Stax68 v HSBC

[stax68]

Hello all. My HSBC claim is in full swing.

 

I'm claiming for nine years of charges + all the interest charged on them to date, and I'm claiming compound interest on the amounts taken at the rates charged by the bank at the time for unauthorised borrowing. This means the interest I'm claiming in substantially more than the claim for charges and interest itself.

 

I've sent my initial letter, LBA and made a claim on MCOL.

 

I'll add the details of each in separate posts. Any comments welcome. I'd like to add my spreadsheet too, but it looks as though I'm not allowed to add attachments. Could a moderator lift this restriction, on a one-off basis if preferred?

 

[edit in response to some concerns expressed below:]

NB - the letters and particulars of claim are my own, tailored to my own circumstances and the nature of my claim. They aren't endorsed by the Bank Action Group, and are included only to give others ideas and to get feedback. If in doubt, you are probably best off making the standard claim using the standard tempates.

[stax68]

The Manager 00 XXXXXXX

HSBC Bank XXXXXXX

000 XXXX XXX XX0 0XX

XXXXXX

XXXX XXXXXX 28 November 2006

XX0 0XX

Dear Sir or Madam,

 

Excessive charges

 

1. As you are aware I have been a customer of HSBC for about ten years. I have taken out loans and a mortgage with the company. The bank's behaviour has in most matters been acceptable by the prevailing standards among high street banks, and I look forward to continuing my relationship with the bank.

2. However I have always been unhappy about the distressingly high level of charges applied to my account over the last nine years. I am writing (1) to lodge a formal complaint about these charges, (2) to dispute the validity of your statements of my account balance and (3) to ask you to refund these charges and make further payments as detailed below.

3. Due to recent publicity, I now understand that the regime of fees which you have been applying to my account in relation to exceeding overdraft limits are unlawful at Common Law and under statute. Additionally, it has been confirmed that your particularly high level of penalties are considered to be unfair per se by the OFT, who reported on the 5th April 2006, and are therefore presumed to be unlawful in the absence of specific proof to the contrary.

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

5. I consider that your repeated representations that your charges are fair and reasonable are deceptive and that they have deceived me into agreeing to pay them. Your concealment of the true nature of your charges has prevented me from asserting my right until now. Please note that in view of this this fact alone, statutory limitations, laches, estoppel etc do not affect the validity of any part of my claim, including that part relating to charges levied more than six years ago. In addition, the entirety of the claim falls well within the FSA's time limit for the lodging of complaints.

6. As well as taking these excessive and unjustified charges, you have further unjustly enriched yourself by levying interest payments on the sums taken. I require restitution of these payments. I consider further that you ought to pay me interest on the sums retained, at the appropriate contractual unauthorised borrowing rates. This reflects reciprocity in our contract and by your own example reflects banking usage. You will no doubt continue to have in your contemplation the fact that it was to be expected that I would need to borrow money at high rates while maintaining my debt level below or around the authorised level, in fear of further charges and/or recall of the debt. I feel that your making this payment to me provides an equitable way of resolving the issue and moving on.

7. I calculate that you have taken £2,597.00 plus £1,406.63 which you have charged me in overdraft interest for the sum which you have taken. The interest I am claiming on these deductions amounts to £5,990.89. Total £9,976.52.

8. I enclose with this letter a schedule of the deductions and interest thereon which I am claiming. The schedule shows the calculations used to derive the figures. The columns span two A4 pages in landscape layout. Pages are numbered from left to right, then top to bottom. In other words, odd-numbered pages contain the left-hand side of the schedule, even-numbered pages the right-hand side.

 

Our continuing relationship

 

9. Notwithstanding this unfortunate situation, I adjudge your services to be as good as any of the high street banks. Although the application of these charges has occasioned some mental distress over many years, I am keen to resolve this issue in a spirit of reconciliation. I hope that your payment to me will wipe the slate clean, and we can resume what has in most other respects been a satisfactory relationship. I note also with some approval that HSBC is not one of those organisations which have announced a policy of attempting to close the accounts of customers who seek to reclaim unlawful charges.

