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Hi all I've been reading the site for a while and decided to issue a claim against Abbey. The amount's not huge but I really don't agree with their charges on my (Business) account.
I don't think I read enough before issuing my claim. I have now read on here that because I have a business account I can't rely on the 1999 Unfair Terms in Consumer Contracts Regulations to get my fees back.
Unfortunately before I read this...I **DID**cite UTCCR 1999 in my POC (please see below).
I have just received abbeys defence and separately from the court an acknowledgement of service. You can see the defence here:
- Does the particulars of claim below cite enough common law to enable me to make a case against abbey even though I have incorrectly cited UTCCR 1999?
**POC [have taken out personal details so I can post in public]**
Particulars of Claim:
On or around the 31 May 2007 the Claimant opened an account, account number: XYZ sort code: XYZ with the Defendant. The Claimant believes this was on the Defendant’s standard terms and conditions. There was no negotiation on these terms, it was on an either take it or leave it policy. In fact the Claimant had no option but to agree to the terms, as the Claimant would have met the same reply at any other Bank.
After going through archived account statements the Claimant discovered that the Defendant had applied charges to the Claimant’s current account from xx/yy/zz to xx/yy/zz totalling £500. A itemised Breakdown of these charges is provided in attachment “A”.
On XX May 2009 the Claimant sent a letter to the Defendant informing them that the Claimant believed the charges applied to account XYZ were penalty charges (B). The Defendant maintained that they were not.
On XX May 2009 the Claimant sent a further letter to the Defendant, offering the Defendant a further opportunity to refund the penalty charges applied to account XYZ (C). The Defendant did not refund the charges applied to the Claimant’s account or prove that the charges were lawful.
The Defendant has not provided any legal evidence that they have any legal right to apply the charges referred to above. Furthermore they have offered no evidence that the charges referred to above are a true estimate of the administrative cost involved with operating the account. The Claimant has been left with no option but to issue a claim for the charges and related interest that have been applied to the Claimant’s account.
It is the Claimant’s argument that the Defendant’s charges are a disproportionate penalty and therefore are unenforceable, the Claimant relies on the following:
Common law Principles (Penalty charges are irrecoverable at common law).
The precedent for this was:
Dunlop Pneumatic v New Garage [1915] AC 79.
Lord Dunedin set out some tests that are considered even in modern cases when the court is asked to rule on penalty charges.
They are; 1) If it is "extravagant and unconscionable" i.e. that the cost incurred by the business because of the breach is lower than what the consumer is being expected to pay because of the breach.
2) It is also a penalty where the consumer is to pay a larger sum due to failure to pay a smaller sum.
It was held that a contractual party can only recover damages for an actual loss or liquidated losses. Murray v. Leisure play [2005] EWCA Civ 963
“English contract law recognises that, if the parties agree that a party in breach of contract shall pay an unjustifiable amount in the event of a breach of contract, their agreement is to that extent unenforceable”
CMC Group Plc And Others V Zhang [2006] EWCA Civ 408.
“'Whether a provision is to be treated as a penalty as a matter of construction to be resolved by asking whether at the time that the contract was entered into the predominant contractual function of the provision was to deter a party from breaking the contract or to compensate the innocent party for breach. That the contractual function is deterrent rather than compensatory can be deduced by comparing the amount that would be payable on breach with the loss that might be sustained if breach occurred.”
Furthermore or in the alternative penalty charges are also contrary to:
The Unfair Terms in Consumer Contracts Regulation 1999 No 2083
SCHEDULE 2 Indicative and Non-Exhaustive List of terms which may be regarded as unfair
(e) Requiring any consumer who fails to fulfil his obligation to pay a dis-proportionately high sum in compensation
Further or in the alternative if the defendants state that there was no breach of contract and that the charges are for a service, then it is the Claimants belief that the defendants have attempted to restructure accounts in order to present events of default spuriously as additional services.
However The Unfair Terms in Consumer Contracts Regulations 1999, are concerned with the intention and effects of terms, not just their mechanism. For example, a charge for 'agreeing to' or 'allowing' a customer to exceed his credit limit is no different from a charge for the customer's 'default' in exceeding his credit limit.
The Claimant claims from the Defendant a sum equivalent to the total amount unlawfully debited from the Claimant’s account being £500.
The Claimant further claims the court fee of £30.
The Claimant respectfully requests that the court makes an order for standard disclosure, when issuing this claim.
You are lucky that the claim has not been stayed.
