RedDeath v LloydsTSB

[RedDeath]

Just another thought or two...

 

Undue enrichment seems fair to me and can be argued.

Mutuality seems a non-starter? Why?

 

The idea of freedom of contract is central to enforcements of contracts and it runs through many of the individual rules of contract law:

• An agreement (offer and acceptance) is said not to exist unless there is consensus ad idem, the so called mutuality of the parties. So even so the parties think that they have agreed on something, there will be no enforceable contract between them unless this mutuality can be shown. The law prevents one party from forcing goods and services on another party without an actual agreement to take them. This is apparent in common law rules on acceptance as well as in statutes such as the Unsolicited Goods and Services Act 1971.

 

I could argue consensus ad absurdum on this on as well. If there is no mutuality in the agreement, then by its own nature there would be no contract as for a contract to be perfectly formed there needs to be mutuality between parties. Without mutuality, there is no law. Hence mutuality must exist.

[caro]

I think the scare got the point across that losing such a case could have a life changing effect for you too. The ERC issue was experimental and Maroonfox and others who also lost and were landed with costs were very well prepared.

 

I've contributed a fair bit to CI discussions in the past and look forward to someone finding something new to convince me. I was tempted at one stage to go for it, but didn't have the nerve or the money to risk it. I really don't think I can add more.

 

I know a few people still agree with it, but I'm not aware of many, if any, mods or site helpers who would suggest you claim it now. Even those who used to advise to go for it have changed their views now, although mcuth has a claim outstanding

 

Anyway all points now made so good luck.

[caro]

Just remembered mcuth has a CI claim going which the bank have applied to have struck out, although may not be on the grounds of CI. Hearing is due in April.

 

Have a read as mcuth is very thorough. http://www.consumeractiongroup.co.uk/forum/royal-bank-scotland/10582-mcuth-rbos.html

[RedDeath]

Cheers Caro!

 

If it is about passion, then I have already won...but as Gary pointed out there is no place for emotion in court. I guess all I can do is research it even more, but as it stands I feel I have a chance for it. What I don't have is the money should I lose.

 

Thanks again mate, I'll keep my eyes out for MCCuth.

[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.

[RedDeath]

The notes I have on mutuality seem to imply that for a contract to exist there needs to be an element of mutuality. I think that rather than it being set in stone, i.e. when setting up a contract you will use section x paragraph y, it is more of a law "theory". Maybe theory is the wrong word, but maybe ethos? Something down the lines of for us to live we need air, for a contract to exist there needs to be mutuality. I get the feeling it is something you learn in law class 101.

 

Here are some notes...

 

As the law of contract has developed, however, it has been recognised that the parties to a contract cannot be given unlimited freedom and the law has in many instances intervened to give greater protection to the parties. There are a number of reasons for this:

• It is recognised that very often the parties are of unequal bargaining strength and therefore one party would be able to dictate the terms of the contract, possibly at the expense of the weaker party.
  
• Particularly since the middle of the twentieth century, judges, Parliament and, more recently, the European Union have all concerned to give greater protection to consumers to avoid them being taken advantage of by unscrupulous businessmen in contracts that are driven more by the profit motive of businesses rather than the individual needs of consumers.
  
• It would be unfair to allow one party to take advantage of the other party’s mistake or to take advantage of a falsehood, or to coerce one party to enter the contract against his will.
  
• In certain instances either the courts or Parliament have recognised that it is unacceptable or inadvisable for parties to enter specific types of contract.

• In the case of exclusion causes the Unfair Terms in Consumer Contracts Regulations 1999, first introduced as the Unfair Terms in Consumer Contracts Regulations 1994, regulate consumer contracts to prevent unfair advantage being taken of the consumer. The effect of the regulations is that the party dealing with the consumer cannot insert advantageous terms into contracts where there is no comparable term in favour of the consumer. The regulations implemented EU Directive 93/13, The Unfair Terms In Consumer Contracts Directive.

A contract is perfectly formed:

· A mutual agreement

· Supported by consideration by both parties

· With an intention to create legal relations.

 

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...

[mcuth]

Just remembered mcuth has a CI claim going which the bank have applied to have struck out, although may not be on the grounds of CI. Hearing is due in April.

