Court hearing next week- help needed please

[rosa28]

Hi

 

My sister has been given a court date next week 22 Aug.

 

SCM have today sent through their skeleton argument. It's approx 4 pages long and basically it's to request a stay due to the OFT test case.

 

I'm somewhat out of touch regarding the charges since the test case began, so is my sister lol........it's been so long.

 

What does she need to do at this stage? This has all happened in the last 2 days and she'd almost forgotten about it.

[GuidoT]

It is very likely the matter will be stayed, I am very surprised that the court has not automatically stayed the matter.

 

Is there anything unusual about the case?

 

Can you post up (verbatim) the wording of the court order that states a hearing date of the 22 August.

[rosa28]

Hi guidot

Thanks for your reply.

 

Other than it was originally a hardship claim due to her income being childrens disability, there is/was nothing unusual about the case. She has since changed her bank as they continuously took charges from benefits.

 

The order just states that there will be a 30 minute hearing on 22nd Aug for her case to be heard.

 

SCM sent through 4 page skeleton arguement which just looks like they are requesting a stay.

 

Thanks for your help.

[GuidoT]

Can you please post up the actual order wording please, I need to determine if this is an allocation or main hearing.

 

Which court?

 

It is very unusual for matters to get to hearing given the test case, but one of the reasons is due to hardship.

[rosa28]

Hi guidot

 

I do not have the order, my sister will bring it this evening so I will post up then. meantime, I am posting their skeleton arg.

 

before changing banks, my Sister wrote to the court and SCM/Lloyds stating her case as the smallest child was recovering from heart surgery (2 yrs old) This was in November 2007.

 

She has also since written and explained that she has changed banks so we understood the hardship claim no longer exists (January 2008)

 

On receiving the hearing date she called the court and they said her case would be heard on 22nd. This is Birmingham County Court. The hearing is 30 minutes.

 

 

[GuidoT]

Can you post your particulars of claim up or link to them if in the library here. Advise me when you filed the claim and that should give me an indication of the type of hearing.

 

Have you filed an allocation questionnaire?

 

Birmingham is not a good court for us, DJ Cooke and the Berwick matter. What is the name of the judge on order.

 

Is the court aware of the hardship circumstances.

 

If this is the main hearing, then there is a lot of work to do, we need to prepare a bundle.

[rosa28]

Hi

 

Claim started 23rd July 2007 (prelim request)

AQ returned 12th October 2007 including draft order for directions as per this site.

Letter declaring hardship claim to SCM 26th November 2007

 

I will post all copies of these and the order when I receive them tonight.

 

I understand that although she no longer banks with Lloyds, they refuse to let her close the account and they continue to take out the monies for a loan she has with them. She has no money going through the account but lots more monthly charges.

 

She no longer has access to a computer, hence my involvement now and I'm working in the dark as it were so your help/guidance is greatly appreciated.

 

thanks

[rosa28]

O-K, I have now got a little more info. This looks like an application hearing.

 

The order states:

 

Take Notice that the hearing of the Claimants application will take place at

Birmingham County Court on Friday 22nd August. 30 minutes has been allowed.

Attached to the order is a copy of the amended POC that had been submitted under the hardship. As follows:

 

26th November 2007

Lloyds TSB Bank plc

25 Gresham Street

London

EC2V 7HN

 

In the Birmingham County Court

Claim Number xxxxxxxxxx

Dear Sir/Madam

RE: HARDSHIP AND BENEFITS CLAIM

I am hoping this letter will reach someone who will actually read the contents and respond accordingly. This is a plea to Lloyds TSB Bank who has promised to abide by the banking code and filter genuine hardship claims.

You are by now aware of my intentions to reclaim bank charges made on the above account over the period of the last 6 years. I am disappointed to say the least that all previous attempts on my behalf to settle this matter in a civil manner were ignored by you.

I feel this has been very poorly handled on your behalf and that I was left little choice but to take my claim for these charges through the court legal system.

