Hello,

I have never posted before now. I am owed aprox. £2100 from the Royal bank of Scotland in unfair charges. As I live in Scotland I decided to split this into 3 small claims.

My first small claims went to court this morning (17/11/06). I must admit i wasnt as prepared as i should have been. I had heard of the banks not turning up or settling at court so I was not too worried.

Prior to the court date I did recieve an offer over the phone from Jonny Nisbet ([email protected]) who i believe is a trainee solicitor for RBS offering me £310 goodwill gesture to drop the case (the full amount i was claiming for in this case came to over £1000 with interest and court fee).

I rejected this offer.

In Court this morning RBS solicitors?? said to the judge the offer still stood and that if it was not accepted they would give their defence. Again I turned down the offer.

They then entered this defence taken word for word:

'The charges have been applied in accordance with the terms and conditions of the banking contract between the Bank and Mr XXXXX. The charges are both transparent and fair and reasonable and represent a genuine estimate of the cost to the Bank in administering the said defaults. In addition, Mr XXXXX's claim for charges in the period 7/7/2000 - 15/8/2001, being charges levied more than 5 years prior to the date of service of the summons on the bank, has prescribed. Being more than 5 years these are now time-barred'

I was then asked by the judge if I wanted to go to a date for proof. I said yes and was asked to supply documents for this. I am unsure what they mean by this. The date has been set for 19/01/07. It seems a long time away. The first date i was given took only 3-4 weeks.

Has anyone been this far with the RBS? What do I need to do now?

Can anyone please help. Has anyone else had to go to court with RBS or recieve a date for a second hearing?

hi eubo,

im confussed by this in scotland we are limited to being able to go back five years on claims six years is for england. i realise this can be challenged and perhaps this is what you will have to do? could you explain further why you are claiming these dates and your reasoning?

At first it was me being naive about the Prescription and limitation act (Scotland) 1973. I did not realise there was a 5-year limit.

However, after further research I have found that if the pursuer was unaware a breach took place that the 5-year limit would start from when I discovered the breach had taken place. This can be up to 20 years after the breach.

In hind site I would have only claimed for 5 years but I still think I have a good argument and will give it a go.

My only worry is giving the Bank too much ammo and having the case thrown out.

I was very surprised that the bank turned up to the first hearing and a bit unprepared but want to make sure im ready for the next hearing in Jan if they dont settle before then.

i am surprised as well ill do my best to get a mod or sh to look at this for you later.

Eubo,

There are two limits, 5 years and 20. The starting date for the five year limit can be postponed in certain circumstances such as where the claimant was not aware and could not with reasonable diligence have become aware of their right to enforce an obligation on another. The twenty year limit applies irrespective of knowledge, i.e. it cannot be postponed. In most cases the five year limit will apply, and in those cases where the puruser could have pled the postponement of the five year period, their claim will prescribe in twenty years regardless of whether they knew or could have known etc.

It is confusing, I know, but five years does apply in these cases.

It is confusing, I know, but five years does apply in these cases.

Not "does", "might".

Eubo, have a read of this:

http://www.consumeractiongroup.co.uk/forum/post-332152.html

Then decide for yourself how you want to proceed.

Robertxc is our Scottish moderator and very knowledgeable. I'l ask him to have a look at your thread, see if he has any advice.

Advocate believes that you cannot go beyond five years because a 'reasonably' diligent person could have known that penalty charges were unlawfull all along, so you cannot say that you just found out about it. I would beg to differ.

While it is true that (however unlikeyl) you could have known that penaly charges are unlawful, you could not possibly have known that the banks charges were penalties. his is because:

A. The banks, to this day, keep the breakdown of thier costs strictly confidential.

B. If you were to ask them for a breakdown, they would tell you to get lost.

...and C. They swear blind that their charges are not penalties.

For me, they key event was the OFT's statement earlier this year to the effect that they consider the banks charges to be excessive.

I suggest you read the thread mentioned above, and make up your own mind. For your information, I've claimed beyond five years and still had settlement from the bank.

thanks for the replies. My other worry is that they stated in court:

'The charges are both transparent and fair and reasonable and represent a genuine estimate of the cost to the Bank in administering the said defaults'

But how can they say this without giving a breakdown. Should i be requesting the judge ask for this because my attempts to get it directly from the RBS has failed.

the simple answer to this is they can say whatever they like however you should ask them to prove this in court. the judge can order them to disclose their costs and this is imo what you would be looking for.

the simple answer to this is they can say whatever they like however you should ask them to prove this in court. the judge can order them to disclose their costs and this is imo what you would be looking for.

my appologies robert and eubo i stand corrected. many thanks. is it not the case though that we are looking for the banks to disclose cost? please dont think im being cheeky i just have picked something up wrong and would like to get it shraight in my own head

Eubo, you have my every sympathy, facing them in the Court is I am sure everyone's worst nightmare, but there's enough support on here for everyone to be properly prepared, so no excuses there then!

