Why is no one claiming the contractual rate of interest???

[jalex_uk]

Due to the lack of Fid duty, element.

 

I don't think its been proven that the Bank doesn't have a Fid. duty anyway, but that's another argument...

[TANZARELLI]

I don't think its been proven that the Bank doesn't have a Fid. duty anyway, but that's another argument...

 

Yes I agree. Also hard to nail to them.

[GowerGal]

Hi Guys!

 

I've been reading all relevant threads etc as advised and I'm now ready to send my LBA to MBNA - however, when I try and open the link for the spreadsheets (England-advanced-works or excel) I just get a page saying unaboe to open page. How can I get this to open please as I NEED the spreadsheet to enter charges and calculate CCI.

Any help would be appreciated.

 

I have already successfully taken on HSBC for Business Account Charges and had full refund (this was before finding this site!) and I did think that I might be able to adapt the original 8% interest for an average for my credit cards ie. where they've charged 15.9, then 16.9 up to 18.9%, could I not take the average and apply to the whole spreadsheet or is that to simplistic?

 

Look forward to your reply

Kay

[Guest bong]

jalex, one problem I think with this is that you don't know how much of their profits were attributable to the penalty charges. Within their net profit there will be losses made in other areas of their business. If you're looking to attack their profits would you not want to recover profits made solely in relation to their penalty charges?

[pattacake]

along with total bank charges,i have a regular monthly interest amount charged me too.is this contractual? if not-can i add this to my total charges and send off with my preliminary letter anyway? hope this question is clear.would appreciate any help to clear this up before i move on.Am stalling big time for fear of making stupid mistakes.

[jalex_uk]

jalex, one problem I think with this is that you don't know how much of their profits were attributable to the penalty charges. Within their net profit there will be losses made in other areas of their business. If you're looking to attack their profits would you not want to recover profits made solely in relation to their penalty charges?

 

It doesn't matter how much of their profits are attributable to penalty charges. What matters is what the bank did with the money they took from you (the penalty charges and the interest on those) - in other words, how much money they made from having your money. Its impossible for the bank to show exactly what they did with your money and where they invested it (the "revenue" they derived from you) because your money just went into a vast ocean of money and added to the bank's collective revenues for the year. So the fairest way of calculating what the Bank might have earned in profit from your money year after year is, surely, to look at the bank's net profit margin (ie. after costs) and use that as the basis for calculating their compounded profits derived from revenue they earned (or, rather, took) from you in the form of the penalty charge and the interest they then charged on that.

 

At least, that's how it seems to me. If there's a better metric to use then I'm all ears and open to suggestions

[Glenn UK]

Account of profits!!!

[hagenuk]

With respect, you're missing the point. You aren't charging them interest, simple or compound. You don't need to compound the interest. You are taking their profits in Restitution. Lets say their profit margin is 30%. In 2001, they took £100 in penalty charges. They made £30 that year from you. Now they have £130. In 2002 they make 30% of 130 = £39. Now they have £169. In 2003 they make 30% of £169 = £50.70. Now they have £219.70.

 

This has the net effect of compounding profits annually. You could, of course, work this out on a quarterly basis rather than annual, as companies report profits (and their profit margin) quarterly, which would have the effect of compounding profits quarterly - obviously more beneficial to us.

 

The point is, WE are not charging INTEREST, simple OR compound. We are asking for restitution of their PROFITS, which are obviously compounded.

 

So the ruling with regard to compound or simple interest is completely irrelevant, as we're not charging interest in the first place.

 

You are seeking an account of profits which is hugely complex and not at all like your seemingly simple explanation above. See for example Esso Petroleum Co Ltd v. Niad Ltd [2001] Ch D and A-G v. Blake [2001] 1 AC 268 where this is explained in more detail before you consider using this argument.

 

In A-G v Blake, an account of profits was described as

 

"An account of profits will be appropriate only in exceptional circumstances. Normally the remedies of damages, specific performance and injunction, coupled with the characterisation of some contractual obligations as fiduciary, will provide an adequate response to a breach of contract. It will be only in exceptional cases, where those remedies are inadequate, that any question of accounting for profits will arise. No fixed rules can be prescribed. The court will have regard to all the circumstances, including the subject matter of the contract, the purpose of the contractual provision which has been breached, the circumstances in which the breach occurred, the consequences of the breach and the circumstances in which relief is being sought. A useful general guide, although not exhaustive, is whether the plaintiff had a legitimate interest in preventing the defendant's profit-making activity and, hence, in depriving him of his profit."