10. I am a long-standing customer of HSBC, having current, savings, loan, credit card, business, and (formerly) mortgage and home insurance accounts with you. In the ten years of our association I have never had any facilities withdrawn, nor any warning that such action was imminent. Neither have I run my account in an irresponsible manner. During the entire life of my account, I have found only three occasions on which payment was refused due to insuffucient funds. My borrowing has never to my knowledge remained over the agreed limit for a whole month, nor has it exceeded that limit by a sizable margin. I have also improved my money management skills recently. This year, I have exceeded my overdraft limit only once, on which occasion the account was over the limit by £9.20 for two days and £33.44 for one day.

11. I therefore do not expect to be faced with any withdrawal of facilities - in particular overdraft facilities - especially since (1) the payments due to me from you will bring my account into credit, and (2) I am hereby lodging a complaint, and such action by you could only be interpreted as a retaliatory measure. I would also point out that any attempt to declare the account in default will be in violation of the Banking Code since the amount owed is in dispute.

12. I do not wish to repudiate the contract under which I now operate my account. While I have never negotiated or explicitly agreed to any particular level of charges, I do not regard the charges as an issue for the future, both because I am confident that I will not incur any, and because I expect that such excessive charges are in the process of being eliminated from the terms and conditions under which you operate such accounts. Just as you have for many years tolerated my past repeated minor breaches of your terms, I am willing to tolerate the existence of an equally unconscionable charging schedule since I will make my best endeavours to avoid incurring any charges. The fresh start I propose and expect will be very helpful in ensuring that my account remains well within the contractual limits.

13. Furthermore, I may find it difficult to open another account should mine be closed in such circumstances. This is likely to have a disastrous effect on me and my growing family - leading to considerable distress and hardship. Under such circumstances, I would consider that our relationship had irretrievably broken down, and I would have little alternative but to pursue my claim to the greatest extent English law and equity permit. I am sure we are both concerned to avoid such open-ended litigation and the publicity attendant on appearing in higher courts if at all possible. I stress that I do not consider that our relationship has broken down in this way, and mention it only to avoid misunderstanding and emphasise the gravity of the situation which might not, without proper instruction, be apparent to bank staff.

 

Action required

 

14. I hope that you will enter into a sincere dialogue with me about this matter and I am writing this letter to you on the assumption that you will prefer to do this than merely respond with standard letters and leaflets. I also request that you inform me of the name and contact details of the person dealing with my complaint. I also recommend that you notify me of an email address to which I may send electronic copies of the attached schedule of charges and interest. This ought to speed what must by now already be a well-established process of investigation and deliberation. My email address is [email protected].

15. If you wish to contest any or all of the facts of my claim or the acceptability of the timetable set out below, I require that you supply me with particulars supporting your counterassertion. For example, if you wish to claim that any of your charges represents liquidated damages rather than a penalty, you should supply such evidence as: computer logs, time of transaction, evidence of any manual intervention, including name of person who intervened, time taken to reach decision, their salary, calculated at a cost per minute, any general office overhead and any other information that is used to show the true and actual cost incurred by your company for each of these penalty charges.

16. I will give you 14 days to reply to me accepting, unconditionally, my request in principle and letting me know a date by which I will receive payment. If you issue an unequivocal and intransigent refusal to recognise my claim, or if the 14 day period elapses without the matter being resolved to my satisfaction, I shall send you a letter before action giving you a further 7 days in which to reflect.

17. I believe that these targets are sufficient for a large company such as yours with dedicated staff and departments, particularly since there is no reason why negotiations or other communication should not be carried out by email (address as above) or by telephone (I may be reached on 000000000). Please note that any such conversations may be recorded in order to assist my memory or for evidential purposes should it prove necessary to resort to court action - an eventuality which I am confident we can avoid through an open and timely dialogue.

