RedDeath v LloydsTSB

[GaryH]

Good luck reddeath!

 

In the meantime it is my understandment that a scottish small claims court would only go up to £750. So now thinking of claiming in england, but even then the figure is 5k. I feel more than one claim coming on. Also as its an english court i can claim 6 years back. Hopefully this will settle out of court so i won't have to make my journey south.

 

You should'nt just split up a claim just so as to keep under the small claims threshold - it is considered abusive and the bank would more than likely apply to get them amalgamated anyway. 1 contract (account) = 1 claim.

 

Although the fast track contains a very, very small costs risk, its nothing to fear. In fact it does have distinct advantages - such as the availibility of standard disclosure.

[GaryH]

I'm not 100% sure on Scottish proceedure or how it differs from that of the English system. There is a 'Scotland' forum within 'General' if you need some advice specific to Scottish proceedure.

[GaryH]

The interest rates going back at least 4 years should be published on the LTSB web site.

 

By all means go for contractual, but be sure you fully understand the issues first. Also, be prepared for a scrap - they don't pay it without a fight.

[GaryH]

Its a very good letter - however, I can pretty much guarantee that they won't read it properly, and even if they do they will not respond. I suppose it will demonstrate to the court that you have given them every opportunity to settle and have tried your best to avoid litigation - which is good - but unfortunately that is the only beneficial effect it will have.

 

Also, I would not personally advise that you take a contractual interest claim into the fast track with costs exposure. Its undeniably risky. However, I trust you are fully aware of the risks and have already carefully considered them.

[GaryH]

I was'nt going to get involved in the CI debate again, but there are some issues here which I find quite disturbing so I'm going put my 2p's worth in.

 

I understand that I am liable to cover their costs, should I lose. However the amount of money that I stand to win would literally change my life. I would be able to clear all of my debts, re-establish my credit rating (i am disputing some defaults as I type) but most importantly it would also give me the money to put down a deposit on a house. What I stand to win is the chance of a better life, with no more sub-prime credit lenders and so on, and for it I am willing to fight to the death. However, you are very right in saying that I need to consider the possibility of the case being struck out, and for it all I can do is read as much as i can and put forward the best particulars of claim that I could possibly come up with. Regardless of other people's advice, it is my money on the line.

 

Assuming that I do all of my research and fill out my claim properly, then it is fair to say that the bank will not disclose their true costs with regards to the charges. So claiming those back is a relatively straight forward process.

 

Now I agreed with my bank in my contract/terms and conditions that I would cover their costs incurred by any bad money management on my behalf. However, at no point did I agree that they could charge me more for it, as that would have been unlawful. In claiming the charges, the banks have abused their position as my fiduciary as they took more money from me than I ever allowed for them to take. Let's not forget that the bank is in a very priviledged position and can take money out of people's accounts as they please (as honory's situation in the LTSB thread clearly exemplifies).

 

There is a principle of mutuality in the agreement so what is fair for them should also be fair for me. Now the banks have given me the tools to go over my authorised credit limit (cheque guarantee cards and so on), and when i did go over those limits they charged me 29.8% interest as I had not agreed to borrow money from them. So far so good.

 

Now, in the instances that the banks took money from me through the charges they were guilty of the same process that I was when I went over my overdraft limit. They charged me 29.8& on that debt and as such it is only fair that I can charge them just as much for it.

 

So why not? Ok, sorry if this is sounding like a rant, it is not meant that way, I am trying to convince myself while at the same time raising some issues.

 

They could argue that a contract does not exist, merely terms and conditions, but then my counter arguement is why include a signature space on the documents? In all effect the terms and conditions are the contract.

 

If I plead my case properly and explain about reciprocity and mutuality then on what grounds could it be struck out? What is it about my claim that is so wrong?

 

My arguement is simple. Prove that those charges are a legittimate estimate of your costs, if not then pay me back my money, and the interest on it, not just at statuatory rate but at the same rate that I have paid them for the same unauthorised borrowing.