 

If you choose this course of action you are moving away from what is a relatively straightforward breach of contract claim (our breach too, remember) and into an area of law concerning the award of damages, both compensatory and exemplary, which is going to be tricky and could prove very expensive.

 

This is precisely what Tom Brennan is doing with Nat West and that case is due to be heard shortly.

 

Bear in mind also that restitution does not necessarily mean recovery of all gains made by the Defendant. Certain other factors are relevant to the measure of recovery. Where the Defendant made a substantial contribution, to which the Claimant was not entitled, it is conceivable that the Claimant will only recover the value of that which was taken from him or that profits will be apportioned or that the defendant will receive quantum meruit for his contribution (Boardman v Phipps [1967] 2 AC 46 [32].) For example, the bank will have made profit with or without your money and unless you are George Soros, what money you have in the bank will have made little or no difference to their overall profit.

 

If you wish to begin a claim for exemplary damages, then this would appear to be the way to do it - but should you lose, you will lose a great deal more than a few extra pounds in interest. A claim such as this will not be heard on the Small Claims Track, irrespective of the value of the claim.

[Glenn UK]

Hagen

 

Fiduciary duty is not required for acc of profits, urm um, ill go find the case law, shortly its at home right now, Blake Vs Attorney General (edit FFS i see you have already mentioned AG Vs Blake) comes to mind but ill check it out and try to remember to post it.

 

But the rest of your post is about right i think.

 

Edit mind you a thought comes to mind, we often get lost in case law, procedures etc. The purpose of submitting a claim to court is not to win a legal argument generally. It is to force a solution to a problem that two or more parties cannot agree on. If like T.B. the banks decide to settle earlier rather than later and disgorge some of their profits in the favour of the claimant then the course of action has achieved its goals without actually needing to go to court.

 

In essence it is not about how you win, but the winning is everything and the means is irrelevant in some senses. If you can use a mechanism to force them to pay out on your claim early then this is the idela imho.

 

I do accept of course that there are risks associated with such a course of action, costs being the major one.

 

Glenn

 

PS thanks for the case law links some more reading no doubt is called for.

[Pliny the Penuriosus]

jalex the more I think about this the more I think it needs serious consideration. As you state it's straightforward, it's been tested till the cows come home and even the least knowledgeable DJ will understand it

[jalex_uk]

Having though about this some more and discussed it with someone, I now feel the idea of Restitution is even stronger. Rather than using my previously suggested metric of their net profit margin, if we instead use the Bank's reported rate of "Return on Capital" (also sometimes referred to as "Return on Equity," or "Return on Shareholders' Funds") you can with absolute authority state what, in any given year, the bank would have earned on the £100 in charges they took from you. This is the very core of their P&L (Profit/Loss) Account. This metric describes in percentage terms how much return (profit) on any given sum they hold in the way of capital. So you can argue with authority in front of a judge that if Barclays (say) had £100 of your money and their Return on Capital for 2005 was 25% (which it was, I think), then they would have managed to turn the £100 of yours they took into £125.

 

The RoC is calculated after costs and expenses and so takes into account any costs or expenses incurred by the bank in pursuit of achieving this return. So it is a fair and reasonable method of quantifying the Bank's net profits gained from using your money, to which you are entitled.

 

Case closed. No legal references or case examples necessary.

 

Of course, you can also claim statutory interest on top too.

 

Hagen - this isn't a claim for "exemplary damages." It isn't even a claim for damages at all. Its a claim for Restitution of profits gained from Unjust Enrichment and is a simple concept very familiar to the Courts, founded on long-standing principles.

[Pliny the Penuriosus]

Could we perhaps argue CI in the alternative when submitting our POC?

[jalex_uk]

Could we perhaps argue CI in the alternative when submitting our POC?

 

That's going to be my approach. Claim for CI based on the idea of there being an Implied Term in the contract (I know this has been argued about here, but I believe it is strong), which means as they've been using my money without authorisation from me I can charge the same rate they were charging me at for doing the same. In the alternative, I will claim restitution of profits from their unjust enrichment using the approach outlined above.

 

And on top of this I will ask for statutory interest of the usual 8% at the Court's discretion.

