Clydesdale's detailed defence...

[Robertxc]

For anyone out there wondering that Clydesdale's defence is going to look like...

1. Admitted the parties are as designed in the instance. Admitted they have a place of business within this Sheriffdom. Admitted the Pursuer is a consumer within the meaning of paragraph 3 to schedule 8 of the Civil Jurisdiction and Judgments Act 1982 as amended. Admitted the Pursuer is domiciled within the Sheriffdom of Fife. Admitted this court accordingly has jurisdiction. To the knowledge of the Defender there are no proceedings pending before any other court involving the present cause of action between the parties hereto. To the knowledge of the Defender there is no agreement between the parties prorogating jurisdiction of the present cause to another court. Quoad ultra denied except insofar as coinciding herewith.

 

2. Admitted the Pursuer has a current account with the Defender under explanation that it is a joint account with Mrs Robertxc. Quoad ultra denied. Explained and averred that at all material times the contractual relationship between the pursuer and Mrs Robertxc ("the Customers") and the Defender was governed by the Defender's standard terms and conditions for current account customers from time to time in force. The terms and conditions have been amended from time to time, however at all material times these terms and conditions provided that:

(1) the Customers must obtain the Defender's agreement before overdrawing on the Account;

 

(2) If the Defender made payments from the Account or paid cheques which were guaranteed by the associated cheque guarantee card when there were insufficient funds available, any overdraft created or any overdraft which exceeded an agreed overdraft limit would be unauthorised;

 

(3) If the Customers drew cheques or authorised or made payments without sufficient money available in the Account, taking account of any overdraft Limit and allowing for uncleared cheques, the Defender might return the payments and make a charge for doing so;

 

(4) charges and interest applicable to the Account were published in the form of tariffs and up-to-date tariffs were available in branches;

 

(5) where appropriate, written details of overdraft charges and debit interest incurred on the Account during the previous charging period (i.e., the previous month) would be sent to the Customers at least 14 days before the charges and interest were deducted from the Account;

 

(6) If the Account had an unauthorised overdraft, additional charges might be levied which would be debited to the Account on the day on which the unauthorized overdraft was created;

 

(7) If the Defender increased a charge for a basic account service, the Defender would give the Customers at least 30 days' notice. At all material times the Defender's tariffs of charges for current account customers set out the charges from time to time applicable pursuant to its standard terms and conditions in respect of:

(1 ) unauthorised overdraft daily fees;

 

(2) unauthorised overdraft monthly fees;

 

(3) unpaid cheque or direct debit charges;

 

(4) card abuse fees (payable where a cheque or debit card is used to guarantee a transaction and payment would have been refused but for the guarantee).

3. Denied.

 

4. Denied. Castaneda and Others v. Clydebank Engineering and Shipbuilding Co. Ltd (1904) 12 SLT 498 is referred to for its terms, beyond which no admission is made. Quoad ultra denied except insofar as coinciding herewith.

 

5. Denied that the Defender's charges represent an unfair penalty charge in terms of theUnfair Terms in Consumer Contract Regulations 1999, 5.1. 1999 No 2083 ("the UTCC"). Explained and averred Paragraph 1 (e) of the Schedule 2 of the UTCC provides that "a term requiring any consumer who fails to fulfil his obligation to pay a disproportionately high sum in compensation may be regarded as unfair." The Charges are not compensation, but rather a fee for the service provided by the Defender in extending facilities to the Customers, all as envisaged by the agreement in place between the Defender and the Customers. Further and without prejudice to the generality of the foregoing:

(1 ) the terms and conditions were fair having regard to the following matters:

(a) the cost to the Defender of maintaining administrative systems relating to unauthorised overdrafts, unpaid cheques and direct debits and abuse of cheque and debit cards for the purpose of keeping the level of overdrawing under review and controlled as far as possible;

 

(b) the increased risk of Loss to the Defender arising from such unauthorised transactions and the associated cost of enforcement and recovery systems;

 

© the need to operate standard procedures and to set standard charges in order to avoid the substantial costs of individual assessment in relation to each particular case;

(2) the terms and conditions complied with all relevant requirements of the Banking Code as the Banking Code was in force from time to time. Quoad ultra denied except insofar as coinciding herewith.

6. Denied.

 

7. Denied.

[hoogie32]

thanks mate

[diddled]

Looks like they may have shot themselves in the foot with their Defence.

This outfit's antics can only be likened to those of a circus

[SR7133]

What will be your arguement against their defence? I have Preliminary Hearing on Monday and am likely to receive the same defence with a full Hearing probably next month and it would be useful to have a consistent approach.

[Robertxc]

The argument against this basically comes in two parts. They talk about the charges being a 'fee for the service', but in reality they're applied 'in terrorem', which makes them penalties. They also talk about how the charge includes costs for all sorts of other stuff, including 'administrative systems', and 'the increased risk of Loss to the Defender arising from such unauthorised transactions'. This means that they average out the costs, which is one of the key tests as to whether or not a charge is a penalty, and also, they seem to be saying that if you bounce a cheque or a DD they're going to bill you a proportion of somebody elses default too! The laws on penalty charges are long established, and are a fully settled part of the law. If you bounce a cheque, they are allowed to charge you the actual cost to them of that bounced cheque. No more.

 

We'll be posting more about this defence in time, but suffice it to say that we don't consider it to be particularly strong.