18. After the issue of a letter before action, no further communication will be initiated by me and I shall issue a claim at the expiry of the second deadline.

 

Yours faithfully,

 

 

XXXXX XXXXXXX

Account Number: 00000000000

Sort Code: 00-00-00

[stax68]

Mr XXX XXXX 00 XXXXX XXXX

Manager XXXXXX

HSBC Bank XX0 0XX

00 XXXXXXX

XXXX 13 December 2006

XXXXXXX

XX0 0XX

Dear Sir or Madam,

LETTER BEFORE ACTION

ACCOUNT NUMBER: 000000000

SORT CODE: 00-00-00

I am very disappointed that you have failed to respond to my letter of the 28 November 2006.

I would point out that in that letter, I stated in terms that the letter was to be taken as a formal complaint. Your failure to acknowledge the letter therefore appears to place you in breach of the Banking Code.

I now understand that the regime of 'fees' which you have been applying to my account in relation to direct debit refusals, exceeding overdraft limits and so forth are unlawful at Common Law, Statute and recent Consumer regulations.

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.

I calculate that you have taken £2,579 plus £1,406.63 which you have charged me in overdraft interest for the sum which you have taken.

I also require an additional payment of £5,990.89 which may be taken to represent an interest charge on this sum. Please note that this sum has increased since my initial letter, since another full month of interest has accrued.This brings the total to £9,976.52. I require repayment in full of this money.

I am enclosing an updated copy of the schedule of the charges which I am claiming. This supersedes the copy I sent in my original letter of the 28 November 2006.

If you do not respond within 7 days, and in any case if you do not comply fully with all of my requirements within 14 days, then I shall begin a claim against you for the full amount plus interest plus my costs and without further notice.

 

Yours faithfully,

 

 

XXXXXX XXXXXXX

Account number: 000000000

Sort code: 00-00-00

[stax68]

[HSBC Header]

 

Mr XXXX XXXXX

00 XXXXX XXXX

XXXXXXXXXX

XX0 0XX

 

18 December 2006

Dear Mr XXXXX

I write with reference to your letter dated 13th December 2006. I would like to apologise for the delay in response to your query. I would also like to advise you that due to the high demand from our customers regarding their bank charges the estimated response time is 6 to 8 weeks.

Sorry for the inconvenience caused. Please feel free to contact the customer service team if you have any further queries on 08457 404404.

Yours sincerely

 

A Minion

Customer Service Representative

 

 

[HSBC footer with my local branch details]

[stax68]

26/12/2006

 

Claimant has an account run on standard terms and conditions with HSBC Bank PLC since c. 1995, and claims £4038.66 levied by the defendant in charges, and interest thereon, from March 1997 to December 2006. The charges were levied under penalty clauses, unenforceable under statute and at common law. Alternatively, the charges are unreasonable per the Supply of Goods and Services Act 1982 ("SGSA") s15, etc. The bank has twice received full claim details but has not justified its charges. Details will be re-sent. Also claimed: costs; and compound interest, at the bank's unauthorised borrowing rates, to sum £6237.79 at 30/12/2006 and accruing further until judgement or settlement. Such interest is claimed: under the contract construed as fair and balanced and with doubt resolved in favour of the consumer, per SGSA s15 or otherwise; or under trade usage; or in response to fraud or to misapplication by a fiduciary; or as special damages. Alternatively, interest is claimed per the County Courts Act 1984 s69, or at such rates and of such type as the court may determine.

 

 

[note: on the claim, I gave the amount claimed as the total including interest, i.e. just over £10,000. My understanding is that the interest isn't included for the purposes of calculating whether the claim falls below the default threshhold for allocation to the small claims track.]

[stax68]

Well, that's where I am at present. I'd welcome any comments, questions or advice - and I'd like to add my spreadsheet if a mod could arrange this...

