Alliance & Leicester - Settled

[mcuth]

Hi all

Well, after stumbling across the "Bank charges - illegal?" thread on Money Saving Expert late on Friday night, I found this site. Having reviewed lots of information on here, I totted up my bank charges since I opened my A&L account last year..... just under £1100

I haven't had any previous contact with them on this issue (apart from the odd charge being refunded as a goodwill gesture previously - hence the "nett" comment in the letter) So, to get the ball rolling, I took the preliminary letter and modified it a little. First draft is below, it's ready to send on Monday morning - unless you can see anything wrong with it? Your input appreciated

Alliance & Leicester PLC
Personal Customer Services Centre
Bootle
Merseyside
GIR 0AA

Dear Sir/Madam

ACCOUNT NUMBER XXXXXXXXX – {Name}
REQUEST FOR REFUND OF CHARGES

My request
I am writing to ask you to refund the charges which you have levied from my account since inception in {month, year}. I now understand that the regime of “fees� which you have been applying to my account in relation to direct debit/standing order refusals, unauthorised overdrafts and so forth are unlawful at Common Law, Statute and recent Consumer regulations.

Your responsibilities
I would draw your attention to the terms of the contract which you agreed to at the time that I opened my account. It is an implied term of that contract that you would conduct yourselves lawfully and in a manner which complies with UK law.

I am frankly shocked that you have operated my account in this way as I had always reposed confidence in your integrity and expertise as my fiduciary.

What I require
I calculate that, as at today’s date, you have taken a nett total of £XXXX.XX plus £X.XX which you have charged me in unauthorised overdraft interest on the amounts you have taken. Total £XXXX.XX. I request that you refund this amount in full.

Targets to resolve this matter
I hope that you will enter into a sincere dialogue with me about this matter and write on the assumption that you will prefer to do this rather than merely respond with standard letters and leaflets.

You have 10 working days, from receipt of this letter, to reply unconditionally accepting my request in principle and letting me know a date by which I will receive payment.

If you do not respond, or do not respond positively, within this time period, I shall send you a further letter before action allowing a further 10 working days in which to reflect. I believe that these targets are more than sufficient for a large company such as yours with dedicated staff and departments.

After that will be no further communication from myself and I shall issue a claim at the expiry of the second deadline.

I look forward to hearing from you by return.

Yours faithfully,

{name}

Cheers

Michael

[BankFodder]

It frightens me - and I wrote it!!

As long as you know what they owe you then gp ahead. If you don't then send a Data Protection Act request first.

Make sure in your mind that you are ready to go to court on this if they get stubborn.

Have you got a parachute?

[mcuth]

Hehe, BankFodder - I didn't mean to scare ya

Yeah, I know what they owe - I went through all my statements and did the whole spreadsheet thing last night. Only blanked out the detail in the letter to de-personalise it a little Definitely ready to go to court over the whole thing too - not a lot to lose, but a lot to gain isn't there? Am setting up the parachute in the morning - probably time to move banks anyway, given how A&L have mucked me around..

Am contemplating taking action against all my creditors too - but there's an added risk there that they've frozen the interest on my accounts, don't want them to start that too. Plus, there's my mortgage account with the Halifax, they know how to rack the charges up on arrears..... hmmm.....

One thing - should the preliminary letter contain the examples of cases & references to liquidated damages?

Cheers

Michael

[BankFodder]

Originally Posted by mcuth

One thing - should the preliminary letter contain the examples of cases & references to liquidated damages?

Cheers

Michael

It's a fair point but I expect thatthey are fully aware of all of that already.

[mcuth]

Originally Posted by BankFodder

It's a fair point but I expect thatthey are fully aware of all of that already.

Yeah, I realise they're probably aware - I just really want to cover all the bases as this is my first salvo I've modified it again then, with some extra info from this letter:

Alliance & Leicester PLC
Personal Customer Services Centre
Bootle
Merseyside
GIR 0AA

Dear Sir/Madam

ACCOUNT NUMBER XXXXXXXXX – {name}
REQUEST FOR REFUND OF CHARGES

My request
I am writing to ask you to refund the charges which you have levied from my account since inception in {month, year}. I now understand that the regime of “fees� which you have been applying to my account in relation to direct debit/standing order refusals, unauthorised overdrafts and so forth are unlawful at Common Law, Statute and recent Consumer regulations.

