BANK CHARGES UPDATE - OCTOBER 2008 On the 28th October the banks will begin an appeal in the High Court. They are arguing against the decision that bank charges are subject to 'fairness rules'. The appeal is expected to last for 6 working days and cover judgements into current and historic contract terms. What does this mean to you? Unfortunately it means that there is very little chance we can proceed with your claim until a final judgement has been made. Rest assured that we will be in touch with you when this matter is resolved in the Courts and claims are resumed. Please note however that this could still take several months. If you feel you are in Financial Difficulty we may be able to process your claim immediately. Please call 0800 051 54 51 for more information.
24th April 2008 – HIGH COURT RULING We refer to the recent high court ruling in relation to the Test Case brought by the Office of Fair Trading (OFT) against a number of banks/building societies in respect of unauthorised bank overdraft charges. Basis Of Case In the first instance, it is important to note that the Test Case was to establish whether the “Consumer Contract Regulations” apply to the banks’ Terms & Conditions. The case was NOT about whether the level of unauthorised overdraft charges currently and previously charged were unfair. Ruling (1) The Judge – Mr. Justice Andrew Smith – ruled that the Consumer Contract Regulations do indeed apply. This paves the way for the OFT to investigate the level of unauthorised overdraft charges and decide what a fair charge should be. (2) The judge also ruled that the banks’ terms and conditions were plain and intelligible. Implications for Frozen Bank Charge Re-Claims When the Test Case was initiated, the Financial Services Authority (FSA) granted a “Waiver” to banks permitting them to stop processing existing claims in respect of unauthorised overdraft charges as well as future claims. Furthermore the Financial Ombudsman Service (FOS) refused to hear any appeals. Cases being progressed through the courts were also put on hold (“stayed”). We await a decision from the FSA as to whether the Waiver will now be lifted in light of the ruling, or whether it will remain in force until the outcome of any potential Appeal is known. The banks have a limited period of time to lodge any such Appeal. FOS are likely to follow the FSA’s lead in this matter. Meanwhile, cases in the court system remain “stayed” until the end of May. What To Do Next We will contact you once we have received a full update from the FSA as to the position of the Waiver and when the processing of claims by the banks is likely to re-start. Yours sincerely, The Brunel Franklin Bank Claims Team Frequently Asked Questions