[cheddar]

I'll get this moved to the HSBC forum for you.

[MARTIN3030]

Welcome to the site.

The welcome forum is for ..........er......welcomes it is NOT the place to be highlighting your claims ptogress to date.

May I ask where these temp letters originate from ?

To avoid confusion I think it should be stressed that these are not BAG authenticated docs,although in saying this I do not mean to pass judgement on the merits or credibility of the letters.

We have our own here which do the job they were intended for using tried and tested points of both law and clarity.

I suggest you form a thread in your bank group and we can get this lot moved there.

I am afraid to say that my worry is that your posts here may add confusion to other new posters.

[stax68]

Oh right, OK, sorry. Yes, of course move it where you see fit and add your caveats. Looks like the 'welcome' section was very much the wrong place to post...

[zootscoot]

Hi Stax.

 

Welcome to the forum from a fellow soulie!

 

I'll move your thread for you so you can get advice from other HSBC customers.

 

Mods don't have the power to allow attachments

 

Great letters!

 

All the best

 

Zoot

[lateralus]

sounds like you've got it all in hand to me.

the hsbc forum can help with the details pertaining to that bank -

so, if you aren't aware - you've filed your claim, you will receive a notice of service in a couple of days from the bank, shortly after you will most likely receive a notice of acknowledgment - this buys them an extra 14 days to respond - so it's 28 days from the date of service they have to respond if they've acknowledged. if (when) they acknowledge, you should send 3 copies of your breakdown of charges to the court - referencing your claim number and also, you should send 1 copy to dg solicitors (hsbc's in-house legal team) who will be your contact from this point also referencing your claim number.

all the contact details are in the notes under the hsbc forum. on page 2 of the acknowledment you will find they have ticked their intention to defend fully the claim. you will also find their address and possibly a name. send them the breakdown as they will ask for it later and this shaves a couple of days off the waiting. then, most likely you will hear nothing more until it is nearly time for the defense to be filed by them.

i am assuming that such a large claim will be dealt with the same as those around the 5k level. hope this helps with the details of what goes on at this point. if you have questions, please ask.

[stax68]

Zoot - thanks for the welcome - is that a vespa you've got there? You say mods don't have the power to add attachments - the site must be run by a rocker, ho ho.

 

lateralus, thanks for the info

 

MARTIN3030 - the letters and claim text are my own invention, based loosely on the emplates from this site, but amended mainly -

1. To include a claim for compound interest at the bank's unauth. rates,

2. To forestall any account closure or other retaliatory action - which some banks try to do under the pretext that you must wish to repudiate the contract since you're unhappy with the charges.

3. To make a claim which goes back more than six years.

 

FINALLY - would someone be able to change the title of the thread to: stax68 v HSBC now it has been moved to the HSBC forum please?

[zootscoot]

Hi Stax,

 

Yes I ride a vespa!

 

I've changed your title for you.

 

I note that you are claiming back past six years but have not added any reference to s.32 of the Limitation Act in your particulars. This may cause a problem for you. I'm not sure what HSBC's normal tack is whether they generally defend or what stage they pay out. You may need to ammend your particulars if they question it.

 

All the best

 

Zoot

[stax68]

Thanks Zoot.

 

re the Limitations Act - I reckoned that it would be for them to raise that issue in their 'defence'. Even if valid, it would only provide a defence against part of the claim though, so it's no use to them. Their overriding priority is to keep out of court unless they are certain they can defend the whole claim, which they aren't, because they can't.

 

If they do raise the limitations issue in their defence, I can refer to the various subsections which together provide a pretty comprehensive set of alternative rebuttals. But as far as I know I don't need to do that until I'm in court. I guess I may clarify the point to the bank's solicitors if they do enter a supposed 'defence' - just to let them know I'm not going to be bluffed.

 

I don't really care what stage they pay out as they are bang to rights and even if it ever got to court the worst outcome for me (and a fairly unlikely one) would be getting 8% simple interest instead of the full compound rate I'm claiming.