 

As for damages, yes this is a very tricky situation and one that I am considering carefully. I appreciate I am treading water with the compound interest rate so this may not be the viable as it may alienate the courts and deminish what I think is a well constructed case.

 

I do feel however that I have a case for damages. If you look at the fact that some months those charges amounted to 30% of my wages, then it has forced me to borrow money from sub-prime lenders as if they had behaved lawfully throught out, then I would only have paid the true cost of those charges, it would have left me with more money and I would not have had to resort to sub-prime lenders. Could I possibly claim back charges and then should I win, claim back damages at a different date or rather the claim would be deemed as settled and that would be it?

 

Lastly, stauatory interest. Is this an interest based on an oustanding debt with them. I.e they owe me 12k so far (assuming contractual interest), would I not be asking for interest on the debt? I'll research this fully however it is not at the top of my priority list, but if it meant i had a chance then well, why not?

 

Ok, I feel better now that i got all that off my chest. I really do wish I had a crystal ball to see what I should do.

 

Any comments by anyone I would be really grateful, as I will consider every option there is in order to create a better case.

 

Thanks again to all those who offer advice.

 

Firstly, I can fully understand that you're passionate that you should be entitled to more than just the recovery of the charges for what the bank have done to you, and the consequences - probably not only financially, but also on your life in general - of their unlawful actions.

 

Unfortunately, such emotional issues do not come into it in a court. The judge is interested only in the law - and how that law applies to the facts of your case.

 

Now I've heard alot said about contractual mutuality, but unfortunately I've yet to see ANYONE substantiate the talk with any sort of basis in law whatsoever.

There is a principle of mutuality in the agreement so what is fair for them should also be fair for me.

Perhaps it does seem fair - in fact, yes, it does I agree. Unfortunately though, unless there is a legal basis its totally irrelevant. That quote you've pasted from another thread is actually a perfect example of this - the poster of that comment strongly argued that "case law establishing contractual mutuality is clear....blah, blah, blah" but in the next post I asked for a link or reference to the case being refered to - and surprise, surprise it all went deathly quiet!

 

In fact, while we're on the subject of case law, have a research of this case - Westdeutsche v Islington BC [1996] A.C. 669, [1996] 2 All E.R. 961. This is a clear House of Lords authority against the awarding of compounded interest upon the basis of unjust enrichment.

 

So all this begs the question - upon what basis are you claiming contractual interest? What authorities or legislation will you rely on in court to substantiate it? Upon what do you base your assersion that contractual reciprocity exists in the context you profess that it does? I know there are some excellent arguements for it, and you seem very well versed in them, but when your in the multi track up against professional solicitors your going to need a hell of a lot more than that I'm afraid.

 

I'm sure I'll get shot down for this, but frankly I don't care - untill somebody shows me some case law or other such basis in law for contractual mutuality or CI in general, I'll make no apologies whatsoever.

 

Something else I should say, is don't think for a minute that you'll be able to chuck whatever you like on top of your claim and sneak it in on the back of the fact that they won't defend the charges so they'll pay everything else as well - its not going to happen. They'll more than likely pay the charges + 8% + costs then apply for summary judgement on the grounds that there is no basis for your claim to continue.

 

I think your taking far too much on without giving proper thought to the consequences. Charges + pre 6 year charges + CI + "damages" + default removal is putting you straight into the multi track almost without doubt, and I'm sure I don't need to tell you the consequenses if you were to lose in the Multi-track. It would certainly change your life alright - it could quite easily mean financial ruin. Adding 8% stat on top of everything else is just plain foolish. Its duplicated benefit - I.e. unjust enrichment, and the court would not tolerate it for one minute.

 

Sorry if this seems harsh, but it seems to me that your attitute is somewhat Blasé - particularly given your comment on Honory's thread earlier on.

 

IMHO if you want to pursue more than the charges + stat, choose one or the other - CI or consequential losses. Even then I would strongly advise against a CI claim in anything other than the small claims track. Consequential losses, with the right advise and a great deal of research might be viable, but you would have to directly and unequivically quantify how their unlawful charges caused you direct loss.