 

Just FYI, Cobbetts' application to strike is brought on the basis of the Limitations Act (99% of all my charges are from 1999/2000 - all 6+years before the claim date) meaning that in their opinion there isn't "a legally recognisable claim to be made" - absolutely nothing to do with CI as yet

 

Cheers

 

Michael

[caro]

A contract does not have to be mutual. The_Phoenix wrote to HSBC with amendments to his T&C's so that he could charge them. He gave them 28 days to object to the amendment which they failed to do, so he started invoicing them, which is when they sat up and took notice. The effect of his amendment was to make the T&C's mutual with respect to charging, and HSBC were ordered to pay the invoices I believe, but my point is that T&C's are not mutual, so more reason I'm unconvinced by the mutuality argument.

[RedDeath]

Ha ha!!!

I think once this is all over i will be writing to Lloyds TSB giving them 28 days before I enforce my own terms and conditions. Just too tired to think of anything witty, but I will....

 

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.

 

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.

[lucid]

Gary, thanks a million for your points. Yes, I agree, there is no room in a court for emotion.

 

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?

 

Hi RD,

 

This is a few posts too late and may not be relevant now, but for the record we claimed for contractual interest at the unauthorised borrowing rate. But.... our oldest charges were about a maximum of 3 years old so the effects of compound interest weren't anywhere near as massive as they can be. It's very likely that our interest earnt on each claim was actually a lot less than other people's claims for statutory (8%) interest. So looking at it from that point of view, it probably wasn't enough to make the bank pay attention.

 

Spend as much time as you need to researching your claim and don't feel you have to get it filed as soon as you next 14 day deadline expires.

 

Good luck. Lucid

[caro]

Hi RD,

Spend as much time as you need to researching your claim and don't feel you have to get it filed as soon as you next 14 day deadline expires.

Excellent advice. You set the timetable and you can change it if you want to. The bank can't change it just because you can. It isn't mutual.

[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!

[RedDeath]

Woohoo! Not a solo threader anymore. I guess I have now made the transition from having a life to having a thread/blog.

 

Lucid, thanks for the advice to read and read. I have been and will be doing for the foreseable future...blah.

 

Gary...by mutuality it doesn't mean that I can charge the bank £30 every time I send them a letter. Although as it's not automated I may have a case. Its more like the terms that they impose can be used by both parties. I'll do more research on this one and try to convert you.

 

Well, I have loads to ponder on now. I still think I should go for CI but I think I am going to go and see medium and see what the psychic world has to say to this. It's as close as I can get to a crystal ball!

 

Yes I noticed you went for contractual. I guess that maybe as long as the claim is small it doesn't make it worthwhile to defend. Who knows what the banks think about it all.

[Guest bong]

hi RD, have followed your link hear from mcuth's thread. I have been doing some thinking about CI, and was struck by something that was stated in the westdeutsche landesbank decision

 

In equity compound interest can be awarded where there is a breach of fiduciary duty, because it is assumed that the fiduciary will have made compound interest on any profits made, but this equitable jurisdiction does not extend beyond fiduciaries. Therefore the bank had to argue the existence of a trust or other fiduciary relationship, and none could be found in the case.

 

don't get me wrong, I'm really just dabbling here in new territories, but this got me wondering about whether, if we (well not me anymore 'cos my claim is finished now) but you and other CI claimants, can make a case that albeit that there was no express trust (re. fiduciary) in relation to monies received by bank from penalty charges, there was a constructive trust - in view of the fact that the bank cannot claim ignorance of the law - the rest might follow, if you get my meaning.

 

constructive trust n. when a person has title to property and/or takes possession of it under circumstances in which he/she is holding it for another, even though there is no formal trust document or agreement, the court may determine that the holder of the title holds it as constructive trustee for the benefit of the intended owner. This may occur through fraud, breach of faith, ignorance, or inadvertence.

Definitions of constructive trust on the Web:

• 
  
• a trust created by a court (regardless of the intent of the parties) to benefit a party that has been wrongfully deprived of its rights

 

 

 

I then dug up this Law Commission report on compound interest and I think para 2.41 on page 21 could be useful The Law Commission COMPOUND INTEREST

 

I don't know if this is a case of wishful thinking or if it has been discussed before in the main CI thread. I suppose I ought to copy this post over there too, if you and others think its worth it, just to see whether it is something that can be developed.

 

I hope all this makes sense:)

[RedDeath]

Hi Bong thanks for stopping by.(I love that name hehe, even though probably is something quite sensible).

