Birmingham Midshires Erc So It Begins! **SETTLED - 3/4 paid **

[biffa1965]

Well folks, thought Id just create a new thread, sent off prelim letter for my Birmingham Midshires ERC, I await with baited breath. Heres hoping I get the same success as Lickthewall and Thunderpuss. My claims for £3,786.99.

[zootscoot]

Good luck Biffa!

[ukaviator]

Hello Biffa.

 

I am going through the process with them now. Just follow the procedure and you should get it back. I have been offered half of my amount back. I have informed them that i will be pursuing the full amount through MCOL, and that the media attention, unlawful charges, etc will have to be explained. Just waiting for a call back this next few days with their intentions.

 

Good luck

 

Uk...

[biffa1965]

Cheers Ukaviator and thanks for the support Zoot. certainly the success we ve had from Birmingham Midshires. up to now has given me lots of confidence

[biffa1965]

Well folks they havent hung about. recieved first reply today. And what a wierd reply it is too. Iam sure theyre either playing for time or just ignorant. Anyway letter is

 

Dear sir

Thank you for your letter dated xxxx.

At Bm we take complaints very seriously and il answer you as quickly as possible. Il contact you no later than 4 weeks from 30th OCTOBER 2006. I may need this long to carry out a thorough investigation, but I do hope to respond earlier.

My understanding of your complaint is

You feel that the early repayment CHARGE is disproportinate to the costs that you actually incurred.Furthermore you believe that this PENALTY is unlawful at Common Law, Statute and recent consumer regulations.

Consequently you would like the early repayment CHARGE to be refunded.

 

please contact me if this is not correct

 

I enclose a copy of our 'voicing your concerns 'leaflet which gives details of out internal complaints procedure. please dont hesitate to contact me on below number...........

 

 

Now folks what do you make of that then.?????????

[biffa1965]

Re the above do you what do you folks suggest do i wait for a response or go to LBA if no contact forthcoming in next 14 days ?

[zootscoot]

Stick to your timetable Biffa.

[biffa1965]

Thanks very much zoot will do

[blackrain]

Got exactly the same letter Biffa. Then 2 replies for Prelim and LBA both stating it wasn't a penalty. They are stalling and you will get the same replies.

 

Zoot, when you filed your ERC claim did you stick to the same basic arguments as your letter? IE breach of contract/disproportianate penalty etc? Anything else that's a good idea to include?

[ukaviator]

Hi Team

 

The letter is the standard reply. I had the same thing. LBA them now and keep to your timetable.

 

Good luck

 

Ukaviator

[shovey]

Hi, ev1 i sent of my letter for repayment of ERC of midshires on 16th oct, they havent even bothered to answer me yet. Could someone post me a copy of there letter before action, so i can copy it. I looked on the templates but only found bank ones. please help.

[biffa1965]

Thanks blackrain and UKaviator,il certainly take our advice and observations on board.Could I be so cheeky enough to re terate Shoveys last post and request the same if i could be so bold.

[zootscoot]

LBA

 

 

LETTER BEFORE ACTION

 

Dear XXXXX,

 

ACCOUNT NUMBER: XXXXXX

 

 

 

We are very disappointed that you have failed to respond to our letter of the XXXXX relating to the repayment of the redemption fee of XXXX. Since paying the fee we now understand that such fees are unlawful and unenforceable as outlined in our previous letter. We would draw your attention to the terms of the contract which you agreed to at the time that we opened our account. It is an implied term of that contract that you would conduct yourselves lawfully and in a manner which complies with UK law.

 

We are frankly shocked that you have operated our account in this way as we had always reposed confidence in your integrity and expertise as our fiduciary. We require repayment in full of this money. If you do not comply fully within 14 days then we shall initiate court proceedings against you for the full amount, plus interest, plus costs and without further notice.

 

Yours faithfully

 

Particulars of claim

 

I am claiming the return of money taken by the defendant in the way of a redemption penalty charge on xx/xx/xxxx from account no xxxx. This charge relates to my breach of contract in that I terminated the contract before the agreed period. The defendant's charge for my breach is a disproportionate penalty and therefore unenforceable as it is contrary to common law as established in Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79. Further, as a disproportionate penalty it is invalid under the Unfair (Contracts) Terms Act 1977 s.4 and under the Unfair Terms in Consumer Contracts Regulations 1999. Para.8 and sch.2(1)(e). I have repeatedly asked the defendant to justify their charges but they have declined to do so.

[biffa1965]

Cheers for that Zoot, nice short and sweet...love it

[biffa1965]

BM have been LBA today. Heres hopin...lol

[UnhappyBunny]

I got a knock back from my intial letter and LBA, have filed an MCOL earlier in the week though.

[lickthewallfatboy]

they took me right to the 28 day deadline on MCOL-the day any defence was to have been filed.I got my settlement letter that day!!

 

stick to your guns-you'll get a nice little early christmas present...