 

The worst (and inevitable) outcome for them would be that they lose on the central issue, and I appear on the evening news as a result. Actually I suppose an even worse outcome for them would be if I somehow lost in the county court, and then won in the appeal court, thus setting a legal precedent!

 

Keep the faith

 

Stax

[zootscoot]

Hi Stax,

 

I see your out for the fame not just the fortune!

 

It is possible for them to admit part and defend part and request that the remaining part is struck out on the grounds that it is statute barred. I know Halifax and Natwest have done this. You would then need to object to the strike out using s.32 L.A. Its far easier to include it in your particulars in the first place as it stops any delaying tactics.

 

KTF

 

Zoot

[stax68]

Z

 

Ah, I see - thanks for this. How would I go about amending the particulars? I must admit I would have put it in if I hadn't been severely restricted by the money claim word and line limitations. How much delay could they cause by attempting to strike out the pre-6yrs part of the claim?

 

cheers

 

S

[zootscoot]

If you want to amend your particulars you will need to fill in form N244:

 

http://www.consumeractiongroup.co.uk/forum/bank-templates-library/41901-form-n244-application-notice.html

 

You also have to pay a fee of 35.00.

 

You might want to have a look at Bong's thread. She is also claiming beyond 6 yrs and contractual interest against HSBC. She has also posted her particulars:

 

http://www.consumeractiongroup.co.uk/forum/hsbc-bank/33005-bong-hsbc-contractual-interest.html

 

Ammending your particulars will also delay your claim as this will give them a further 14 days from the date they receive the ammended version. So you might decide to leave it as it is and respond to any defence as it arises. If they defend only part they will at least pay out the bulk of your claim at that stage.

 

Hope this helps

 

Zoot

[stax68]

Thanks Z. I've started looking at Bong's thread - lots of good stuff there. Enough to make me wish I'd been a bit less lazy and used an N1 at my (very) local county court!

 

PS - sorry to be a pain, but can you clarify about the 'striking out' side of things? This seems to be a distinct procedure from entering a defence - so would it stall the process of the claim getting (near) to court, or by delaying tactics do you just mean that they are more likely to defend if they think they can strike out part of the claim - and perhaps if they think I don't know what I'm doing?

 

PPS - If they did (per impossibile) strike out the earlier bit, I suppose I could still include the earlier charges in my calculation of how much of my O/D was a consequence of unlawful charges. i.e. if £500 of charges are struck out of the claim, and my mean overdraft level in the first month of the remaining part of the claim is £1000, I would reclaim 50% of the interest charged on the OD in that first month...

 

PPPS - how do you go about posting attachments? Do you have to pay, or get a lot of brownie points, or get some other sort of special status? I would really like to post my spreadsheet for feedback and because I think it might be useful to others (unless the feedback suggests otherwise!)

 

Stax

[stax68]

Acknowledgement of Service recieved dated 03 Jan 2007.

So they now have until the 30th Jan to file thier defence - which no doubt they will do at the last minute.

[lateralus]

and now is the time to send copies of your breakdown to the courts (3 copies-unless you did the N1 - you thread is so long i can't go back and check), and 1 copy to dg - you'll find address on pg2 of the acknow. reference your claim number and send it off - it can shave a few waiting days off the total.

[stax68]

Also received this, on the 4th January:

 

-------------------------------------------

2 January 2007

 

Dear Mr XXXXXX

 

Ref: 0000000000 - 000000 00000000

 

Thank you for your letter dated 28 November 2006 concerning your request for aq refund of bank charges. I apologise for not yet having completed my investigation.

 

I will contact you again by 29 January 2007 and expect to be able to provide you with a full response at that time.

 

In the meantime, I would like to thank you for your patience and enclose a copy of our leaflet which explains how these matters are dealt with. If you need to contact us, please quote the above customer reference number.

