At last!

I have just received a call from Barclays litigation department saying they will settle in full. They asked if I had entered my request for judgment which I had only this morning!

He was a bloody nice bloke (seemed very down to earth and not bitter in the slightest) and went on to say he will contact the court to try and sort settlement out of court. If successful they will write and I will have to sign something to say they have settled.

Just to say what a great website and thank you to everybody who is involved in the set up and all those who have helped me along the way. I will be donating as soon as funds have cleared. Please forward link to do this. I will confirm the settled claim so as to be recorded on the site win counter.

Any last bit of advise is welcome.

Cheers all

Yeeeeeee haaaaaa!

Update

The court wrote me a letter saying the banks defence will be struck out at 4pm on the 15th of May if they don't comply to the Judges order.

They haven't complied,

I win, I get all my money back plus interest! right?

What happens now, do I just wait to hear from the court again?

Should I contact the court or bank?

I thank you

Slow progress!

Shall I phone the court?

I sent my bundle to the bank and court over 4 weeks ago.

After 2 weeks the bank had not complied to the judges orders so I wrote to Barclays as per the template. After the 7 days elapsed I wrote to the court complaining, as per the template. It has now been a week and I have heard nothing.

Please advise

I opened my account in Watford but sent all my letters to Barclays head office in London (addresses available on this site in FAQ). Still I'm sure what you have done is fine.

Your complaint will be forwarded accordingly and you'll hopefully receive a positive reply, if not, continue your correspondence with the address given on the replied letters and keep to the times set out.

All the best

Who will be so kind as to check this -

STATEMENT OF EVIDENCE

1. The claimant submits that the charges levied to his bank account, as set out in the enclosed schedule, are, notwithstanding the defence of the defendant, default penalty charges imposed because of and relating directly to breaches of contract, both explicit and implied, on the part of the claimant. As a contractual penalty, the charges are unenforceable by virtue of the Unfair Terms in Consumer Contracts Regulations 1999, the Unfair Contracts (Terms) Act 1977, and the common law.

2. It is admitted that the Defendants charges were levied in accordance with the terms and conditions of the account in question. However, it is submitted that the Defendants charges are not related to or intended to

represent any actual loss arising from a breach of contract, but instead unduly and extravagantly enrich the Defendant which exercises the contractual term in respect of such charges with a view to profit.

3. The breaches of contract in this case relate to exceeding overdraft limits, and having insufficient funds

available to pay a direct debit or a standing order. On one occasion in June 2006 , due to my account

temporarily exceeding my overdraft limit by just few pounds I was penalised three times in just three days for these breaches by way of a charges totalling £90 . The claimant holds these charges and indeed every other charge in question, to be punitive in nature, and wholly disproportionate.

4. The law states that a contractual party cannot profit from a breach and the charge for a loss suffered from a breach of contract should be the amount necessary to put both parties in the same position before the breach occurred. This means that Liquidated damages should be charged. This is backed up by case law – Robinson Vs Harman 1848.

5. It is settled law that the charge for loss or damage arising from a breach of contract must be proportionate to the loss incurred.

6. Lord Dunedin stated in the case of Dunlop Pneumatic Tyre Co v New Garage & Motor Co 1915 -

“the sum is a penalty if it is greater than the greatest loss which could have been suffered from the breach” and;

“The essence of a penalty is a payment of money stipulated as in terrorem of the offending part; the essence of liquidated damages is a genuine covenanted pre-estimate of damage”

7. Further, under the Unfair Terms in Consumer Contracts Regulations 1999, schedule 2 (1) includes to define an example of an unfair clause as;

(e) requiring any consumer who fails to fulfil his obligation to pay a disproportionately high sum in

compensation;

8. It is not disputed that the Defendant is entitled to recover its damages following the claimant’s breach of

contract, and it is entitled to include a liquidated damages clause.

9. In order to ascertain whether the Defendant’s charges are an unenforceable penalty or are liquidated

damages, the true costs incurred by the Defendant need to be thoroughly examined to establish whether or not the banks charge represents a genuine pre-estimate of its likely loss incurred by my contractual breaches.