 

Yes I found my way to mccuth's thread thanks to Caro and felt compelled to post as he is claiming the same as me (well 5k more, a pittence really!).

 

Go back to post 68 on this thread where I had a brainwave about the westdeutsche case (links posted). I take it from the judge's notes that this was refused on the basis that there was no fiduciary in the agreement and you could argue that in our cases there is such fiduciary.

Consensus ad absurdum was an intersting comment the judge made which we could use in our favour. Again, easier to read previous posts rather than typing it all out. 68 onwards.

 

Constructive trust..interesting guess that is more ammo. Thanks for the links, my brain is a bit fried at the moment so I will have a proper read tomorrow. So far it looks quite promising.

 

So far it is my understanding that if the westdeutsche case is what is stopping us from claiming CI then the judges notes on it are what makes this viable.

 

I'm gonna give a lot more thought, but in the meantime thanks for stopping by. I guess I should check the CI thread, any interesting comments being made?

[photoman]

Reddeath and Bong

 

Sent you both PM's

 

(Red I know you've already got it, but I just wanted Bong to know too, as perhaps we should all discuss) ?

[RedDeath]

Yeah I am good with that. Gonna pick it up in the morning, but can't resist having a quick scan through it at the moment. Life is getting hectic at the moment as I am also suing the idiot (any one feel free to edit this as liable but it is a good choice of word) who shunted me 6 months ago and gave me severe whiplash! I now have all my claim forms to fill out. Anyway I digress.

 

On a different note. Spring time is upon us and with it new life. Me thinks this is a good omen to push this one through. The charges will give me a new life, quite poetic really!

[Glenn UK]

I do not see a reason why a claim would be struck out on the basis of claiming contractual interest.

 

I do not see a basis for arguing this is more likely because of the track allocation.

 

I understand that people are not convinced, however, it appears to me that quoting cases i isolation which is not very useful since one needs to look at the issues in a wide context IMHO.

 

Ill post more we my keyboard is fixed since tis as take me half a our to type!! LOL

[elsinore]

FWIW

Black's Law Dictionary describes a fiduciary relationship as "one founded on trust or confidence reposed by one person in the integrity and fidelity of another." A fiduciary has a duty to act primarily for the client's benefit in matters connected with the undertaking and not for the fiduciary's own personal interest. Scrupulous good faith and candor are always required. Fiduciaries must always act in complete fairness and may not ever exert any influence or pressure, take selfish advantage, or deal with the client in such a way that it benefits themselves or prejudices the client. Business shrewdness, hard bargaining, and taking advantage of the forgetfulness or negligence of the client are totally prohibited by a fiduciary.

As fiduciaries, financial planners must make fair and complete disclosure of all material facts and must employ reasonable care to avoid misleading their clients. The utmost good faith is required in all their dealings. Simply put, fiduciaries must exhibit the highest form of trust, fidelity and confidence, and are expected to act in the best interest of their clients at all times.

Els

[RedDeath]

Glenn, I agree one case alone may not change things, however if there is a chance that LTSB may ask for this to be struck out on the basis of CI then I rather be prepared for it. Also, in my poc I think I should be explaining my reasoning for CI so the more info the better.

 

I particularly like this Westdeutsche case as it states that CI can only be awarded where there is a fiduciary relationship present. I am looking at it as more ammo to fire their way.

 

Also, if this does work then everyone else will be able to claim CI and we may finally see a shift in the bank's approach to charges. Maybe an idealistic view but you just never know.

 

Oh, and good luck with the keyboard.

[Glenn UK]

Glenn, I agree one case alone may not change things, however if there is a chance that LTSB may ask for this to be struck out on the basis of CI then I rather be prepared for it. Also, in my POC I think I should be explaining my reasoning for CI so the more info the better.

 

As far as I'm aware and granted i don't read all the posts on the site, no one has had either their claim struck out or an application to strike it out on the basis of asking for CI. If anyone knows different it would be useful to have the facts.

There have been requests to strike portions of claims out on the basis of the Limitation Act but this has only been applied to the charges out of time by virtue of Sec 5 of that Act as far as I am aware.

 

I particularly like this Westdeutsche case as it states that CI can only be awarded where there is a fiduciary relationship present. I am looking at it as more ammo to fire their way.

 

It is worth noting that the original idea came from the site founder, one presumes had good reason for posting what he did? This doesn't mean, and never did, that claiming contractual interest was a foregone conclusion or even that it was an an entitlement, only that it was something to be researched and considered.