I am of the view that your charges represent a penalty and are therefore unrecoverable at common law. In the Scottish case of Castaneda and Others v. Clydebank Engineering and Shipbuilding Co., Ltd. (1904) 12 SLT 498; the House of Lords held that a contractual party can only recover damages for actual or liquidated losses incurred from a breach of contract. This is also the position in English law: Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79.

Your charges do not reflect any actual loss; instead they appear to represent a lucrative profit-making scheme. In particular, charges were applied after I entered into transactions without sufficient funds in my account and also when I have gone overdrawn without authorisation. The actual loss is the cost of automatically sending me a computer generated letter. I would respectfully submit that is valued at no more than 50 pence.

UK banks have recently given evidence to the House of Commons Treasury Committee on how bank charges are calculated: "The costs are going to pay for all the people we have who pursue debt, collect debt, speak to customers and chase payments. The way these charges are arrived at is by taking these total costs and making some assumptions about the volume that is going to come through to arrive at the individual charges" (2nd report, 25 January 2005, paragraph 50).

Accordingly, the charges applied to my account are not a reasonable pre-estimate of the bank’s loss in relation to my account. No-one has had to look at my account or telephone me. No one has had to collect anything. Your charges would appear to represent a device to recover global losses (for example, loan defaulters, bad debt write off, including commercial lending in, and outwith, the UK).

On a separate note, your charges appear to represent an unfair term of contract which is contrary to the Unfair Terms in Consumer Contracts Regulations 1999 (SI. 1999/2083). My account falls within the ambit of Regulation 5 of the Unfair Terms in Consumer Contracts Regulations 1999 as I am a consumer. Your charges constitute an unfair penalty under reference to paragraph 1(e) of schedule 2 of the said regulations:
‘Indicative and non-exhaustive list of terms which may be regarded as unfair - 1. Terms which have the object of effect of - (e) requiring any consumer who fails his obligation to pay a disproportionately high sum in compensation’.

0n 26 July 2005, the OFT stated that 'a charge is likely to be disproportionately high if it is more than a court would be likely to award if the lender sued the cardholder for breach of contract'. Because your charges include a large profit margin, in addition to actual loss, they are unrecoverable as an unfair term in contract. I believe that your charges require me to pay a disproportionately high sum in compensation for incurring a transaction(s) which was ultimately declined by an automated computer system.

In addition, it is unfair to require me to subsidise your global debt recovery costs and debt write-off.

Your responsibilities
I would draw your attention to the terms of the contract which you agreed to at the time that I opened my account. It is an implied term of that contract that you would conduct yourselves lawfully and in a manner which complies with UK law.

I am frankly shocked that you have operated my account in this way as I had always reposed confidence in your integrity and expertise as my fiduciary.

What I require
I calculate that, as at today’s date, you have taken a nett total of £XXXX.XX plus £X.XX which you have charged me in unauthorised overdraft interest on the amounts you have taken. Total £XXXX.XX. I request that you refund this amount in full.

Targets to resolve this matter
I hope that you will enter into a sincere dialogue with me about this matter and write on the assumption that you will prefer to do this rather than merely respond with standard letters and leaflets.

You have 10 working days, from receipt of this letter (i.e. by Monday 13th March 2006), to reply unconditionally accepting my request in principle and letting me know a date by which I will receive payment.

If you do not respond, or do not respond positively, within this time period, I shall send you a further letter before action allowing a further 10 working days in which to reflect. I believe that these targets are more than sufficient for a large company such as yours with dedicated staff and departments.

After that will be no further communication from myself and I shall issue a claim at the expiry of the second deadline.

I look forward to hearing from you by return.

Yours faithfully,

{name}

Whaddya reckon?

Cheers

Michael

[BankFodder]

Great - I hope that you are going to take the xxx's out and put in some real money!

[stubbarama]

Thats what i was thinking but didnt want to say.

[mcuth]

Originally Posted by BankFodder

Great - I hope that you are going to take the xxx's out and put in some real money!

