's sales depend on it being flogged to the uninformed masses is not the best unbiased source of legal advice IMO.

FazerWizz

Well, I'm please to say I haven't broken my winning streak :dance:

Got a letter from A&L saying that thay have agreed to settle my claim in full, although they don't admit liability :mad:

I'm confident that they will be changing their Ts & Cs very soon, I'm sure they had no defense against this claim.

If you'd like to see a pdf of the letter received, you can get one from the link below (personal details removed). I hope if anyone else has the same problem this helps.


edit: Grrr - can't post a link. you can work it out from this:

www (dot) bikersoracle (dot) info/A+L.pdf