10. On numerous occasions, the Claimant has requested that the Defendant justify its charges by providing details of the costs incurred as a result of my contractual breaches. Each time those requests were rebutted or ignored.

11. In a recent study undertaken in Australia, (Nicole Rich, “Unfair fees: a report into penalty fees charged by Australian Banks”) it was estimated that the cost to an Australian Bank of a customers direct debit refusal was estimated to be in the region of 54 cents. By reviewing the banks’ charges against the above figure, the study estimated that banks could be charging between 64 to 92 times what it costs them to process a direct debit refusal. The study’s key findings stated that in its opinion the Australian Bank’s cheque and direct debit return charges were likely to be penalties at law.

12. Further, in an American study (Consumer Federation of America “Bounced Cheques: Billion Dollar profits II”) it was estimated that the American banks’ cost to process a returned direct debit payment was between US$0.48 and US$0.65.

13. The Defendant, or indeed any of the UK banks, has never published any information to support how their charges are calculated, or what their actual costs associated with such breaches are, or what revenue they derive from such charges.

14. For their recent BBC2 documentary “The Money Programme”, the BBC appointed a commission of former

senior banking industry figures and business academics to attempt to ascertain the actual costs to the UK banks of processing a customer’s breach of contract. They concluded that the absolute maximum conceivable cost that could be incurred by a direct debit refusal or overdraft excess is £2.50, and of a returned cheque £4.50. They did state however, that the actual cost is likely to be much less than this. The commission also estimated that the UK banks collectively derive as much as £4.5billion in profit a year from their charging regimes.

15. It is submitted that the Defendants charges are applied by an automated and computer driven process. It is therefore impossible to envisage how the Defendant can incur costs of £20-35 by carrying out a completely automated and computer driven process. This process consists of a computer system ‘bouncing’ the direct debit, and sending out a computer generated letter.

17. Additionally, I asked the Defendant to provide me evidence of any manual intervention that may have occurred in relation to my account, under a Data Protection Act 1998 right of subject access request. No such information was forthcoming.

18. The claimant also cites a radio interview in 2004 with Lloyds TSB’s former head of personal banking, Peter McNamara, in which he states the charges are used to fund free banking for all personal customers as a whole.

19. The claimant cites the statement from the Office of Fair Trading (April 2006), who conducted a thorough

investigation into default charges levied by the British financial industry. While the report primarily focused

on Credit card issuers, the OFT stated that the principle of their findings would also apply to Bank account charges. They ruled that default charges at the current level were unfair within their interpretation of the UTCCR’s.

20. On 22nd May 2006, the house of commons passed an early day motion which welcomed the OFT's statement that default charges should be proportionate to the actual loss incurred. The house discribed such default charges as "exorbitant" and "excessive".

21. Further, under the UTCCR:

5. - (1) A contractual term which has not been individually negotiated shall be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties' rights and obligations arising under the contract, to the detriment of the consumer.

(2) A term shall always be regarded as not having been individually negotiated where it has been drafted in advance and the consumer has therefore not been able to influence the substance of the term.

(3) Notwithstanding that a specific term or certain aspects of it in a contract has been individually negotiated, these Regulations shall apply to the rest of a contract if an overall assessment of it indicates that it is a

pre-formulated standard contract.

(4) It shall be for any seller or supplier who claims that a term was individually negotiated to show that it was.

Schedule 2 also includes such clauses (to define examples of unfair clauses) as:

(i) irrevocably binding the consumer to terms with which he had no real opportunity of becoming acquainted before the conclusion of the contract;

(j) enabling the seller or supplier to alter the terms of the contract unilaterally without a valid reason which is specified in the contract;

(m) giving the seller or supplier the right to determine whether the goods or services supplied are in conformity with the contract, or giving him the exclusive right to interpret any term of the contract.

22. The defendant is a multi-national corporation. The term regarding charges was inserted unilaterally in

contract. The contract was pre and mass produced and I had no opportunity to negotiate the clause, or indeed any of the contract.

23. The cost of Barclays charges have increased twice during the period in which my account was held, neither time was I given the opportunity to negotiate, or even notified of this increase. This means the bank has

unilaterally altered the terms of my account contract to my detriment, and to their advantage.