Well, only if you think that'll help

Cheers

Michael

[mcuth]

Well, the letter's gone Special Delivery today - should be with them by 1pm tomorrow Bring it on!

BTW, noticed a couple of typos and that I'd missed the Bridle Road off the address in the drafts above and added a couple more examples to the cases - so, the final letter (yes, the XXXs were replaced before printing ) is below:

Alliance & Leicester PLC
Personal Customer Services Centre
Bridle Road
Bootle
Merseyside
GIR 0AA

Dear Sir/Madam

ACCOUNT NUMBER XXXXXXXXX – XXXXXXXXXXXXXXX
REQUEST FOR REFUND OF CHARGES

My request
I am writing to ask you to refund the charges which you have levied from my account since inception in {month} {year}. I now understand that the regime of “fees� which you have been applying to my account in relation to direct debit/standing order refusals, unauthorised overdrafts and so forth are unlawful at Common Law, Statute and recent Consumer regulations.

I am of the view that your charges represent a penalty and are therefore unrecoverable at Common Law. In the Scottish case of Castaneda and Others v. Clydebank Engineering and Shipbuilding Co., Ltd. (1904) 12 SLT 498; the House of Lords held that a contractual party can only recover damages for actual or liquidated losses incurred from a breach of contract. This is also the position in English law: Wilson v Love [1896]; Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79; Ford Motor Co v Armstrong [1915]; Bridge v Campbell Discount Co. Ltd [1962]; Murray v Leisureplay [2004].

Your charges do not reflect any actual loss; instead they appear to represent a lucrative profit-making scheme. In particular, charges were applied after I entered into transactions without sufficient funds in my account and also when I have gone overdrawn without authorisation. The actual loss is the cost of automatically sending me a computer generated letter. I would respectfully submit that is valued at no more than 50 pence.

UK banks have recently given evidence to the House of Commons Treasury Committee on how bank charges are calculated: "The costs are going to pay for all the people we have who pursue debt, collect debt, speak to customers and chase payments. The way these charges are arrived at is by taking these total costs and making some assumptions about the volume that is going to come through to arrive at the individual charges" (2nd report, 25 January 2005, paragraph 50).

Accordingly, the charges applied to my account are not a reasonable pre-estimate of the bank’s loss in relation to my account. No-one has had to look at my account or telephone me. No one has had to collect anything. Your charges would appear to represent a device to recover global losses (for example, loan defaulters, bad debt write off, including commercial lending in, and outwith, the UK).

On a separate note, your charges appear to represent an unfair term of contract which is contrary to the Unfair Terms in Consumer Contracts Regulations 1999 (SI. 1999/2083). My account falls within the scope of Regulation 5 of the Unfair Terms in Consumer Contracts Regulations 1999 as I am a consumer. Your charges constitute an unfair penalty under reference to paragraph 1(e) of schedule 2 of the said regulations:
‘Indicative and non-exhaustive list of terms which may be regarded as unfair - 1. Terms which have the object of effect of - (e) requiring any consumer who fails his obligation to pay a disproportionately high sum in compensation’.

0n 26 July 2005, the OFT stated that 'a charge is likely to be disproportionately high if it is more than a court would be likely to award if the lender sued the cardholder for breach of contract'. Because your charges include a large profit margin, in addition to actual loss, they are unrecoverable as an unfair term in contract. I believe that your
charges require me to pay a disproportionately high sum in compensation for incurring transactions which were ultimately declined by an automated computer system.

In addition, it is unfair to require me to subsidise your global debt recovery costs and debt write-off.

Your responsibilities
I would draw your attention to the terms of the contract which you agreed to at the time that I opened my account. It is an implied term of that contract that you would conduct yourselves lawfully and in a manner which complies with UK law.

I am frankly shocked that you have operated my account in this way as I had always reposed confidence in your integrity and expertise as my fiduciary.

What I require
I calculate that, as at today’s date, you have taken a nett total of £XXXX.XX plus £X.XX which you have charged me in unauthorised overdraft interest on the amounts you have taken. Total £XXXX.XX. I request that you refund this amount in full.

