Beyond 6 years

[Ron Baker]

ROn

Ive been doing some reading, have you looked at

House of Lords - Kleinwort Benson LTD. v. Lincoln City Council

Kleinwort Benson LTD. v. Mayor etc. of the London Borough of Southwark and Others

Kleinwort Benson LTD. v. Birmingham City Council

Kleinwort Benson LTD. v. Mayor etc. of the Lo

 

House of Lords - Cave (Respondent) v. Robinson Jarvis & Rolf (A Firm) (Appellants)

 

House of Lords - Deutsche Morgan Grenfell Group Plc (Respondents) v_ Her Majesty's Commissioners of Inland Revenue and another (Appellants).mht

 

If you havent you should have a look for certain at Klienwort vs benson and DMG Vs Inland revenue

 

HTH

 

Glenn

 

PS dont have the link for DMG i can email you the doc if you dont have it.

Glenn you can e me the doc

 

 

Glen like a lot of people with no legal training i get bogged down, in trying to decided... i'm unable to concluded if we can recover under mistake after reading that lot? ...confused as what they have decided.. do we... don't we.

 

E mail me as to what you think.

 

Ron

[Guest Battleaxe]

My interpretation, we can claim

[angry-in-suffolk]

Hi Glen,

 

Having just read the first document I have a headache. I now understand (with respect to any legal eagles reading) why they charge so much. They eat dictionaries for breakfast. )

 

My first questions are

1. When dealing with banks are we claiming under private or common law?

2. Are we saying that the unjust charges and interest are a mistake of law?

 

In one section for the case against I read:

In holding that money paid under a mistake of law is recoverable, an essential factor is that the retention of the money so paid would constitute an unjust enrichment of the payee. What constitutes the unjust factor is the mistake made by the payer at the date of payment. If, at the date of payment, it was settled law that payment was legally due, I can see nothing unjust in permitting the payee to retain monies he received at a time when all lawyers skilled in the field would have advised that he was entitled to receive them and the payer was bound to pay them. Again it is critical to establish the position at the time of payment: if, at that date, there was nothing unjust or unmeritorious in the receipt or retention of the monies by the payee in my judgment it was not an unjust enrichment for him subsequently to retain the monies just because the law was, in one sense, subsequently changed.

I have highlighted the words all lawyers skilled because as a common man I would hope that there was at least one lawyer saying 'hang on a bit mate'

 

I then read

We must take this payment to have been made under a demand of right, and I think that where a man demands money of another as a matter of right, and that other, with a full knowledge of the facts upon which the demand is founded, has paid a sum, he never can recover back the sum he has so voluntarily paid

Well personally I have always argued that the banks charging structure is wrong and biased and being a common man I have never been allowed FULL KNOWLEDE - and even now the banks withhold knowledge from us.

 

I also read:

Furthermore, Kelly v. Solari (1841) 9 M. & W. 54, 55 Parke B. said of Bilbie v. Lumley that "All that that case decides is, that money paid with full knowledge of all the facts cannot be recovered back by reason of its having been paid in ignorance of the law," a statement which was reflected in the judgment of Lord Abinger C.B. at pp. 57-58.

and where this was the case against I would like to suggest that as bank consumers we have never been in full knowledge of all the facts?

 

I also read

Unless the payer can prove that he acted under a mistake, he cannot maintain an action for money had and received on this ground.

 

He must prove that he would not have made the payment had he known of his mistake at the time when it was made. If the payer would have made the payment even if he had known of his mistake, the sum paid is not recoverable on the ground of that mistake.

Again personally I am happy that having questioned the charges on numerous occassions and having had some of those charges repaid to me then perhaps the banks should pay us back interest.

 

Then I got excited

In my opinion the proper starting point for an examination of this issue is the principle on which the claim for restitution of these payments is founded, which is that of unjust enrichment. The essence of this principle is that it is unjust for a person to retain a benefit which he has received at the expense of another, without any legal ground to justify its retention, which that other person did not intend him to receive.

I don't think any of us intended the banks to prosper at our expense.