24. As pleaded above, the Claimant believes the charges levied to his account to be disproportionate

contractual penalties. The Claimant will vehemently refute any contention that they are legitimate contractual service charges which are as such not required to be a pre-estimate of loss incurred on the part of the Defendent. The Claiment believes any such contention to be an attempt by the Defendent to 'cloak' its penalties, in order that it circumvent the statutory and common law provisions which prohibit contractual penalty charges with view to profit.

25. The Claimant submits to this honourable Court that a charge of £25, £30, £35 etc (whatever is applicable) for the administration resulting from the Claimant going over his authorised limit by £1 is,nt reasonable by any stretch of the imagination. The same can be said for a charge of £30 for an item returned unpaid.

Furthermore the charges regardless of their de facto nature are unfair by virtue of Reg 5(1) of the UTCCR. Particular ref is made to the fact that any term of contract which purports to allow the Defendant to levy the charges to the account, contrary to the requirement of good faith causes a significant imbalance in the parties " rights and obligations", arising under the contract to the detriment of the Claimant , who in this case is a consumer.

26. The Claimant refers to the statement from the Office of Fair Trading (April 2006). With regard to the ‘cloaking’ or disguising of penalties, the OFT said this;

“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. (For example, a charge for ‘agreeing’ or ‘allowing’ a customer to exceed a credit limit is no different from a customers default in exceeding a credit limit.) The UTCCR’s are concerned with the intentions and effects of terms, not just their mechanism”.

27. However, and without prejudice to the above, in the event that the charges were accepted as being a fee for a service, the claimant submits that they are unreasonable under section 15 of the Supply of Goods and Services Act 1982.

28. As set out above, the Defendant’s charges cannot be considered to be liquidated damages, nor contractual service charges. They are not a pre-estimate of, or in any way related to, the Defendant’s loss incurred as a result of the breach of contract. The charges are punitive, and unduly, substantially and extravagantly enrich the Defendant. As such, they are disproportionate contractual penalties and unenforceable at law.

I, the Claimant, believe all facts stated to be true.

Signed

Hijack away!

It seems that the Judges directions are varying quite a bit. Some are using the new strategy directions some are not. Some courts are asking for complete bundle to be sent within 2 weeks and others 2 weeks before hearing.

Penny is your case a block hearing?

I'm sure the courts know these cases will never enter the court house!

You could probably send a few copies of Tractor Weekly and the Beano and nobody would notice. Although not advisable!

Its all becoming very tidious, I just want my money back, now!!

It seems that Barclays are sending out letters 2-3 weeks before court hearing with settlements.

I've had to prepare my court bundle as it is needed by 23 March(fri).

I think I should make copies and post them tomo as I have doubts that Barclays will settle before early May (court hearing 22 May).

Hi Penny

Sorry for late reply, computers been playing up!

I'm sending the whole finished bundle to both the bank and court.

Don't send/bring anything else to the court you have'nt sent to the bank or visa verse.

A4 ring binder is fine. Use a few dividers to seperate sections.

Run the bundle in an tidy order to help your statement of evidence. The more prepared and organised it looks the more likely a faster settlement I guess!

I'm going to give barclays a call tomo or tues as Leech has advised!

Take care

Thank you very much Leech you have been top help so far.

I must seem a bit nervous! JUST IN CASE! keeps running around my head.

I am almost there now. Just have to make copies but I'm not going to waste my time with that until Mon/Tues, post Wed. I'll have the weekend to check through and organise my folder. Copies are required next Friday 23rd.

One more piece of advise - The OFT has printed out 30 odd pages. Do I need to send/bring the whole report or just the pages I refer to in my statements etc? does this also apply to the UTCCR etc.

I'll be out of your hair soon!

Much appreciated

Also... Am I a pain or what!

I believe the facts stated within this Witness Statement to be true and exhibit Exhibits [your initials 1] comprising of xx pages.

What does the highlighted bold writing mean at the bottom of Witness satement?

Ta

Thank you Leech

Where would you add the above paragraph on GaryH's 'GENUINE PRE-ESTIMATE' STATEMENT'.

http://www.consumeractiongroup.co.uk/forum/general/53570-new-strategy-allocation-questionaires-3.html#post482194

Cheers

Hi Leechthebreach

Thanks

1,2,3,4 not in court bundle!!