[GaryH]

One other thing, have you considered going down the Financial Ombudsman route for consequential loss, and/or distress and inconveniance? It certainly might be worth looking into. Its a damnsight less risky anyway.

[GaryH]

I will research this thoroughly, and I have to admit that I am no longer so confident in pursuing this. Could I pursue interest at the authorised borrowing rate (as per Mindzi and Lucid) or scrap it all together and simply go for statutory?

As I said, personally I would not claim contractual interest unless I was confidant the claim would be heard in the small claims track - and I would not advise anyone else to either.

 

The more I reseach CI the more I doubt its validity. IMHO mutuality and reciprocity is in legal terms a non-starter, unjust enrichment is perfectly logical, but unfortunately there's the small matter of a House of Lords precident against! There are other arguements such as fairness and balance, and disgorgement, etc - all great arguements, but also all untested arguements. It would be a good experimental project - but IMO the fast or multi-track aren't the places to experiment!

 

Of course, ultimately its your claim and your risk - nobody can tell you what to do. I'm just trying to get you to see the dangers.

Westdeutsche v Islington BC [1996] A.C. 669, [1996] 2 All E.R. 961

Westdeutsche v Islington BC

 

 

Is there a fiduciary relationship between a consumer and their bank?

Now there's a question!! You could argue one, sure, but I'm not sure you could prove one.

[GaryH]

Just another thought or two...

 

Undue enrichment seems fair to me and can be argued.

Mutuality seems a non-starter? Why?

But what does contractual mutuality mean? Does it mean that every term in every contract is subject to an implied reciprical term? I'm not a lawyer, but I very much doubt it - and even if it did nobody has ever shown me anything to suggest that this principle is established in either common law or statute.

 

My understanding is that the meaning of mutuality of contract only identifies the rule that where one party fails to fulfill to a contractual obligation, the other party need not fulfill their correlative obligation either.

[GaryH]

Thanks caro, i appreciate the help and the humour. I think mutuality does form the basis of any agreement but I will research even more.

 

It really does come down to what is fair for them, is fair for us. Consesus ad idem. Both parties have the same rights.

 

Hence if they can charge 30% for something, then so can I.

 

Maybe it seems over-simplified, but it is a simplified matter.

 

It seems to me that if they can charge 30% interest on unauthorised borrowing then they should also pay the same rate for it if the tables are turned. The charges amount to unauthorised borrowing, thus...

Again, I'd go back to what I posted in #80.

 

I find it inconceivable that contractual mutuality could mean that each term in each contract carries an implied reciprical term. Its not enough IMO.

 

The bank has a consumer credit licence, overheads and costs, risks, etc, etc. Its providing you a service by providing you with an overdraft from which you may borrow its money. You pay for that service by way of interest on borrowings from it - this forms the fundemental core of its very business. The bank provides you with cards, pin numbers, internet banking, etc and there are all sorts of other costs which are associated with providing your overdraft and borrowing facilities. None which justifies the extortionate Un/A rate, granted, but thats not the point - you signed the contract, theres an express term allowing them to charge it which you agreed to.

 

Them having unlawfully taken our money, IMO, cannot in any way be considered as comparable to them having an overdraft with us.

 

Again, as far as I'm concerned the mutuality arguement just isn't valid. Just my opinion though obviously - I'm not a lawyer!

I joined this forum in December, i think I used to have a social life back then but not anymore. I now find it very hard to communicate with people without the use of a keyboard and smiley faces.

Tell me about it!

[GaryH]

I am going to unsubscribe from this thread now as I don't feel I'm able to contribute any further. What you are proposing is not only frought with danger, but more importantly its way beyond the realms of this sites capabilities. We are here to help people reclaim bank charges, and cannot condone members taking on complex and ill-conceived actions such as this.

 

If this is a course of action which you are intent on taking, then I would strongly advise that you seek professional legal advice first.