Memnoch vs Lloyds TSB (inc. Contractual Interest)

[GaryH]

Memnoch,

 

You say you have never had an overdraft, yet you are claiming contractual interest? Contractual interest is claimed on the basis that the contractual interest rate they charge you on overdraft borrowings should be reciprical. If you haven't got an overdraft then you haven't got a rate of interest stipulated in your contract, which means you cannot claim for contractual interest! Your interest claim is invalid. Have you filed a court claim yet?

[GaryH]

Apologies if I misread, but from another post it seemed like Memnoch said his account did not have an OD facility. I had the very basic 'cash' account from Lloyds (the one where you can only use their cashpoints!) which had no facility for overdraft whatsoever. I assumed - wrongly perhaps - Memnoch's to be the same. Probably a good idea to check the account T&C's to find out if there is a rate stipulated and if there is, that it concurs with what you've claimed for.

[GaryH]

With regards to the case law Tom, any chance of a link or reference to the case/s you refer to?

[GaryH]

Again - the Case Law establishing reciprocity is clear.

 

Hi Tom,

 

Any chance of some details of the case law you refer to? It could be extreamly useful for myself, the OP and anyone else claiming contractual interest. As far as I'm aware, cases which back up the reciprocity principle's have been hard to come by thus far, dispite extensive research.

 

Cheers

[GaryH]

This is the problem Memnoch. Ultimately it seems that the contractual reciprocity principle is an untested one. I know that Zootscoot has researched it too and she has not been able to find anything solid to substantiate it either. Of course this does'nt mean that you could'nt be successful in argueing it to a judge, and as long as you feel confident of your arguement and are aware of the potential risks then go ahead and claim it. The unjust enrichment aspect is a good alternative arguement to which adds weight to it too, and I don't think one would prejudice the other.

 

Here's something I posted on Photoman's thread which you might find useful in helping you weigh up the pro's and cons - http://www.consumeractiongroup.co.uk/forum/lloyds-bank/54548-could-biggest-claim-site-6.html#post487756

[GaryH]

Good job. Just a couple of thing's that personally I'd change if they were mine;

 

You don't necessarily need to include these bits;

6. The Claimant will rely on the Competition Commission’s report entitled “Northern Irish Personal Banking,” published on 20th October, 2006, as evidence that the Defendant is aware that the income derived from its default charges is calculated to generate material profits and is not merely a means of recouping losses incurred in relation to Account defaults.

 

7. The Claimant will further rely on the Office of Fair Trading’s (“the OFT”) statement of 5th April 2006 concerning default charges in credit card contracts, as the OFT’s recommendations regarding standard default terms in credit card contracts have wider implications, as regards bank current Account agreements.

Your POC should be a concise statement of the factual basis of your claim, and state the legal principles on which you will rely. Para's 6. & 7. is supporting evidence which you'd disclose at a later date. No harm in leaving it in if you really wanted to though, I'm probably being picky.

 

No need to quote the UTCCR reg in full either;

5. – (1) A contractual term which has not been individually negotiated shall be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties’ rights and obligations arising under the contract, to the detriment of the consumer.”

Just cite it by its reference.

 

Also, bearing in mind that Lloyds defend on the basis that their charges are contractual services which are'nt required to be a pre-estimate of loss, I included this in my POC;

1.6 The Claimant will vehemently refute any contention that the charges made by the Defendant are contractual service charges which are as such not required to be a pre-estimate of loss incurred on the part of the Defendant. The Claimant believes such contention would be an attempt by the Defendant to 'cloak' its penalties, in order that it circumvent the statutory and common law provisions which prohibit contractual penalty charges with view to profit.

 

1.7 Without prejudice to paragraph 1.6 above, in the event that the Defendant’s charges were accepted as a fee for a contractual service, they are unreasonable under The Supply of Goods and Services Act 1982 section 15.

[GaryH]

So you've already filed it then? Ultimately its not going to make much difference I suppose, but there were no conditions attached to the offer - and you received it before you filed so you should really have taken it off the total. To continue to accrue interest on an amount that is no longer owed goes against the duty to mitigate your loss - as does rejecting a unconditional part offer. It won't be a major problem, but if they offer to settle and it does'nt include that particular portion of interest, you'd be advised to accept.

[GaryH]

Its an unconditional part-payment - why not accept it? By all means write back and clarify that its strictly a part-payment only, but I can't see how its going to benefit you to refuse completely.