Para 5 od Barclays defence -

5. Accordingly, it is denied that the legal principles relating to liquidated damages clauses and penalty charges are relevant or applicable to the facts set out above. Further or alternatively it is denied that any such charges constitute unlawful penalty charges or are in breach of the Unfair Terms in Consumer Contracts Regulations 1999 (particularly but without limitation to, paragraph l(e) of Schedule 2), or are in breach of s.4 of the Unfair (Contracts) Terms Act 1977 (or any other provision), or are unreasonable within the meaning of s.15 of the Supply of Goods and Services Act 1982 (or indeed any other provision)

Just to make things clearer as to what help I need.

1. Where can I find the case law for Robinson Vs Harman 1848 ?

2. I can't seem to find the following quotes in the court bundle/relevant case law - pneumatic tyre v new garage motor co 1915 -

“the sum is a penalty if it is greater than the greatest loss which could have been suffered from the breach” and;

“The essence of a penalty is a payment of money stipulated as in terrorem of the offending part; the essence of liquidated damages is a genuine covenanted pre-estimate of damage”

3. The link for Nicole Rich, “Unfair fees: a report into penalty fees charged by Australian Banks

is not working, do you have a new link?

4. Do you have/will I need the American study - Consumer Federation of America “Bounced Cheques: Billion Dollar profits II ?

5. I don't have any Automated charge notification letters. Is this a big problem or do you have any advise?

6. Regarding your telephone conversation paragraph - I have had conversations/arguments with Barclays in the past about charges but haven't requested proof/recordings etc. any advise - shall I just delete or pretend I have requested justified proof of charges on the phone?

7. I need to add a couple more paragraphs regarding Barclays standard defence, paragraph 5! Do you have any suggestions or know of anyone who may have a draft I could use?

Cheers

Barclays replied to me within a week after receiving the letter you mention They offered me half the amount I was asking (which a refused).

If they don't reply within the 2 week you set out send the LBA (letter before action).

Ignore their times and dates and delaying tactics!

Good luck!

Thank you Guido for once again pointing me in the right direction!

Some more info and clear up questions

I have a Small Claims Track Hearing in WATFORD on the 24th May.

The case is a block listed at 10am. Anyone else at this hearing?

I used the new strategy for for AQ and therefore now have Special Directions. These would be:

a) A schedule of charges - Not a problem

b) Statements or account info provided under your subject access request - Not a problem

c) A statement of evidence. Using GaryH template (Barclays bank standard 10 point defence), I notice on Peter Rabbit V Barclays thread a mention on about adding a paragraph or two to cover the service charge arguement, as strongly hinted at in paragraph 5. Any help or advise on this available.

d) Cases and statutes, as found in the Basic Court Bundle - Little confused on this as these are not asked for to be attached in support of the statement! Do I need to include the following, Unfair Terms in Consumer Contracts Regulations 1999, the Unfair Contracts (Terms) Act 1977, the common law and Supply of Goods and Services Act 1982.

Or will the quotes in the statement suffice.

regarding other documents needed to support statement!

Does anyone have the Australian Default charges report, Nicole Rich.pdf - Link is not working!

Where can I find the OFT report? The hyperlink no longer works on the Bundle download!

I don't have any Automated charge notification letter/s. The last one I received was torn and trashed with rage over a year ago. Is this a problem?

The notice of hearing also asks for a Witness statement. I am using Karnevils as a guide, any advise?

Many thanks

I agree, £107 pounds is higher than I thought.

What was the total amount of interest charged for being over drawn? Then how was the percentage calculated on the amount being caused by unfair bank charges?

I am claiming £1'700 + £400 in interest (approx. and rising).

I was charged £350 in overdraft interest over the 6 years but not all of this amount was because of unfair bank charges. (probably a very small fraction). It must be difficult/time consuming to dissect what overdraft interest was caused because of unfair bank charges!

i was just wondering as well, are people claiming the overdrawn interest charges as well (not the 8%) in their initial claims?

The banks are allowed to charge a rate of interest on overdraft and another rate for going over your agreed overdraft limit.

