HSBC Letter in Response to High Court Case
Hi All
Today I received a letter from HSBCtitled
Dear Mr PGH
Your unarranged overdraft
OFT v HSBC and Others - High Court Case
WE previously wrote to you about your compalint regarding unarranged overdraft charges and advised that we, along with a number of other banks and the OFT were invloved in legal proceddings in the high court to decide the legality of charges in this type of circumstance (What type of circumstance)
We write to update you following the judgement in the high court case given on 24 April 2008. As explained below this judgment deals with some preliminary issues relating to unauthorised overdraft charges and was given after the first trial in the test case process. That trial was not the final hearing in the test case process.
A case managment conference (CMC) also took place on 22 & 23 May 2008. This ws a procedural hearing to decide the next steps in the trial case process.
What was the first trial about
At the hearing that ended in February this year. The Judge was asked to decide whether the Banks T&C's relating to unarranged overdraft charges are capable of being assessed fot fairnance under the Unfair terms in Consumer Contracts Regulations 1999 (UTCCR's) and capable of amounting to penalities at common law (They are to me)
What does the judgement say?
This judgement - which contains important points for both the banks and the OFT to consider - marks the first stage in the test case process. The banks remain commited to resolving, through the courts the lgal issues concerning unarranged overdraft charges. The judgement illustrates how complex those issues are. (Not complex at all they are unfair)
The court has decided (subject to appeals) that the banks current T&C's relating to unarranged overdraft charges:
- Are not unenforceable penalities, but
- Are assessable for fairness under the UTCCR's
The Banks are pleased (I bet they are) that the court has agreed that their current charges are not unenforceable penalties.
What happens next?
At the CMC on 22 & 23 May 2008 the judge made the following decisions in relation to the next steps.
- The banks are allowed to appeal the judges decision in relation to the UTCCR's
- In the meantime the court will be asked to consider whether T&C's previoulsy used by banks are capable of being assessed for fairness and are capable of being penalties, A short hearing to decide these issues will take place on 7 & * July 2008.
- The court will set a timetable for the enxt steps in the case in July.
The banks and the OFT agreed that the case should move forward as quickly as possible. With assistance from the court, this has been achieved to date (Really) and the banks are committed to ensuring that this remains the case going forward. At this stage it is not possible to predct when the case will be finally concluded.
What this means for your complaint
As previously agreed with the Financial Ombudsman Service and FSA, customer complaints relating to unarranged overdraft charges will continue to remain on hold. The FSA agreed to this subject to conditions that protect your rights.
The banks will also continue to ask county and sheriff courts to keep cases relating to unarranged overdraft charges on hold until the test case process is concluded.
Further Help.
You have the right to refer your complaint to the fos
Further Information
A copy of the text of the full judgement can be found at Judiciary of England and Wales website and further infomation is available on our website.
Thank you for your patience.
Yours HSBC
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Originally Posted by Bookworm
