Written by John Kruse, one of the leading experts on Bailiff Law, this consumer friendly guide is essential reading for anyone who comes into contact with a bailiff.
The book is easy to understand and clearly explains the rights
a bailiff has, and also what they cannot do when collecting debts and repossessing goods etc.
Reading the Case Guidance Notes in the FAQ, it states the following:
On the issue of that the charges are merely a profitable service:-
You are arguing that under s.15 Supply of Goods Act the cost of the 'service' is required to be reasonable. S.15 says that where no price is agreed at the time the contract is made, that a reasonable price will be implied.
But what if in the terms and conditions it actually stated the price of the charges, that therefore a price has been 'agreed'?
I'd appreciate some help on this point because it may be that I shall have to argue against the service defence...
The bank will have to prove what "service" they provided. They say the service is for advancing you money that isn't yours by allowing you to go overdrawn or over your overdraft limit. But that doesn't include not letting you and then charging you or fees just for being overdrawn (as A&L do) or card misuse fees - it only applies to what Nat West call the "paid referral fee" - i.e. when they see a transaction that puts you over your limit but decide to pay it anyway. There is no service, just a penalty charge.
The better argument than the s.15 SOG Act argument is that they are merely trying to cloak the penalty, to disguise it as a service, which in reality it isn't. And you can bet your bottom dollar that the terms and conditions do not make it expressly clear that they will provide a service and in what circumstances they will do so. It is a consumer contract - any doubt will be construed in your favour.
Have a read of the OFT April report - it discusses "disguised penalties".
But HSBC for example have a 'price list' and actually stipulate that the fee for a payment that takes you over your overdraft or an unauthorised overdraft is a service charge (£25) and that's in the terms and conditions when you open the account...And their defence is that it is a service laid out in the terms and conditions...
you need to have a look at what constitutes a penalty charge in order to understand that just because something is called a service charge it doesnt mean it is.
The whole ethos of the banks was to set unlawful terms in your contract and then apply them. This doesnt mean in law they are right.
Basically if its a service then surely you have a right to ask for it or not? The automatic application of something to your account is not in my book a service. Especially when they make no specific offer of this service and choose on an apparently ad hoc manner as to when and if they will provide it.
In other words they may one day allow a dd through and charge you for processing it, then the next day they wont and then charge you for that too.
I think everyone understands your concerns, the banks are simply trying to stop you claiming by using a piece of bluff. Dont swallow it, do some more reading and then press ahead in the full knowledge that you are right and they are wrong.
HTH
Glenn
Kick the shAbbey Habit
Where were you? Next time please
Abbey 1st claim -Charges repaid, default removed, interest paid (8% apr) costs paid, Abbey peed off; priceless
Abbey 2nd claim, two Accs - claim issued 30-03-07 Barclaycard - Settled cheque received
Egg 2 accounts ID sent 29/07 Co-op Claim issued 30-03-07
GE Capital (Store Cards) ICO says theyve been naughty
MBNA - Settled in Full
GE Capital (1st National) Settled
Lombard Bank - SAR sent 16.02.07
MBNA are not your friends, they will settle but you need to make sure its on your terms -read here Glenn Vs MBNA
It is not only Judges who are aware of 'penalty cloaking'. The OFT made that very
point in their statement back in April about credit card companies trying it on. And
it applies equally to bank accounts.[It may be that the banks do not accept that
some of the factors relating to credit cards do not apply to bank accounts, over
drafts and loans, but there can be no doubt that penalty cloaking is just as
relevant to bank accounts as credit cards.]
Quote=
Disguised penalties
4.21 The analysis in this statement is in terms of explicit, transparent default
fees. Attempts to restructure accounts in order to present events of
default spuriously as additional services for which a charge may be made
should be viewed as disguised penalties and equally open to challenge
where grounds of unfairness exist.12 (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
UTCCRs are concerned with the intention and effects of terms, not just
their mechanism. =Unquote
Aye sure is - the same one i used when writing to my bank - it pays to read that report - the banks really dont have an answer for it and the best they can do is to be dishonest with people writing to them reclaiming charges by suggesting that the OFT report doesn't apply to bank charges - even though it mentions them specifically and asks the banks to take note and change their practices. Make no mistake the banks are being, have been, and always will be dishonest. It really is quite amazing that they have got away with it for so long.
Claiming that the charges are a service
it actually stated the price of the charges, that therefore a price has been 'agreed'?
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