BTW, is anyone else here concerned that RBS might be trying to make a test case out of this one???? :o And should we all panic, sorry, monitor very carefully and offer Eubo all the support possible??

BTW, is anyone else here concerned that RBS might be trying to make a test case out of this one???? :o And should we all panic, sorry, monitor very carefully and offer Eubo all the support possible??

Hold on.

DId they put the Defence in writing? If they did then I think has to be lodged with the Sheriff Clerk some period PRIOR to the preliminary hearing (7 or 14 days). I am pretty sure they just can't turn up and hand in their written Defence.

they have to submit their defence of 14 days before the proof hearing. It always takes longer for the proof hearing than it does for the preliminary hearing.

Thanks everyone for the feedback. I know they have to submit their defence 14 days before the Proof hearing but do I not have to submit my case by then as well. How should I prepare this and what should I be submitting?

Bump:confused:

Thanks everyone for the feedback. I know they have to submit their defence 14 days before the Proof hearing but do I not have to submit my case by then as well. How should I prepare this and what should I be submitting?

Hi there,

I saw RBS in court today for my preliminary hearing, at the sheriff court in Edinburgh. Essentially they backed down completely and tomorrow hopefully I'll be getting the cash in my account. However, In preparing my case on the assumption they were going to defend, I found some interesting evidence which I was planning on entering if the hearing went to proof, which hopefully will be of some use to you. Have a look at page Ev39 (oral evidence) of this document:

http://www.publications.parliament.uk/pa/cm200405/cmselect/cmtreasy/274/274.pdf

Essential points made by RBSs chief executive sir Fred Goodwin here are:

Q415 answer ' The costs are going to pay for all the people we have who pursue debt, collect debt, speak to customers and chase payments. The way these charges are arrived at is by taking these total costs and making some assumptions about the volume that is going to come through to arrive at the individual charges'

Q417 answer 'Self-evidently, it is the same charge for everyone. They are not individually costed to each individual customer. That simply is not feasible. There are assumptions made blah blah...'

In other words, the charges on your account (in part, it is admitted by FG) go to subsidise RBSs global debt recovery losses. They are not allowed to do this. I am fairly sure under the law they are only allowed to charge you the losses that YOUR conduct causes them, which are negligible.

I believe since the source is parliamentary this evidence is admissable. Send a copy of the relevant pages to the court and the defender and say you plan to call on the document as evidence in the hearing. Interesting to see what their response would be in court, if it goes that far.

Good luck! Although I'm sure you wont need it, I bet they cave at the last moment.

Yakobb

You say:

" In other words, the charges on your account (in part, it is admitted by FG) go to subsidise RBSs global debt recovery losses. They are not allowed to do this. I am fairly sure under the law they are only allowed to charge you the losses that YOUR conduct causes them, which are negligible."

This is an interesting point, but what makes you sure that they are not allowed to do this?

Dunlop Pneumatic Tvre Co. v. New Garages and Motor Co.:

It was further noted in Dunlop that “There is a presumption (but no more) that it is penalty when a single lump sum is made payable by way of compensation on the occurrence of one or more or all of several events, some of which may occasion serious and others but trifling damage”.

Robertxc,

Nice to hear from you again, but I am not sure how that answers the question. If the Banks are not allowed to average it out, then there has to be an argument why not. This piece of judicial opinion does not say that. It simply states that there is a rebuttable presumption of fact about lump sum compensation provisions following on from certain events. It says nothing about the way in which an organisation can organise its debt recovery. I am not denying the proposition, merely interested to know how it would be supported.

Bank charges are not legally enforceable if they are penalties. Penalty clauses in contracts in English (and Scottish) law for breach of contract are not legal if the penalty exceeds the actual cost of the breach of either party. The law relating to penalties has been established through case law. The cases date back to the nineteenth century and the courts have been consistent in the way that they have ruled on penalty clauses.

Such cases include, Wilson v. Love (1896), Dunlop Pneumatic Tyre Co. Ltd. v. New Garage and Motor Co. Ltd. (1915), Ford Motor Co. v. Armstrong (1915), Bridge v. Campbell Discount Co. Ltd. (1962) and Murray v. Leisureplay (2004)

There have been several other cases over the past century. Any good book on contract law or business law will contain references to "penalty clauses", "penalties" or "liquidated damages" cases and a discussion of the law.

The sums charged by banks, credit card companies, loan companies and others are in most cases arbitrary sums and they bear no relation to the actual loss suffered by the company for the contract breach and therefore do not need to be paid.