Midland Business Acc Pre 1990- Charges Led To Bankruptcy

[thereshope!]

Hi

I am posting on behalf of my mother and father -in-law and wanted to know if they may have a chance of claiming back compensation and bank charges.

 

I apologise in advance for what will be a lengthy post but please bear with me as I feel it is relevant.

 

My in-laws ran a very sucessful wholesale business throughout the 80's but were basically victims of their own success.

As they expanded they needed a bigger warehouse so purchased one for £250K .They also needed more salesmen and reps, so signed up for vans and cars with Ember on a contract hire basis .

 

When the going was good, Midland Bank were all over them like a rash and actually relied upon the daily cash takings from the business to use as cash flow in the local branch.

Many times the manager would call my mum-in law up and ask if she would be banking any cash deposits as the branch was short.

She usually banked £15k a day in cash plus very large amounts in cheques.

In fact, the manager was always on the phone inviting them to social events etc.

A real friendly guy.

 

Basically, everything was sweet until the interest rates rocketed to 15% .

At the same time, the vans that were supplied by Ember ,VW Lutons , appeared to have serious faults with the engines and 3 of the vans were continously breaking down.

Ember didnt manage to fix the vans witout delay and didnt provide courtesy vans so that business could continue as normal and quite often the 3 vans would be off the road and takings were dramatically down.

 

As a result of Ember not being able to fulfil their contract and keep the vans on the road and the interest rates going to 15 %, cash flow quickly beacme a major problem.

 

Midland Bank offered no support at all and slashed the business overdraft amount from £80K to £40K when they realised there was a problem and as a result, charges snowballed at an astonishing rate.

 

 

When the o/d was cut to £40K , it happened overnight. They received a phonecall in the afternoon advising it would be reduced as of the next morning.

 

Ember eventually got the vans sorted and had new engines fitted to each, but it was too late and by then the business was going down fast.

 

My father in law attempted to get out of the contract with Ember(he was one year into a three year contract) on the basis that they had failed in their obligation to keep the vans road worthy,but Ember wouldnt budge.

 

Solicitors advised my in laws to file for Bankruptcy .

 

They lost everything.

The family home,the business premises and 1o's of 1000's in stock.

They ended up living in a static caravan where they still are today.

 

My in-laws think I am mad to even consider that they may have a claim and they are probably right.

 

But what if.................. ?

 

If anyone knows of a claim that is ongoing at the moment for similar circumstances, or wants to comment in general I would really appreciate it.

 

I dont know how I should go about this !

 

What should I do as the only information I have is that it was a Midland business account ?

 

There is also the 6YR statute of limitation to take into account.

 

 

 

This really does have the potential to be life changing

 

 

Hope xx

[thereshope!]

please, any advice or comments would be really appreciated on this guys.

 

Thanks

Hope xx

[rippedoffagain]

Sorry to be negative, but if you do not have access to documents regarding the above, I don't see what you can do. Midland (HSBC) may have the documentation, but how you would get it out of them I don't know. If the business was a Limited Company, I think it would be impossible. If it was a partenership, then you could try a Subject Access Request.

 

Best of luck.

[photoman]

Hope,

Even the tamest words I really wish to post to describe the banks would resulted in my post being edited !!

Firstly, come and join a thread I've just started. Set up for business claimants to offer more business specific help advice and discussion to each other.

 

http://www.consumeractiongroup.co.uk/forum/general/68191-claiming-business-account-lets.html

 

Regards your story:

(Please account for the fact that I am not a legal expert, and the following comments are my own, mostly formulated as a result of reading similar posts on this site)

 

1/ As a company I am sure they must still have all the accounts/ If not then maybe the accountant does? Otherwise the receivers upon bankrupty may have taken them?

 

2/ As the company is in receivership, I think there could be an obligation to declare any new income and pay any money recliamed to the recievers/creditors first. Suggest you look into this before starting any action.

 

3/ A lot of claimants are now challenging the pre 6 year rules with succes. My view is that the charges were always unlawful, and that with their access to so much proffesional legal help when drafting up the contracts they must have either:

a/ Known the unlawfullness of the charges, and concealed such facts. This means that sec 32 of the Statutes of limitations act comes into play lifting the 6 year bar.

b/ Alternatively, if they try to claim that they genuinely did not know,then such a declaration of their own/legal teams incompetance/ignorance might get them off the hook......but would not bode well for business, and their customers would leave in droves! Not a declaration I see them making too hastily !

 

So dammed if they do try to claim ignorance of the law, and dammed if they dont !!!

 

Regards pursuing the claim. It sound as if your in laws have absolutely nothing left to lose, and everything to possibly gain.

 

I would also suggest perhaps that you consider proffesional legal advice on this, as there are some issues that are beyond the scope of normal small claims. How you find such help is upto yourselves, but I would advise avoiding the masses of "no win no fee" companies and seek some help and suggestions from some form of official body.

 

 

I wish you the most heartfelt good luck in this

[stevesj]

Photoman your post makes sense to me - I too was (my own business) made bankrupt in 1992 due to 16% interst rates and the highest rates of bankruptcies known for many a year. Nearly lost everything and had to fight to retain the right to live in my own house (the interst rates at the time left little equity) and when I came to cash in my endowments - all hell let loose, as we found they were the Official Recievers property! - after a lengthy battle with the OR and an expensive solicitors bill, I managed to relase the endowments to cash in (too lengthy to post). Nat West took my business by making me a usary, piling on charges - I've lookd at 6 months worth of statements near the end (1992), and even then they cost me £2000- goodness knows how much previously. If nothing else, at pre- 1990 the banks did have some manual intervention, as most notifications were hand written proformas. Even so - £20 for a failed DD and £12 for the letter!!!! If only.... i too have considered looking at a SAR for these accounts, but haven't the courage to take up.

 

Best of luck

 

Steve