Targets to resolve this matter
I hope that you will enter into a sincere dialogue with me about this matter and write on the assumption that you will prefer to do this rather than merely respond with standard letters and leaflets.

You have 10 working days, from receipt of this letter (i.e. by {day}, {date}), to reply unconditionally accepting my request in principle and letting me know a date by which I will receive payment.

If you do not respond, or do not respond positively, within this time period, I shall send you a further letter before action allowing a further 10 working days in which to reflect. I believe that these targets are more than sufficient for a large company such as yours with dedicated staff and departments.

After that will be no further communication from myself and I shall issue a claim at the expiry of the second deadline.

I look forward to hearing from you by return.

Yours faithfully,

{name}

Will update this thread as & when a reply is received...

Cheers

Michael

[mcuth]

For once the Royal Mail did me proud - the letter was confirmed on Track & Trace as delivered well before the 1pm guaranteed time - hoorah!

Cheers

Michael

[mcuth]

Received my first contact from A&L today:

Dear {mcuth}

I am writing in response to your recent communication and was very sorry to learn of your disappointment with the service you have received.

Thank you for taking the time to highlight your concerns, we are currently looking into the situation and will be writing to you with a more detailed response.

In the meantime, I am enclosing a leaflet which explains the steps we will take to handle your complaint.

Yours sincerely

Leaflet enclosure was the "Your guide to complaints" leaflet, blah blah blah "If you're still not happy with our final response or the update provided by day 56, you can contact the Financial Ombudsman Service."

Day 56? ROTFLMFAO - not a chance.

I'm going to drop them a line by fax today, saying that because the Ombudsman doesn't rule on breach of contract, their standard complaints procedure and the timelines discussed therein are not applicable. Remind them that they have until next Tuesday to respond in full, before my LBA is sent in.....will update with my fax later.

BTW, I have the above letter & complaints leaflet scanned if needed?

Cheers

Michael

[monochrome_blue]

Micheal,

I've just fired off my first letter to A&L, how have you gotten on with this?

Cheers

Austin

[mcuth]

Ok, draft of the reminder to be faxed:

Alliance & Leicester PLC
Customer Contact Centre
Bridle Road
Bootle
Merseyside
GIR 0AA

By fax to 0151 966 2079
Pages 1 of 1

Dear Sir/Madam

ACCOUNT NUMBER [account number] – [name]
REQUEST FOR REFUND OF CHARGES – YOUR REF [ref]

Thank you for your letter of 7th March 2006, received today.

In my letter of 28th February, 2006, I set out that you had 10 working days from receipt of that letter (i.e. by Tuesday 14th March 2006), to reply unconditionally accepting my request in principle and letting me know a date by which I will receive payment. I also stated that “If you do not respond, or do not respond positively, within this time period, I shall send you a further letter before action allowing a further 10 working days in which to reflect. I believe that these targets are more than sufficient for a large company such as yours with dedicated staff and departments. After that will be no further communication from myself and I shall issue a claim at the expiry of the second deadline.”.

In the absence of a satisfactory resolution from yourselves, please note that I will continue to work to this timetable.

If we are unable to resolve this issue within this timetable, I am highly doubtful that the Financial Ombudsman Service has the ability to rule on the legalities of liquidated damages & punitive charges (see: Scottish case of Castaneda and Others v. Clydebank Engineering and Shipbuilding Co., Ltd. (1904) 12 SLT 498; English cases of: Wilson v Love [1896]; Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79; Ford Motor Co v Armstrong [1915]; Bridge v Campbell Discount Co. Ltd [1962]; Murray v Leisureplay [2004]). Also, the Financial Ombudsman Service would be unable to rule on unfair terms of contract (see: Unfair Terms in Consumer Contracts Regulations 1999 (SI. 1999/2083), reference paragraph 1(e) of schedule 2).

I look forward to hearing from you by return.

Yours faithfully,

{name}

What do you reckon? Also nicely sets out my reasoning for not using the Ombudsman, if that's brought up in court, yes?

Austin - my progress to date is all contained within this thread - i.e. Sent preliminary letter, only received above acknowledgement, reminder being drafted.

Cheers

Michael

[mcuth]

Above "reminder" fax sent today

Cheers

Michael