Help need with the ongoing HSBC refusal to pay charges

mo1710

Following the long battle with HSBC, for which I’ve been through all the process mentioned herein going back to 4 years ago, I’m yet to get anyway and starting to believe it is time to throw the towel.

The latest letter from HSBC followed my letter on the enforceability of the charges following the courts ruling (drawn from this forum) was another set back.

I’ve included a cut of the letter for ease, and just wondering if anyone had the same or can be advised on where to go from here:





''As we explained in our earlier letter of 18 December 2009, following the Supreme
Court's finding that bank charges are not capable of amounting to penalties at
eommon law and that the level of the charf!"'> cannot be assessed for fairness under
the Unfair Terms in Consumer Contract Regulations ("UTCCRs"), we believe that the
disputed charges were properly charged and that the outcome of the legal proceedings
supports our position. As a result, we confirmed that we would not be upholding your
complaint and would not be refunding the bank charges. We invited you to contact us
if you believed that the charges are unfair on grounds other than the level of the
charges, and that we had failed to address all of the issues raised in your complaint.
In response you have raised additional matters for our consideration. However for the
reasons set out below, we do not consider that any of these matters provide any other
basis on which your complaint should be upheld.
Regulation 5(1) UTCCR. Customers inability to 'opt out'. Unfair Cross Subsidy and
Charges application are designed to multiply
The Office of Fair Trading ("OFT"), which brought the bank charges test case against
various banks (including HSBC), and various individual consumers, have challenged
informal overdraft charges on two grounds, namely that: (a) they constitute penalties
at common law; and (b) they are unfair under Regulation 5 (1) of the UTCCRs on the
basis that they are too high. As has now been definitively determined, neither of these
two challenges is open to the OFT or consumers:
Section 140 Consumer Credit Act
You have not put forward any basis for claiming that your credit relationship with the
bank is unfair. We are confident that there is nothing inherently unfair about the
relationship between the bank and our customers. Indeed the OFT have recognised,
and we agree, that a generic challenge based on s.140A CCA would not have good
prospects of success. You have not informed us that there is anything your specific
case that would suggest otherwise. Accordingly, we do not accept your claim on this
ground.
The Misrepresentation Act 1967 or common law mistake
As is set out above, the courts have definitively determined that none ofHSBC's bank
charges amount to penalties at common law. Accordingly, there has been no
misrepresentation to either customers or the court and there was no mistake by
customers that HSBC was obliged to correct. We do not accept your claim on this
ground.
This letter constitutes our final response with regard to your complaint about overdraft
charges and should you remain dissatisfied, you have the option to refer to the
Financial Ombudsman Service. Further details about the Ombudsman scheme are set
out in the enclosed leaflet and you have six months from the date of this letter, within
which to refer your complaint to them should you decide to do so.
Whilst I accept that this letter will not provide the response you were hoping for, I
trust that I have been able to clarify the bank's position.
Yours sincerely
Susan Loker
Customer Service Manager

(1) In two judgments, Mr Justice Andrew Smith held that none of HSBC's
informal overdraft charges amount to penalties at common law: see [2008]
EWHC 875 (Comm), [2008] 2 All ER (Comm) 625; and [2008] EWHC 2325
(Comm), [2009] 1 All ER (Comm) 717. Neither decision was appealed by the
OFT. Both these judgments are publicly available, but please let us know if
you would like a copy of the judgments.
(2) On 25 November 2009, the Supreme Court ruled ([2009] UKSC 6, [2009] 3
WLR 1215) that it was not permissible to challenge the fairness of bank
charges under Regulation 5(1) of the UTCCRs on the basis that they are too
high because that form of challenge is precluded by Regulation 6(2)(b).
Regulation 6(2)(b) provides that the assessment (under Regulation 5(1» of the
fairness of a term in a contract "shall not relate ... to the adequacy of the price
or remuneration, as against the goods or services supplied in exchange". In
other words, the 'value for money' equation is excluded. The banks argued,
and the Supreme Court agreed, that the informal overdraft charges are part of
the price for personal current account services and that, therefore, the
Regulation 6(2)(b) exception appli~s with the consequence that the charges
cannot be found to be unfair on the basis that they are too high. Again, the
Supreme Court's judgment is publicly available, but we are happy to provide a
copy if required. In light of this, we do not accept that a claim based on
Regulation 5(1) is not affected by the Supreme Court judgment. Any
challenge to fairness under the UTCCRs must be made pursuant to the test in
Regulation 5(1). Given that your challenges under Regulation 5(1) relate to
the level of the charge, your claim is directly affected by the Supreme Court
mling as it holds that such challenge cannot be made.
Further, on 22 December 2009, having spoken to and considered the views of a
number of interested parties (including various consumer groups, the Financial
Services Authority, the Financial Ombudsman Service and the Government), the OFT
announced that in the light of the Supreme Court's judgment it would not be
continuing its investigation under the UTCCRs into the fairness of unarranged
overdraft charges. The OFT's decision was based on a careful consideration of the
matter (including various alternative grounds of challenge under the UTCCRs
suggested by consumer groups such as customers inability to opt out, unfair cross
subsidy and charges application are designed to multiply, which grounds you also rely
on), which led the OFT to conclude that following the Supreme Court's judgment
there were no other potential bases of challenge under Regulation 5(1) that stood a
realistic prospect of success.
In light of the above, it is clear that each of grounds in your letter have already been
dismissed by the higher courts and/or recognised by the OFT as having no reasonable
prospect of success. Therefore, we do not accept your claim under these grounds.''


This doesnot sound good and I'm really struggling to think of anything. thanks in advance

Premier_2

Have a read of the latest MSE articles on reclaiming bank charges

http://www.moneysavingexpert.com/reclaim/bank-charges

http://www.moneysavingexpert.com/reclaim/oft-bank-charges

Essentially it suggests that whilst financial hardship cases should still be considered (which may or may not lead to the refund of bank charges), any legal based attempt to recover charges is unproven & untested.

I'm not sure if anyone has won a claim since the Supreme Court ruling in November 2009 based only on the legal arguments.

natweststaffmember

I would add that you are not reclaiming under UTCCR 1999 regulation 5(1) on the basis that they are too high but that they have created an imbalance within the contract that is unfair.

mo1710

Thanks guys for the reply, just wondering f there is any value writing back with the point from natweststaffmember , other than i guess i can call it a day!!

I don't believe that my case would qualify for a hardship case consideration