I am in receipt of income support and Child Tax Credits, along with Child Benefit, which were paid directly into this account. The categories of benefits that I receive are deemed inalienable under the Social Security Administration Act (1992) and Tax Credits Act 2002 (s.45). My argument is that penalty charges by the bank amount to an unlawful charge under Section 187 of the SSA 1992, yet despite this fact the bank has taken benefit money from my account (as penalty charges) and I seek to recover these charges through the current claim. To hold this claim until the outcome of the pending test case will cause my family (2 yr old boy with severe heart problems) and me considerable hardship. My land line telephone has been disconnected, and I’m sure you will appreciate this is my life line.

I would also like to take this opportunity to inform you that on the advice received from the Court, I shall be submitting an N244 to the court to reinstate my claim due to hardship for what I can only describe as a serious breach of conduct on the part of Lloyds TSB Bank. The only funds to enter my account have been paid in by Income Support, Tax Credits/Child benefit, and carers allowance paid in respect of my2 yr old Son with heart problems. It has been brought to my attention that these funds are deemed to be exempt from any bank penalty charges under the Tax credit Act 2002. Please see below:

 

The relevant section from the Tax Credits Act 2002.

 

45 Inalienability

(1) Every assignment of or charge on a tax credit, and every agreement to assign or charge a tax credit, is void; and, on the bankruptcy of a person entitled to a tax credit, the entitlement to the tax credit does not pass to any trustee or other person acting on behalf of his creditors.

(2) In the application of subsection (1) to Scotland-

(a) the reference to assignment is to assignation ("assign" being construed accordingly), and

(b) the reference to the bankruptcy of a person is to the sequestration of his estate or the appointment on his estate of a judicial factor under section 41 of the Solicitors (Scotland) Act 1980 (c. 46).

 

You will see from my previous banking with you, charges were taken from these funds and on occasion leaving me with no funds available to provide even basic living for my family. After discussing the matter at branch level, it was decided that my only course of action now would be to increase my borrowing (even though the operative was well aware of the fact that monies being taken from the account were Benefits) although I have accepted and agreed to these increases, I feel I was given little other choice.

I have no personal complaint against the operative, he was polite and courteous and I did genuinely believe at the time that he was recommending what he believed to be a reasonable course of action. Although I can't help feeling that I have been led into an agreement that under normal circumstances I would not have agreed to accept.

 

 

Further charges are being debited from the account that I had not previously included. I shall of course submit Form N244 to the court to amend the total amount of my claim.

I trust I shall not receive any difficulties from you in amending this claim given the reason for the amendment.

I have attached a new detailed and true copy of my schedule of charges for your records.

 

 

However, in the interest of saving Lloyds TSB Bank any further embarrassment by continuing this claim I am prepared to wait a further 48 hours before submitting the N244 form to the court. With this in mind I am prepared to extend an olive branch one final time and would be prepared to accept an offer from Lloyds TSB Bank for the amount of £1,580.00.

 

 

I fully believe that my difficulties meet any definition or criteria of hardship.

 

Many thanks for agreeing to examine matters. I look forward to your reply.

 

 

 

 

As mentioned in an earlier post, the Court is already aware that my Sister had changed banks so that the hardship claim is no longer in effect, so can't understand why this hearing is taking place.

[GuidoT]

Was the N244 formally submitted?

If yes what did it say exactly, did it include the Lloyds letter above?

[rosa28]

Thank you for your time guidot,

 

Having to get answers from my Sister over the phone so hope the following is clear,

 

The n244 stated the intention to

 

1. apply for an order to have the original claim reinstated

2. an amendment to the particulars of claim

 

because

 

1. original exemption form had been mislaid/not received by the court

2. claimant is now fully aware that the basis of the original claim was not fully stated in relation to benefits.

 

The letter in the previous post was sent to Lloyds and SCM just prior to sending in the n244 in November.