 

I've a bank charges claim that's going to come in around £29,000 so I want to get it right.

[Pliny the Penuriosus]

£29K! blimey I'll watch with interest

[hagenuk]

 

Hagen - this isn't a claim for "exemplary damages." It isn't even a claim for damages at all. Its a claim for Restitution of profits gained from Unjust Enrichment and is a simple concept very familiar to the Courts, founded on long-standing principles.

 

While I admire your enthusiasm for making this simple, you need to understand that it is not and that fundamentally, you are going to enter an area of law that will take you right out of the Small Claims Track.

 

Initially you will need to convince the Court that you are entitled to the remedy of an account of profits from what is your breach of contract. In itself, no mean feat.

 

Then you will need to persuade the Court that subsequent to your breach of contract the charges levied constitute unjust enrichment to the bank and that the measure of damages is not only the loss to you, the contract breaching party, but also the gain to the enriched party.

 

How do you propose to do this?

[Glenn UK]

Jeeze guys

 

Pliny and Jalex see if this is close to what you mean

 

http://www.consumeractiongroup.co.uk/forum/abbey-bank/20095-glenn-abbey-21.html#post688937

 

Glenn

[jalex_uk]

you are going to enter an area of law that will take you right out of the Small Claims Track.

 

Initially you will need to convince the Court that you are entitled to the remedy of an account of profits from what is your breach of contract. In itself, no mean feat.

 

Then you will need to persuade the Court that subsequent to your breach of contract the charges levied constitute unjust enrichment to the bank and that the measure of damages is not only the loss to you, the contract breaching party, but also the gain to the enriched party.

 

How do you propose to do this?

 

I'm glad its going to a higher court, because it means the pressure is going to be on the Bank more than me. If they lose, they're on the hook, and precedent will be set. They won't want that.

 

I don't believe convincing the court of the validity of my claim will be hard. The bank charged me penalty charges from 2001 to 2003 amounting to some £5500, and interest on top of that. Interest accrued to the point where mid-2003 I was overdrawn solely due to charges+interest, which left me unable to use my money. I was unable to use the account after that because it became so overdrawn. The cumulative build-up of interest on my overdraft meant that by 2005 I was £9000 overdrawn and facing a Statutory Demand to repay in full, which I did rather than face bankruptcy.

 

I will contend, as have so many others, that the charges are unlawful, punitive in nature, and must be refunded together with any interest they charged. I will contend that the bank systematically set out to enrich itself at my expense by unlawfully taking my money. At this point the Bank will either have to prove they were not punitive in nature - in which case the whole claim collapses and for the first time, ever, a Bank will have successfully challenged a penalty charges claim and won - or concede the point completely in which case precedent will be set for the first time, in court, that these charges are indeed penalty charges.

 

Assuming, for a minute, that they do concede, then they have unquestionably "unjustly enriched" themselves, and will be liable to undertake Restitution on the basis I described.

 

They may offer to settle all the charges+interest charged on a "goodwill" basis without conceding liability, but I am under no obligation to accept if I have a further element to my claim - ie. either a claim for Contractual Interest or Restitution - which I want settled. If they concede the penalty charges prior to court, or in court, and admit liability, then again they are obviously guilty of unjust enrichment - and again precedent will have been set in the matter of penalty charges.

 

Either way, they cannot afford this case to go to court.

 

However, the arguments for Restitution are very strong, providing unjust enrichment can be shown, which it would be if we went to court, because the Bank would have to admit liability if it couldn't prove they weren't penalties, which as we know they can't and won't.

 

I only need to convince the Court of the strength of my claim for CI or Restitution if I win the penalty charge case. And to do that, the Bank would need to let the case get to court in the first place. And if they do that, it will have been after I have demanded full disclosure of their costs with regard to their "fees" (penalty charges) in advance, which obviously they're not going to be able to provide.

 

All in all, I consider the chances of getting into Court as being very remote, but if we get there, then it will be the first time a Bank has allowed this to happen, and I'll end up being the test case - if Tom Brennan hasn't got there first

 

It boils down to this though: these are penalty charges. Penalty charges are unlawful. To prove otherwise, the bank has to disclose its true costs. They won't and can't, so they can't afford to go to court. If they do, they lose on the penalty charges claim. At that point, unjust enrichment is proven beyond doubt and the argument for restitution or contractual interest becomes a simple one.