 

Further on I read

What, then, is the function of mistake in the field of restitution on the ground of unjust enrichment? The answer, one may say, is that its function is to show that the benefit which has been received was an unintended benefit. A declaration of intention to confer the benefit, even if unenforceable, will be enough to justify the retention of the enrichment. A mistake, on the other hand, will be enough to justify the restitutionary remedy, on the ground that a benefit which cannot be legally justified should not be retained where it was a mistaken--and thus unintended--benefit.

and here I ask myself have the banks admitted that they wanted to profit from us by adding interest to our charges and then compounding that interest on a regular basis?

 

Then still not 100% sure of what is right and wrong - but heading towards the side of - we can claim interest repayments back I read this

 

Zweigert and Kotz, p. 232. If the payer paid in the mistaken belief that he was under a duty to pay, it is prima facie unjust that the payee should be allowed to retain what he received. But the burden of proving that the payer knew that there was no duty, and was not mistaken, is on the recipient: Englard, International Encyclopedia of Comparative Law, (1991) vol. X, pp. 8-9, para. 5.13. Mistake in this context means lack of knowledge, and it makes no difference whether this is of fact or of law: Englard, p. 18, para. 5.30. As for the concept of enrichment, a person is enriched when he receives a payment which the payer was not bound by any obligation to make to him. The payee is entitled to retain the payment if it was made to him voluntarily, as in the case of a gift. The enrichment is unjust if the person who made the payment did not do so voluntarily and there was no obligation to confer the benefit: Zweigert and Kotz, p. 261.

and

the mistake which the payer made was in believing that he was obliged to make the payment because it was legally due to the payee. A further difficulty is that it produces a result which is one-sided and unjust.

Not being legal minded a lot of what I read went over my head but one thing holds true in my mind - and that one thing was told to me by a legal person.

 

'All contracts have to be fair and reasonable'

 

I may be barking up the wrong tree but based on these snippets maybe we do have a case to argue that we are entitled to claim back interest and charges, with interest beyond the limitations just to ensure that the banks have not been unduly enriched.

 

Kev

 

Note: I'm not a legal person - don't take my word for things - read the case yourself - these quotes were bits that I personally thought useful and relevent.

[Glenn UK]

In a nutshell

 

it seems to me that it matters not whether the payment of the charges is a mistake of fact or of law, if the defendant was not entitled to the moeny then we can relciam the charges and interest we paid on those charges.

 

Going further it also seems that the defendant has in fact concelaed the unlawfulness of the charges at the very least since the OFt report from its customers and therefore is alos potentially guilty of concelament under Sec 32.1.b.

 

Soemthing else that seems to be worth highlightng too is that although these are strcitly speaking private claims, there is a large element of public importance about the in the same way as there would be about a claim involving the revneue for example.

 

Abbey have 18 million consumer accounts i believe, i thik that in one of the reports i have read it says something like 75% of people in the uk have a bank account, the potneital impact of this issue is just like that of the imposition of tax on the population. Just a thought.

 

I have to formalise all my thoughts and order them because like the rest of you having done lots of reading and highlighting i know have to make the notes and get things in order.

 

The other things the documents do is help to understand what the banks might say in respect of their defence, this too will form part of my notes.

 

Its not an easy process, but i am getting to the stage where i am becoming quote fond of Goff LJ.

 

Weird I know,

 

Glenn

[Guest Battleaxe]

I am going to cite Lord Goff in my claim, if it comes to it. Had another read this morning and haven't changed my mind.

[Guest bong]

In a nutshell

 

it seems to me that it matters not whether the payment of the charges is a mistake of fact or of law, if the defendant was not entitled to the moeny then we can relciam the charges and interest we paid on those charges.

 

but Glenn, as the Limitation Act says that we have to make our claim within 6 years unless there was concealment or mistake, it has to matter. from what I have read, and like you I have a ton of reading matter to go over before I can make my final conclusions, from what I have gleaned, the mistake of law argument in Kleinwort is not really applicable to us, since that related to there having been a subsequent change in the law. In my opinion it isn't about whether we were ignorant of the law or the lawfullness of the charges because we are presumed to know the law. That is why I am concentrating on it being a mistake of fact. that being that the payments were believed to be legitimately due because we thought they had been calculated to cover the bank's costs. The OFT report and the Competition Commission report showed us that they weren't.

