Lloyds Overdraft Terms deemed Unfair in new Bank Charges Victory

esmerellda

Lloyds TSB has been ordered to pay a customer over £1700 after it unfairly applied bank charges to his account and damaged his credit file.


In what we believe is the first bank charges court claim victory since such cases were stayed in July 2007, Oliver Foster-Burnell (‘orfoster’) has been successful in his claim for a refund of charges and interest.


The claim was brought against Lloyds TSB at Taunton County Court where Mr Deputy District Judge Stockdale held that despite the Supreme Court judgment, the unarranged overdraft charges levied on Mr Foster-Burnell were contrary to the requirement of good faith as per section 5(1) of the Unfair Terms in Consumer Contracts Regulations 1999 and, as such, unfair.


from: http://legalbeagles.info/beagle-wins-bank-charge-case/

colsten

Another nail in the coffin of free current accounts.

dr_adidas01

colsten wrote: »

Another nail in the coffin of free current accounts.

I'm not sure people will be ready for this eventuality...... lol

pt2537

colsten wrote: »

Another nail in the coffin of free current accounts.

you would rather the banks punish the most vulnerable people by using arbitrary charges which have no reflection on the true cost to the bank when a debtor defaults?

grumbler

esmerellda wrote: »

... the unarranged overdraft charges levied on Mr Foster-Burnell were contrary to the requirement of good faith as per section 5(1) of the Unfair Terms in Consumer Contracts Regulations 1999 and, as such, unfair....

It's worth clarifying that it was a pretty special case when charges were increased while the customer was already overdrawn.

EDIT: on a closer look it was because the charges were changed after the account was opened and without justification and negotiation .

PeacefulWaters

pt2537 wrote: »

you would rather the banks punish the most vulnerable people by using arbitrary charges which have no reflection on the true cost to the bank when a debtor defaults?

No. I'd rather people used their bank accounts sensibly.

pmduk

As a county court case I imagine it has absolutely no use as a precedent, so it's hardly gong to open any floodgates.

Uxb

pt2537 wrote: »

you would rather the banks punish the most vulnerable people by using arbitrary charges which have no reflection on the true cost to the bank when a debtor defaults?

Ah Yes: - that old chestnut about how a price/charge does "not reflect the true cost of doing something".
I don't recall that any business works on that basis. They work on the principle that the business has invested in the skills, equipment and years of experience that they have to enable them do the job in question quickly and efficiently for as high a price as they can get away with.

I suppose you expect someone like a plumber to come and replace a tap washer for £5 - being the cost to him of his 5 minutes in doing the job.

Alpine_Star

pmduk wrote: »

As a county court case I imagine it has absolutely no use as a precedent, so it's hardly gong to open any floodgates.

It will when it's gets to the Court of Appeal which it undoubtedly will.

fermi

On BBC You and Yours today. Listen from 16mins 42s onwards

http://www.bbc.co.uk/programmes/b04gcdt8

esmerellda

You can read the full judgment here

and it's in the Daily Mail today - which I'm sure you've seen but to keep it all together http://www.dailymail.co.uk/news/article-2763083/Victory-bank-charges-open-payout-floodgates-Court-backs-customer-hefty-overdraft-fees.html

oh and radio 5 live yesterday - with Martin - there's another thread about that I think. http://www.bbc.co.uk/programmes/b04h7kh7
from 22.33 mins in (then again after the news/traffic etc)