I guess you can only really claim the extra interest incurred for going over your agreed overdraft limit because of bank charges.

How you could work this out is probably quite complicated and guessing would not amount to alot

I have heard of people claiming over the 6 years but its certainly not the norm. I'm not sure how the Law stands but I think once the case goes to court the bank will defend any charges over 6 years. Then again the bank have sent you them so why not go for it, you have nothing to loss.

I also received the new T&C. I would not for one minute consider not claiming YOUR money back which Barclays have taken from you UNLAWFULLY.

Go for it, and have nothing to fear is my advise. There's loads of help on this forum. Keep reading other threads and follow the guides and F&Q and you can't go wrong!

Good luck

my thread- http://www.consumeractiongroup.co.uk/forum/barclays-bank/51225-calvsta-barclays-2.html#post635333

Hi Penny

Looks like we're both at the same stage. I received my hearing date 23 May, I have to send paper work by 23 March.

1.) Schedule of charges can be recalculated once (on the day) the bank agree to settle.

2.) I would keep the original statements and send the Bank and Court copies. You will bring the originals to court anyway (if it gets that far)

3.) Yes but you may not need all of it. Also you might want to add extra to help your case, see my thread

http://www.consumeractiongroup.co.uk/forum/barclays-bank/51225-calvsta-barclays-2.html#post635333

4.) Yes it is! We should hopefully be receiving a call from the bank soon.

All the best for now

*News Update*

I have received a court date for my case against Barclays 24 May, and it seems the new strategy has worked. Giving me (the claimant) until the 23rd March to submit my court bundle and Barclays a further 2 weeks to submit theirs (as described in the Draft Order for Directions). Hopefully this should speed things up with a settlement!

Obviously now finalising my court bundle and I am hoping for some advise.

I have printed out the following to use as legal material.

Relevant case law to penalty charges (available on this site).

Should I present all of these cases or just one or two?

Unfair Terms in Consumer Contracts Regulations 1999/01

Unfair Contract Terms Act 1977

Supply of Goods and Services Act 1982

Should I send the whole law document or just the sections that are relevant to my case?

Is there any other articles or information I can present to help my case?

Is it worth printing out recent related newspaper articles and web pages?

Any other help advise is welcome no matter how small or irrelevant you great people think it is!

Thanks for now

I am sorry Scalvey, I have just realised that I was comparing your defence to the Lloyds one.

 

Must stop taking those stupid pills.

 

Anyway my AQ links are still relevant. I am sure someone else will advise you regarding the defence who knows about Barclays.

Hi again

I thought you may have done. Not a problem, it will help others I'm sure!

Do you still think it is essential I send my scedule of charges to the court and to the bank litigation and disputes dept at barclays to support my POC?

I just don't want to confuse things with the claim.

it seems things are proceeding as normal!

Sorry to keep hassling you on this one!

Cheers

Ok here's Barclay's defence. Please excuse some of the type corrections. I scanned using OCR.

1. To the extent it is alleged that the Claimant incurred bank charges on his I account for unauthorised borrowings (whether unpaid fees for returned cheques, "Paid I Referral fees" or any other such fees), the Defendant puts the Claimant to strict I proof of each charge and the date thereof.

2. The Defendant is entitled to charge the Claimant for unauthorised borrowings by reason of its standard terms and conditions. The Claimant accepted the same when the account was opened, including (in particular but without limitation) the 11. following terms and conditions (which are summarised):

a. The Defendant's right to charge a "Paid Referral Fee" where the Defendant pays an I amount (either by compulsion or election) which causes the account to become overdrawn - £30 per item (previously £25) . I

b. The Defendant's right to charge an administrative fee if any cheque, standing i order or direct debit cannot be paid because of insufficient cleared funds in the ! account - £35 per item (previously £30) . i

c. The Defendant's entitlement, if the Claimant becomes overdrawn without an ; overdraft limit, to charge interest at the unauthorised borrowing rate on the excess : balance.

3. The Defendant's standard terms and conditions give the Claimant a fair and transparent view of those terms and the charges applicable for unauthorised borrowings (including where the account is overdrawn without an overdraft limit or where the Claimant exceeds his authorised overdraft limit).