 

The amended POC is as follows:

 

 

1. The Claimant has an Account Number xxxxxxxx Bank Sort Code xxxxx ("the Account") with the Defendant.

 

2. During the period in which the Account has been operating the Defendant has automatically debited numerous charges to the Account in respect of referred Direct Debits and the Claimant exceeding his overdraft limit (“the Charges”). The Claimant understands that the Defendant contends that the charges were debited in accordance with the terms of the contract between itself and the Claimant (“the Agreement”).

 

3. A list of the charges (“the Schedule”) applied is attached to these Particulars of Claim.

 

4. The Claimant’s entire income is derived from Income Support, Carers Allowance, and Disability Benefit paid in respect of the Claimants 2 year old Son who suffers with heart problems. The Benefits are all paid directly into the Account. This money does not belong to the Claimant but is public money to meet the basic needs of the Claimant and the Claimant’s family.

 

5. The Claimant contends that the clauses in the Agreement that the Defendant uses to justify the Charges constitute an assignment of money by the Defendant and to the Defendant contrary to

 

a) s187 Social Security Administration Act 1992 regarding Income Support and Child Benefit,

 

b) s45 of the Tax Credits Act 2002 regarding Child Tax Credit, and are void. The Charges are therefore unlawful.

 

6. The defendant has, in addition, levied interest on these charges which is also detailed in the Schedule.

 

 

7. It is the claimant’s contention that the defendants charges are a disproportionate penalty , do not reflect a true representation of actual loss and therefore are unenforceable in common law and statute.

 

8. The claimant quotes the following Common law Principles (Penalty charges are irrecoverable at common law).

The precedents for this were:

a) Dunlop Pneumatic v New Garage [1915] AC 79. Lord Dunedin set out some tests that are considered even in modern cases when the court is asked to rule on penalty charges. They are;

1) If it is "extravagant and unconscionable" i.e. that the cost incurred by the business because of the breach is lower than what the consumer is being expected to pay because of the breach.

2) It is also a penalty where the consumer is to pay a larger sum due to failure to pay a smaller sum. It was held that a contractual party can only recover damages for an actual loss or liquidated losses.

b) Murray v. Leisure play [2005] EWCA Civ 963 “English contract law recognises that, if the parties agree that a party in breach of contract shall pay an unjustifiable amount in the event of a breach of contract, their agreement is to that extent unenforceable”

c) CMC Group Plc And Others V Zhang [2006] EWCA Civ 408. “'Whether a provision is to be treated as a penalty as a matter of construction to be resolved by asking whether at the time that the contract was entered into the predominant contractual function of the provision was to deter a party from breaking the contract or to compensate the innocent party for breach. That the contractual function is deterrent rather than compensatory can be deduced by comparing the amount that would be payable on breach with the loss that might be sustained if breach occurred.”

 

9. Furthermore , or in the alternative , penalty charges are also contrary to: The Unfair Terms in Consumer Contracts Regulation 1999 No 2083 SCHEDULE 2 Indicative and Non-Exhaustive List of terms which may be regarded as unfair (e) Requiring any consumer who fails to fulfil his obligation to pay a dis-proportionately high sum in compensation .Further , or in the alternative , if the defendant states that there was no breach of contract and that the charges are for a service, then it is the Claimants belief that the defendants have attempted to restructure accounts in order to present events of default spuriously as additional services. However The Unfair Terms in Consumer Contracts Regulations 1999, are concerned with the intention and effects of terms, not just their mechanism. 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.

 

10. Accordingly the Claimant claims:

 

a) the return of £xxxxx taken by the defendant in charges detailed in the Schedule.

b) interest under section 69 County Courts Act 1984 at a daily rate of 0.36p (8% per year) up to the date of judgement or earlier payment.

 

11. The Claimant also respectfully asks the court to make an order requiring the Defendant to cease taking public money paid in benefits to the Claimant from the Claimant’s account.

 

I believe that the contents of these particulars of claim are true

[GuidoT]

Here is an example of where a stay was lifted due to hardship, the first I have seen.