 

I think this argument is the strongest and ties in with the concealment which we can show, as you say, atleast since April 2006, because they are maintaining their position after challenge. I think it is the strongest argument because as I said in the other 6 year thread the bank would then have to prove that we didn't believe that when we made the payments. How are they going to counter this argument? By telling the court that of course we must have known it wasn't calculated by cost? Now there's an admission I wouldn't mind having:p

[soldier girl]

Hi Guys- Don't know have you've read up behind the scenes so apologies if 'sucking eggs' is appropriate

Misrepresentation does again come into the equation regarding 'Mistake' (see also 'Reality of consent').For Mistake to be operative, it must be of fact and not of law; the loss under mistake may not be relieved unless there has been misrepresentation by the seller. (Hence my PM to you Ron).Also, a contract affected by mistake is void;a contract affected by misrepresentation is only voidable.

This is of course IMHO

SG x

[Glenn UK]

When i says it doesn't matter if its a mistake of fact or law, all i mean is that whichever it is you can claim the money back.

 

well in Kleinwort vs Benson (i think) , Goff said it doesn't matter if its a mistake of fact or law, if the defendant is unjustly enriched the sum paid is reclaimable.

 

regarding your ignorance of the law, that is not an issue the issue is whether the charges are in fact lawful or not, since a case hasn't been heard yet you cannot know and will not know for fact that the charges are lawful or not. This is the purpose of the claim you are making will establish whether in fact the charges are unlawful and if they are then you have a claim that you paid under the mistaken belief that the defendant was entitled to levy those charges under the contract terms.

 

Further you are a reasonable person and you relied on the bank to provide you with a service and a contract that was a lawful contract.

 

it is unreasonable to expect that a consumer dealing with the bank would take legal counsel when being presented with the contract or matters arising out of that contract.

 

In other words you relied on them to be you fiduciary, now they will argue they don't owe you such a duty.

 

Being a reasonable person with no special knowledge, you relied on the banks (who do have specialist knowledge) actions and behaviour in this respect. They have sold themselves as 'fiduciaries' in all their dealings with consumers and so it would be reasonable for you to trust them to act lawfully at all times. IMHO they do owe you a fiduciary responsibility, you pay money into a bank account and they look after it for you, it would be reasonable for them to deal with you honestly and fairly and above all with respect for the law. incidentally they do owe a fiduciary duty when dealing with pensions, insurances, mortgages etc and so how would an ordinary consumer know when they have to deal as a fiduciary and when they do not?

 

Re concealment i agree they have concealed the facts, but whether they have done this deliberately and you can prove it or not is another matter.

 

They deliberately charged you the money, that is a fact. what isn't a fact yet is when their concealment begun?

 

So we also need to look at when they would have had the knowledge to suspect that the charges may not be lawful, and when i say this i mean when we can prove or logically imply this, not when we think they should have done.

 

It would be reasonable to presume that as experts they would have had sight of any reports/investigations into the banking industry s IMHO its a matter of finding out when the first time this issue was raised 'globally' so that we may cite that as the initiation event which the banks would have been aware of. I have found references from 2001 ish i think, if all else fails the OFT report would of course be relevant, it would be useful if anyone found earlier reports since these would push the date of their concealment back further and hence mean that any charges paid after that date were definitely concealed.

 

Anyway its all interesting stuff. Perhaps this is the kind of debate we need to collect together some arguments.

 

 

Glenn

[soldier girl]

sorry - my big gob got in between you two there :o

Good points Glenn Sir

sg x

[Guest bong]

Glenn, we know from the competition commission report that the charges are calculated for profit. this makes them unlawful.

 

re. the bank's duty to you - I believe the contract is lawful. what is not lawful is that the revenue from charges is not linked to their costs. They might argue they didn't have to tell you what their costs were - but you can answer that under the law you are only expected to pay a charge if it is representative of cost. So that is why you believed you had to pay the charge - you didn't have access to their internal accounting records to be able to dispute the charges and on that basis you had no reason to seek legal advice.

 

"So we also need to look at when they would have had the knowledge to suspect that the charges may not be lawful, and when i say this i mean when we can prove or logically imply this, not when we think they should have done." they were presumed to know the law. when they set the level of the charges and printed their first price list, they knew the price was not linked to the cost. they also knew this without a shadow of a doubt when their annual accounts were prepared and they received confirmation of their profit figure. they didn't need an external industry regulator or investigation to point this out to them.