[biffa1965]

Cheers Lickthe wall, as it happens folks ive received my reply to LBA today.They havent hung about!. The jist of it is the tired old terms and conditions argument. A Denial that any part has breached the contract and somethin about 'equity to redeem'. A Load of crap I know. Never the less il be scanning it on here later tonite whereupon i would appreciate the usual advice. Especially from our resident genius the wondeful Zoot.....Cheers Folks

[biffa1965]

Folks this is the letter I have received to day from the bM in response to my erc claim LBA.

 

Further to your letter dated 31st october 2006, im sorry to hear your unhappy

Our understanding of your compliant is:

you feel the erc is disproportionate to the costs that you actually incurred.Furthermore you belive this penalty is unlawful at Common Law, statute and recent Consumer regulations.

Consequently you would like the ERC to be refunded.

Having reviewed your case,I confirm that following an application being submitted, amorgage offer giving details of morgage product QLA-5.49% Fixed to 01/06/2006, then bank of england base rate+1.95 was issued to you on 28th March 2003. Following your acceptance of the offer, your morgage was set up on 16th April 2003 in accordance with the terms and conditions stipulated within the morgage offer. As you are aware, the offer confirmed that ERC Charges would apply if your morgage was partially or fully repaid while the morgage was still within its 'tie in' period-three yrs after completion of the loan. Ive enclosed a copy of the offer for you to refer to.

Our records show that your morgage was redeemed on 9th December 2004 and in line with the information above, you paid ERC of £3,138.57.

With regards to your request for a breakdown of how our ERC are calculated, we confirm that this is COMMERCIALLY SENSITIVE INFORMATION. Consequently, we are not obliged to divulge this information to you, however we apologise for any inconveniance this may cause.

Turning to your comments and the statement you have referred to in your letter of 28th Ocober 2006. I would like to point out that niether imposing ERC on your account or early redemption of the account constitutes a breach of contract on either your part or ours. The morgage conditions under which your morgage was set up confirm that a customer is entitled to repay their loan, either partially or in its entirety, at any time. Section 6.1 of morgage conditions 2000, a copy of which is enclosed, states 'the borrower may repay all or any part of the morgage debt at any time before the end of the morgage period'

Furthermore there is a right in 'equity to redeem' which allows customers to redeem a debt at a time which pre dates the contractual redemption date. It would be unlawful for us to exclude the right to redeem, as known by the rule that there should be no 'clogs on the right of redemption'

Consequently you have not breached the contract by redeeming your account early, but simply exercising your right in 'equity to redeem'. I can only suggest that you seek independent legal advice if you wish to pursue the matter further.

Based upon this information, i am unable to uphold your complaint as the morgage offer clarly stated that ERC would be applied to your account, if you partially or fully redeemed your morgage prior to the end of its 'tie in' period. As a result of this, I cannot agree to refund the applicable ERC, as this would contradict the information contained within the offer document.

I hope this outcome resolves the matter. However if you are not satified with the outcome of my investigation, you may request our Customer Services team to issue a 'final response'. A final response letter means you have come to the end of our internal complaints procedure. This then enables you to refer your complaint to the Financial Ombudsman Service. For your information I have enclosed the FOS explainatory leaflet entitled 'your complaint'

I hope that we are able to reach an agreeable conclusion to this matter any questions or queries etc etc

 

Well folks how do I respond to that one then....have we any temples...lol any help much appreciated. Their argument seems like 'old hat' to me

[gizmo111]

you feel the erc is disproportionate to the costs that you actually incurred.Furthermore you belive this penalty is unlawful at Common Law, statute and recent Consumer regulations.

 

They still don't get it do they - it is the costs that they incurred not you. Are they admitting that this is a penalty charge here?

 

Try modifying bits of thsi letter that are applicable to you.

 

Thank you for your letter of 04 October regarding Early Repayment Charge of £5020.03, which was made on the above account.

I refer to the following statements in your letter

As quoted from the office of fair trading ' Terms in consumer contracts which set the price or define the product or service being supplied are 'core terms' of the contract and are exempt from the test of fairness as long as they meet the plain language requirement' I've enclosed the copy of the special conditions and would refer you to point 11 which I have highlighted. This section of the contract details our tariff of fees and in signing this document you’ve agreed to these charges.

Your terms and conditions at the point of redemption clearly state that there would be an Early Repayment Charge applicable.

It is my belief that the Early Repayment Charge is in fact a penalty for breach of contract rather than as suggested by yourself a charge for the supply of a service or product in that we terminated the mortgage contract before the contractually agreed period of 25 years.

 

This term of the contract was clearly stated in the written mortgage offer signed by myself and xxxxxx. The terms of which were incorporated by reference into the mortgage deed which was not only signed by us but also witnessed. There is clearly no room for doubt that such a clause existed in the contract. Similarly, there is no question that we in fact redeemed the mortgage on the 30/04/2004 as evidenced by our final redemption statement. This date is clearly well before the contractually agreed date of 25/06/2028 and thus represents a clear breach of the contract.