[jalex_uk]

Jeeze guys

 

Pliny and Jalex see if this is close to what you mean

 

http://www.consumeractiongroup.co.uk/forum/abbey-bank/20095-glenn-abbey-21.html#post688937

 

Glenn

 

Nice

[hagenuk]

What will you do when they pay you the charges, interest at 8% and court costs?

 

It would be very naïve of you to pursue a claim for contractual interest or unjust enrichment in the absence of penalty charges and the bank have done nothing wrong in paying these as a gesture of goodwill and without any admission of liability, they are entitled to do this. You absolutely must keep the penalty charges central to any claim.

 

I am sure you will get your charges, statutory interest and court fees back, but to claim anything else and in particular if the charges have been settled, is going to be anything but simple.

[jalex_uk]

What will you do when they pay you the charges, interest at 8% and court costs?

 

It would be very naïve of you to pursue a claim for contractual interest or unjust enrichment in the absence of penalty charges and the bank have done nothing wrong in paying these as a gesture of goodwill and without any admission of liability, they are entitled to do this. You absolutely must keep the penalty charges central to any claim.

 

I am sure you will get your charges, statutory interest and court fees back, but to claim anything else and in particular if the charges have been settled, is going to be anything but simple.

 

With the greatest of respect, I think you're wrong. There is absolutely nothing wrong with me lodging a claim for unjust enrichment in pursuit of restitution of their unlawful profits. The court would not think it greedy or misguided but simply treat it on its merits. And any offer of payment from them to cover just part of my claim is just a gambit on their part, and puts me under no obligation to accept, particularly as well over half my claim is for interest/resituted profits spanning a 5-6 year period.

 

The point you are missing though, is that in court they would have to show their fees are not penalties as part of the disclosure process. My whole case rests on these being penalties. My demand for CI or Restitution of profits rests on their charges being unlawful. To successfully defend my claim for CI or Restitution, they would have to first prove their charges are not penalties, which we know they cannot do.

 

So how can they go to court to defend my claim for CI if they can't first undermine the point central to my entire claim: that their fees are unlawful penalty charges?

 

Unless they can do this, they won't come to court, because whatever part of my claim they want to defend against, they first have to prove their fees are not penalty charges.

 

Do you think they can do this? Thousands of successful claimants show they can't.

[doo]

jalex uk, I like your posting above, this is the way I see it but capital one have just refused to pay my contractual and without my acceptance have repaid my credit card and sent me a cheque, making my claim £1,000 short. This has somewhat put a fly in the ointment.

[hagenuk]

Do you really imagine that you are the first person to think of this? That this has not been considered, over and over.

 

There is nothing wrong in you making a claim for anything you wish, but you need to understand that in these claims, as with most cases, the burden of proving any given claim rests with you, the claimant. He who asserts must prove.

 

Thank goodness you came along when you did though - how stupid do we all feel now having done it so wrong all this time?

[sasmalec]

I am starting my claim again because I haven't claimed for contractula interest. I have put all the details into the Google spreadsheet with interest not compund and am getting strange figures, for a £30 charge back in 2002 it is showing interest at £257.73. Is this correct, it increases the claim enormously!! Help

[jalex_uk]

Do you really imagine that you are the first person to think of this? That this has not been considered, over and over.

 

There is nothing wrong in you making a claim for anything you wish, but you need to understand that in these claims, as with most cases, the burden of proving any given claim rests with you, the claimant. He who asserts must prove.

 

Thank goodness you came along when you did though - how stupid do we all feel now having done it so wrong all this time?

 

Your arrogance is kinda breathtaking, along with your immediate nay-saying. I'm sorry I began discussing the idea here, as you obviously know best. The barrister I'm working with to develop this strategy begs to disagree with you too, but I doubt his professional opinion matters much to you.

[jalex_uk]

jalex uk, I like your posting above, this is the way I see it but capital one have just refused to pay my contractual and without my acceptance have repaid my credit card and sent me a cheque, making my claim £1,000 short. This has somewhat put a fly in the ointment.

My strategy will work best with bank accounts, not credit cards...and only where the bank can't literally force you to accept their payment by depositing it into your card, or against your existing debt (card balance) with them. I don't have an account with the bank I am pursuing anymore, so its hard for them to say "hey we've paid you, the money's in your account."