 

Yours sincerely

 

 

Colin Langdale,

Senior Service Quality Officer

 

 

 

HSBC Bank plc

Service Quality Team, Arlington Business Centre, Millshaw Park Lane, Leeds LS11 0PP

-----------------------------------------

 

Interesting that they've allowed themselves two months to 'investigate' - I wonder what that will involve? In their crappy little leaflet they state that if I receive no response after 8 weeks, I have the right to refer the matter to the ombudsman.

 

Out of interest, this appears to be based on the FSA/FOS rules at s2.3 of annexe A on the 46th page (not numbered page 46) of this document: http://www.fsa.gov.uk/pubs/policy/p32.pdf

 

which are given legal validity by s14 here: Financial Services and Markets Act 2000

 

The rules are based on 'consultation' as mandated by the Act - but according to the consultation document, almost all those consulted were firms (surpise, surprise). The legislation says things like this:

 

(4) If the scheme operator proposes to make any scheme rules it must publish a draft of the proposed rules in the way appearing to it to be best calculated to bring them to the attention of persons appearing to it to be likely to be affected.

 

(5) The draft must be accompanied by a statement that representations about the proposals may be made to the scheme operator within a time specified in the statement.

 

(6) Before making the proposed scheme rules, the scheme operator must have regard to any representations made to it under sub-paragraph (5).

 

How cosy can you get? I don't believe there's any will, on the part of those who drive legislation through, to stand up for consumers. The whole thing's just window dressing. Pass the whole issue on to a quango (quasi-autonomous? WTF is that supposed to be?) and let them do the dirty work of building a supposed regulation framework that doesn't inconvenience the big firms.

 

The legislation is full of stuff saying the FOS staff aren't crown employees, etc - looks like a litigation/criticism shield to me.

 

Ho hum.

[stax68]

Ah, thanks lateralus. Your post arrived as I was typing my last one. I was wondering about that. I'll get the copies sent off.

 

Do you think email would be OK for the DG copies - I'd like something verifiable, but cheaper than registered post. I've always thought that a shortcoming of the latter is that you can't prove what was in the envelope. With email you can, if the mail server you've saved your sent items on is to be trusted anyway.

[stax68]

Thanks to everyone for their help so far - I have got a couple of other questions though:

 

1. Now they've announced they are defending the whole claim, is it too late for them to ask for the earlier part of the claim to be struck out as being out of time under the Limitations Act?

 

2. How much am I restricted to the grounds for my claim as pled on the Money claim particulars? When putting in the alternative bases for claiming compound interest at bank rates, I didn't include restitution(/account of profits) for unjust enrichment. I don't really want to start the clock again or shell out £35 to alter my claim, but suspect that I may hae left out the best basis for claiming the higher interest.

 

Any advice here would be very much appreciated.

 

cheers,

 

Stax

[lateralus]

a couple of points - with e-mail, i recall seeing someplace on here months ago that for court purposes - fax was acceptable but e-mail is still slightly frowned upon - meaning - the advice to send it recorded delivery is still on. with recorded delivery - i scanned the delivered notice of each piece i sent and pasted onto the bottom of each letter in my file - thus, had it ever gone to court - i could prove delivery of every item. only costs a pound and i found in every instance, it was delivered next day - two at latest.

point: they've announced their "intention" to defend - not the actual defense - that comes at the end of the 28 days - the intention gives them that extra 14 days.

just leave the earlier charges in place - if dg (the solicitors) want to point them out and not pay them - that is up to them - just leave it.

as for the particulars not including what you wanted, you could pm bong - she's up on this stuff more than i am and she can tell you if it needs to be in there to get cont. int.

it is normal to get an offer (also normal not to) from the bank after you have filed. just send a polite rejection or acceptance as partial as per the template in the library section referencing that you have commenced your claim and it will now require xxxxx to settle and to halt the claim.

[stax68]

thanks Lateralus, I'll ask Bong as you suggest.