My letter to you dated 18th September does in fact draw your attention to other statements from the Office of Fair Trading, and also relevant statute and common law. May I suggest that you familiarise yourself with the legal principles outlined in that letter so as to be sure that you understand the legal basis for my request for repayment of the Early Redemption Charge, of £5020.03.

Since paying the fee I now understand that such fees are unlawful and unenforceable as outlined in our previous letter. We would draw your attention to the terms of the contract which you agreed to at the time that we opened our 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 our account in this way as we had always reposed confidence in your integrity and expertise as our fiduciary. We require repayment in full of this money. If you do not comply fully within 14 days then we shall initiate court proceedings against you for the full amount, plus interest, plus costs and without further notice.

 

Yours faithfully,

[biffa1965]

Giz first and foremosy a big thank you for your last templete letter, i will certainly write back and address the points theyve raised i too was baffled by the openeing lines of their letter. I have aleady LBA them so i dont know wether to consider that as my reply and move on to MCOL. What do you suggest ? or should i address their last letter before MCOL?

[gizmo111]

Giz first and foremosy a big thank you for your last templete letter, i will certainly write back and address the points theyve raised i too was baffled by the openeing lines of their letter. I have aleady LBA them so i dont know wether to consider that as my reply and move on to MCOL. What do you suggest ? or should i address their last letter before MCOL?

 

 

Straight to claim bif - they have said no and are at end of procedure - you have sent LBA - so no point keep adddressing their pointless arguments.

[biffa1965]

MCOL Submitted today Folks

[gizmo111]

MCOL Submitted today Folks

 

Nice one

[UnhappyBunny]

Folks this is the letter I have received to day from the bM in response to my erc claim LBA.

 

Further to your letter dated 31st october 2006, im sorry to hear your unhappy

Our understanding of your compliant is:

you feel the erc is disproportionate to the costs that you actually incurred.Furthermore you belive this penalty is unlawful at Common Law, statute and recent Consumer regulations.

Consequently you would like the ERC to be refunded.

Having reviewed your case,I confirm that following an application being submitted, amorgage offer giving details of morgage product QLA-5.49% Fixed to 01/06/2006, then bank of england base rate+1.95 was issued to you on 28th March 2003. Following your acceptance of the offer, your morgage was set up on 16th April 2003 in accordance with the terms and conditions stipulated within the morgage offer. As you are aware, the offer confirmed that ERC Charges would apply if your morgage was partially or fully repaid while the morgage was still within its 'tie in' period-three yrs after completion of the loan. Ive enclosed a copy of the offer for you to refer to.

Our records show that your morgage was redeemed on 9th December 2004 and in line with the information above, you paid ERC of £3,138.57.

With regards to your request for a breakdown of how our ERC are calculated, we confirm that this is COMMERCIALLY SENSITIVE INFORMATION. Consequently, we are not obliged to divulge this information to you, however we apologise for any inconveniance this may cause.

Turning to your comments and the statement you have referred to in your letter of 28th Ocober 2006. I would like to point out that niether imposing ERC on your account or early redemption of the account constitutes a breach of contract on either your part or ours. The morgage conditions under which your morgage was set up confirm that a customer is entitled to repay their loan, either partially or in its entirety, at any time. Section 6.1 of morgage conditions 2000, a copy of which is enclosed, states 'the borrower may repay all or any part of the morgage debt at any time before the end of the morgage period'

Furthermore there is a right in 'equity to redeem' which allows customers to redeem a debt at a time which pre dates the contractual redemption date. It would be unlawful for us to exclude the right to redeem, as known by the rule that there should be no 'clogs on the right of redemption'

Consequently you have not breached the contract by redeeming your account early, but simply exercising your right in 'equity to redeem'. I can only suggest that you seek independent legal advice if you wish to pursue the matter further.

Based upon this information, i am unable to uphold your complaint as the morgage offer clarly stated that ERC would be applied to your account, if you partially or fully redeemed your morgage prior to the end of its 'tie in' period. As a result of this, I cannot agree to refund the applicable ERC, as this would contradict the information contained within the offer document.

I hope this outcome resolves the matter. However if you are not satified with the outcome of my investigation, you may request our Customer Services team to issue a 'final response'. A final response letter means you have come to the end of our internal complaints procedure. This then enables you to refer your complaint to the Financial Ombudsman Service. For your information I have enclosed the FOS explainatory leaflet entitled 'your complaint'

I hope that we are able to reach an agreeable conclusion to this matter any questions or queries etc etc

 

Well folks how do I respond to that one then....have we any temples...lol any help much appreciated. Their argument seems like 'old hat' to me

 

SNAP! I got the same letter from them before I LBA'd and then filed my MCOL.