4. If and to the extent it is the Claimant's case that the failure to make necessary payments and / or failure to remain within authorised overdraft limits and / or failure to arrange an authorised overdraft constituted a breach of the terms applying to the account and that the contractual entitlement to debit charges from the Claimant's account constitutes a liquidated damages clause, the same is denied. The charges constitute payments the Claimant agreed to make by reason of the terms and conditions of his account and were consideration for the Defendant advancing credit to the Claimant, which the Defendant was under no obligation to advance: The Defendant was entitled to impose such charges and interest when the Claimant incurred the overdraft.

5. Accordingly, it is denied that the legal principles relating to liquidated damages clauses and penalty charges are relevant or applicable to the facts set out above. Further or alternatively it is denied that any such charges constitute unlawful penalty charges or are in breach of the Unfair Terms in Consumer Contracts Regulations 1999 (particularly but without limitation to, paragraph l(e) of Schedule 2), or are in breach of s.4 of the Unfair (Contracts) Terms Act 1977 (or any other provision), or are unreasonable within the meaning of s.15 of the Supply of Goods and Services Act 1982 (or indeed any other provision)

6. Therefore, it Is denied the charges were unlawfully debited from the account.

7. If and to the extent the Claimant incurred charges on his account, this was caused by the Claimant having gone into overdraft without having agreed with the defendant an authorised overdraft facility or to increase the overdraft facility and / or his failure to make payments to bring the balance of the account into credit.

8. It is averred that the said charges and interest are and remain lawful and enforceable and that the Defendant was entitled to debit the same.

9. The Defendant denies that it is liable to the Claimant for the sums claimed and interest, as pleaded or at all. In the alternative if (which is denied) the said charges are unenforceable and constituted a breach of contract by the Defendant, those charges which were applied to the account prior to 5 January 2001 are not recoverable because they are time-barred under the terms of the Limitation Act 1980 in that more than six years have elapsed since the accrual of the cause of action.

10. In the alternative, and without prejudice to matters stated above, if (which is denied) the said charges and interest or any part thereof are unlawful or unenforceable as alleged by the Claimant or at all, and the charges were a consequence of the breach of contract by the Claimant, the Defendant has nonetheless suffered loss and damageas a consequence of such breach of contract in allowing the account to go into unauthorised overdraft. Accordingly, in the event that the Defendant is unable to rely on its express entitlement to enforce the charges as set out at paragraphs 2 to 3 above, it will seek to recover to the extent necessary such loss and damage as it actually suffered, which will not necessarily be limited to the value of the said charges, and the Defendant seeks to set off such sums against any llability owed hereunder to the Claimant:: Barclays Bank PLC

So there we have it! Please feel freee to advise or ask questions.

10.2.07 - I received my AQ and a copy of the banks defence to my claim.

The banks defence in brief:-

1. They want strict proof of alleged charges. (They have had two copies of highlighted bank statements already. I'm guessing I will need to send again in court bundle).

2. They are entitled to charge as set out in T&C

3. It was clear that I knew of the charges.

4. I should have been more careful with my money.

MY FAVORITES 5. The law doesn't apply to them.

& 6. The charges are fair and lawful.

7. I should have been more careful with my money.

8. The charges are fair and lawful.

9. If the claimant wins they can't be awarded anything past 6 years! (I've only claimed 5).

THIS ONE MADE ME LAUGH THE MOST 10. If charges are found to be unlawful we will counter claim the damage actually suffered, which then could end up being more than the original charge.

Any additional advise on filling out my AQ would be appreciated or any other help, hints or tips would be great.

Cheers for now, keep ya posted!

Thank you for your help so far.

I will send the SOC to the bank and court as advised by GuidoT.

Please put my mind at rest and clear a few things up if anyone can -

Have I made a big mistake by not sending my SOC again to the bank and to the court when claiming through MCOL until now?

The bank filed a defence on the 8/2/06. When can I expect my AQ?

At what point do the courts decide where and when the hearing will take place?

Cheers again

Also sorry... Do I realy need to copy all my statements again (twice) or can I just send the spread sheets with list of dates of each charge + interest?

Cheers