However, the case highlighted gives as much hope as it detracts from the case if you believe there is a fiduciary relationship between the bank and its customers. As much as we may think so there are cases where the courts decided there was and where there wasn't, so its a moot point until a Court rules on this situation.

 

Also, if this does work then everyone else will be able to claim CI and we may finally see a shift in the bank's approach to charges. Maybe an idealistic view but you just never know.

 

Unfortunately the primary problem with claiming CI has nothing to do with the principles involved and everything to so with the rate being applied coupled with the method of application IMHO.

If the claimant was able to use a lower rate then it wouldn't attract quite so much vociferous attacks in my view. The common misconception is that 'its simply greedy', whereas in truth the Claimant doesn't have a choice other than to ask the court to determine what a reasonable rate is. I cannot point to it now but i do recall someone being awarded less than 8% by the court on the basis that that was reasonable. So trying when people say that CCA is generous, then its a matter of what might actually be awarded by the court rather than being entitled to 8% as some have proposed.

 

Oh, and good luck with the keyboard.

 

What is quite clear to me is that the bank acted unlawfully and the term they rely on is an unfair terms by virtue of whichever paragraph it is in the UTCCR. If the banks wish to rely on this term then the way i read that act is that there should be a reciprocal term for the benefit of the consumer, either that or the term is unlawful.

 

Going on further the bank have certainly unjustly enriched themselves by the removal of the money they take unlawfully. They will have earned profits and benefits from that money, it seems to me that the law generally doesn't support this position and that leaving the banks with the benefits of their actions leaves them unjustly enriched.

 

It would seem reasonable for them to give back what they took plus any benefits they enjoyed. There are i believe precedents which support this view.

 

It would be easy to spend a lot of time debating the issues as to why this is or is not a good idea i.e. trying to claim CI, however, most of the info has been posted elsewhere and I would need a week to remember where everything was i had read.

 

The bottom line is i believe that it is reasonable for claimants to try to reclaim money the banks has taken along with the unjust enrichment they have gained. This not a view shared by all/many, take your pick which one you consider most appropriate.

 

something that has occurred is that some claimants have simply seen the figures and decided thats what they want back without doing any research themselves. I wouldn't suggest this regardless of the sums involved.

 

To summarise, CI is something you would need to research in depth, if you don't have the time or ability then claim CCA interest and make your life simple.

 

I can see no logical reason why a claim would be struck out in its entirety nor costs awarded against a claimant simply by using CI as part of their claim.

 

It could all go tits up if the claimant behaved unreasonably in some way though but this is not a function of CI per se. Its up to individuals to deal with their claim and assess the risks to them personally.

 

JMHO

 

Glenn

[RedDeath]

Thanks for the post Glenn.

Yes, I agree that there shouldn't be a valid reason for a claim to be struck out simply because of CI. I think it was Gary that strongly advised me against claiming CI and I am thankful for his opinions, as I will consider everything before hitting the courts. I think I will go for CI as I believe I should be paid it. In the meanwhile I will be sending out an ammended charge list to LTSB detailing everything. Letter will go out tomorrow and I will give them 14 days for it. This brings me on nicely to my next 2 dilemmas...

 

1/ I am considering claiming for damages.

2/ I live in scotland.

[natwesttookmymoney]

Subscribing because it's interesting.

 

Westy

[photoman]

Red

Have you read this thread?

It was for a claim against RBS and inc Contractual.

May help you with your issues about being in Scotland, and has some interesting bits regards interest.

http://www.consumeractiongroup.co.uk/forum/rbs-bos-successes/49470-contractual-interest-details-case.html

[RedDeath]

Hi Photoman,

 

Yes I have seen that link. I am actually basing my entire poc on that format. I believe that more detailed and relevant I make this the better chance I'll have.

 

I'm in the middle of drafting up some damages that I would be interested in submitting to the courts, well, before I submit anything to the courts I will post it here to hear people's opinions and see if it is feasable or not.

 

Oh, I'll try and catch up with you later with regards to the pm. Not entirely sure if about any relevance but interesting reading nonetheless.

 

Subscribing because it's interesting.

 

Westy

 

Thanks, I never thought way back in December when I first joined this site that I would be reading every possible bit of legal stuff there is, but then this is one case where it really is better to be prepared.