 

http://www.consumeractiongroup.co.uk/forum/bank-templates-library/25716-rejecting-offers.html

[GaryH]

What do you think people, interested in thoughts from GaryH and Mindzai and anyone else that can think of how I can reply to this Defence ?

 

Its the same old boring bog-standard Lloyds defence which they've been using since... well, forever!

 

No need to reply to it, just press on with the AQ. As Tom said though, you can make reference to the fact that they don't address each point of the POC and give different versions of events when they deny something, as is required by CPR 16.5. Personally I'd use section G for this, rather than making a formal application to strike out.

 

Use the new strategy on the AQ - http://www.consumeractiongroup.co.uk/forum/general/53570-new-strategy-allocation-questionaires.html

 

Also see page 3 of that thread (statement of evidence) for some stuff on the 'service charge' arguement.

Also I get charged £7.00 each moth for the running of my account so all the stuff about 'free banking' really helps. :-|

Do you get your monies worth out of the benefits? If not then I would tell them where to stick their select account and get put back to a normal current account.

[GaryH]

There's more on the service charge arguement and 'cloaking' here - http://www.consumeractiongroup.co.uk/forum/general/53570-new-strategy-allocation-questionaires-3.html#post482194. Particularly the section of the OFT report is useful.

[GaryH]

Am I being too evil ?

Absolutely not.

 

Did you send all the related attachments as were linked from the thread?

[GaryH]

I really do hope the Judge allows me to reply to their defence, I would like the opportunity to make them sweat a bit.

You don't need the judges permission to reply to the defence. Its too late now though, as the reply would have to be attached to your AQ. Its not necessary anyway - save it for your witness statement.

[GaryH]

If there is any, I am not aware of it.

 

As ever though, if someone could show me something which substantiates contractual mutuality or reciprocity in the context that is relevant to our CI claims, then I would be very pleased to be proved wrong.

 

The only case law I have found in relation to CI is against the awarding of compound interest!

Westdeutsche v Islington BC

[GaryH]

Ok had the following letter from the bank today, is it usual ?

Yes.

On the same day I have received a 'Notice of Preliminary Hearing'

 

1st June 2007 at 10:00 am.

Expect SC&M to be there - or rather their barrister from a firm in Leicester.

[GaryH]

Oh, golf - weren't you going to PM me?

[GaryH]

Golf,

 

Sorry, yes I haven't checked my e-mail - I'll have a look.

 

Memnoch,

 

You'll want to be proposing directions at the prelim. See here - http://www.consumeractiongroup.co.uk/forum/guidance-notes/64911-got-court-date-guide.html

[GaryH]

Griffin,

 

The full witness statement is here -

http://www.consumeractiongroup.co.uk/forum/lloyds-bank/82148-got-court-date-important.html#post732096

and GuidoT's SoE here -

http://www.consumeractiongroup.co.uk/forum/lloyds-bank/47207-guido-t-lloyds-tsb-5.html#post774761

 

In any case, in view of the Berwick judgement its become clear that if a claim was ever seriously contested then its not enough. It does not demonstrate a breach of contract.

 

The Birmingham judgement was awful for Kevin but for the users and campaign as a whole it has in a strange way been beneficial. Kevins claim failed on account of the fact he did not demonstrate a breach of the account agreement - and he did not prepare his claim properly with sufficiant evidence, namely the account contract, for the judge to find in his favour. This is obviously something we all need to learn from.

 

We all now need to make sure we have the account T&C's in our evidence amongst other things. I'm going to update the thread in a couple of days with some new stuff.

 

Another highly significant thing to be highlighted was the courts apparently well known reluctance to imply terms into contracts - see paragraph 17 of the judgement. There are very limited occasions and very strict criteria under which they can do so - which obviously isn't great news for CI claims either.

 

Remember also that the Birmingham "victory" was an accident. The parties actually had a copy of the draft judgement over 3 weeks ago, and Lloyds have paid every claim since within that time, so I think that speaks volumes about how relevant they consider it to be also.

[GaryH]

the Judge said that I had it right on the ball at that point and also added that in his own personal experience, he felt that in my sort of contract it didn't work both ways.

Of course contracts don't always have to be mutual. If every term in every contract had an implied reciprical term then there would be no such thing as freedom of contract!

 

Well done at court. Sounds like you did very well.