As expected Abbey have picked up on both uses of case law in their defence.
Firstly they have argued Justice Smiths findings,and second they have dismissed the consumer terms which is right as you know.
Much depends upon the next stage,Abbey do not appear to have asked for a strike out,on the basis of no cause of action,nor have they requested any stay.
Therefore the next stage is allocation.
The £500 puts it well inside the SCT-so no confusion there.
You can either make an application on form N244 to amend the POCS by removing the referenced to unfair consumer terms,or await to see if Abbey request it.
I think the best way will be to address this with your Allocation questionaire-which will not be too far away.
The draft directions for disclosure should also be included with the aq.
The urgency as I see it,is not the POCS, but your need to study the Abbey Judgements and separate any differences that you can spot between those terms Smith looked into and those of your own.
It is essential that you get these as well as any separate tariffs that cover the period of your account.
If you have not got them,then you should include this request in your disclosure draft.
Will retitle your thread and move to Business forum.
feel free to ask if you dont understand any of the above.
Martin Thank you so much for the response, I guess what I will do next, is start researching completion of the allocation questionnaire and the draft directions for disclosure. I don't have my T+C's on hand so I will request them as part of the draft directions for disclosure (DDFD).
Where would I find the Abbey judgements you refer to? Are they on this site?
So when I find the judgements. For each cases judgement, I need to go through my T+C's that I will receive after the DDFD and compare them to the T+C's used in the particular case?
What happens with the differences in T+C's I sift out? How do I go about using them?
Sorry for not being more informed im just getting a little lost in the sea of information.
Yes I understand what you are saying.
Basically,in the test case,the terms and conditions supplied by the 8 banks were those which related to personal current accounts.
These included joint accounts,students,and accounts which offered extra benefits such as Gold etc.
The Oft case did not seek to look into business accounts,and the OFT clearly states this on their website.
However,a few of the banks are maintaining that the terms and conditions for their personal current accounts were THE SAME as those for their business.
We find this to be quite extraordinary,since business accounts operate quite different.
Much of Justice Smiths observations coincerned how the breaches would occur,what the procedure was to avoid a breach,and what opportunity existed for the account holder to rectify any breach without incuring charges,or further charges.
It is these elements that need to be examined in your case.
I will have a look through my copies of the docs Abbey supplied and post further info for you here.
Lets hope so.
Having confidence and desire to take them on is much of the important side.
If you have both of these,then that will help enormously as things move forward.
I Will be attaching as directed in the above link:
1A) Section G - other information
1B) List of settled cases
1C) Text of order made by Lincoln county court
1D) Mullen -v- Hackney BC (1997)2 A11ER 906
2A) Draft Order for directions
However I cant Find >>> 1B) List of settled cases.
Its supposed to be at the link below but I cant find it on that page?
It does not bear too much relevance now.
Most banks argued when this was presented that cases are looked at on an individual and commercial basis-I had this cited in one of my cases.
Additionally,the list was compliled pre test case and so they are likely to point that out too.
I therefore would not worry so much about that.
Your submissions in your aq look fine.
Unless of course someone else has info that suggests otherwise.
So I shouldn't try to get an abuse of process strike out as I will have no post OFT judgement cases to cite? I should just leave out the chunk of text "1" in the sample "Section G" given here >>> http://www.consumeractiongroup.co.uk...s-keeping.html
And just leave in chunk of text "2"?
And in terms of the Draft Order for Directions
Does it matter if I use A or B as they do seem pretty similar?
A while ago in mid October or so I received a letter from the court saying:
Now I want to apply for further directions, is this the correct thing to do and is it worth proceeding with this now that the banks have won their case?
I don't want to just do nothing and let Abbey win by having my case struck out by default!
Is getting further directions, as referred to in the letter, as simple as writing a letter to the court saying "please can I have further directions"?
Any help is really greatly appreciated! Not sure what to do and time is running out!
As you will know and have read,Its going to take somethig special to convince a Court that your case should proceed with merit.
In principle,the decisions from the Supreme Court dont affect much the rulings made previously by Smith which for much part took away the main arguements for business claimants-that under common law.
Basically that means that Business claimants were in limbo BEFORE the SC ruling.
You have a choice to either ammend your POCs to include further arguements/introduce more,or else have to decide if you have enough to go further.
Only you can make that decision.
Abbey Business claim / POCS wrong
. The amount's not huge but I really don't agree with their charges on my (Business) account.
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