 

just my views of course

[Glenn UK]

Glenn, we know from the competition commissioners report that the charges are calculated for profit. this makes them unlawful.

 

All due respect you dont know that, you are surmising, in a court of law the report is only evidence not facts, the OFT siad exactly this, only a court of law can rule them unlawful.

 

re. the bank's duty to you - I believe the contract is lawful. what is not lawful is that the revenue from charges is not linked to their costs.Agreed They might argue they didn't have to tell you what their costs were - but you can answer that under the law you are only expected to pay a charge if it is representative of cost. So that is why you believed you had to pay the charge - you didn't have access to their internal accounting records to be able to dispute the charges and on that basis you had no reason to seek legal advice.Agreed

 

"So we also need to look at when they would have had the knowledge to suspect that the charges may not be lawful, and when i say this i mean when we can prove or logically imply this, not when we think they should have done." they were presumed to know the law. As much as i agree with you im not sure that the case law i have read supports this view, ie that they should have known and therefore its concelament, That was the nub of the case of brockelsby which was superced by Klinwort vs benson. In other words the fact that the shold have known is sufficent for them to be guilty of concelament. when they set the level of the charges and printed their first price list, they knew the price was not linked to the cost. they also knew this without a shadow of a doubt when their annual accounts were prepared and they received confirmation of their profit figure. they didn't need an external industry regulator or investigation to point this out to them. As much as i agree with you on this issue, what proof do you bring to the table? When it gets to court what can we throw on the table that proves on the balance of probabilites that this is the case? If you have it i would be really good.

 

just my views of course

 

LOL Bong, this is a good thread and a good debate, whether either of us us rioght or wrong is not really an issue, its making us think our arguments through and then see what may come back. Incidentally, in one respect we should present all the possible arguments and facts and not restrict ourselves to the one we favour as being the most logical.

 

in other words i will argue for concelament and mistake.

 

Glenn

[Guest bong]

in a court of law the report is only evidence not facts, the OFT siad exactly this, only a court of law can rule them unlawful.

 

ok - there is no ruling, but (and I always have a but don't I?), all the ingredients are there for their acts to be deemed unlawful. if I commit an unlawful act, like shoplifting in front of loads of witnesses, was that a lawful act until I have been to court? you might say I haven't been found guilty of it yet but my actions are still unlawful, otherwise there would be no basis for arresting me and taking me to court. the fact that a bank won't set foot inside a court room has prevented anyone from getting a ruling, but if their actions are unlawful I can present my case based on what evidence I have.

 

As much as i agree with you on this issue, what proof do you bring to the table? When it gets to court what can we throw on the table that proves on the balance of probabilites that this is the case? If you have it i would be really good.

 

I will say that the proof lies in documents that I am not privy to, and that is why disclosure is essential. I think their out of court settlement record is also a good indicator that this is the case, although I appreciate that they may say it is in their shareholders interest to settle claims. I suppose I could get hold of their annual accounts but I am not qualified to interpret them - would the annual accounts show a net profit from charges income?

 

I agree that the more arguments we have up our sleeves the better prepared we will be for all eventualities, BUT (yet again!) I sometimes think it is better to keep things simple and getting into complicated arguments about fiduciary duty might be our downfall if they show even a chink of weakness.

[Glenn UK]

in a court of law the report is only evidence not facts, the OFT said exactly this, only a court of law can rule them unlawful.

 

OK - there is no ruling, but (and I always have a but don't I?), all the ingredients are there for their acts to be deemed unlawful. if I commit an unlawful act, like shoplifting in front of loads of witnesses, was that a lawful act until I have been to court? you might say I haven't been found guilty of it yet but my actions are still unlawful, otherwise there would be no basis for arresting me and taking me to court. the fact that a bank won't set foot inside a court room has prevented anyone from getting a ruling, but if their actions are unlawful I can present my case based on what evidence I have.

 

No the evidence of your unlawful act is plain for all to see, it doesnt rely on you going to court to produce that evidence, in this case however, only the court can deem the charges unlawful no matter what evidence you have before you hence the OFT position. This is because regardless of whether the banks charges exceed their costs their argument is that this is contractually allowed, we say it is not and therefore the courts have to adjudicate. Simply having all the facts still wont make it unlawful until the court says it is.

 

As much as i agree with you on this issue, what proof do you bring to the table? When it gets to court what can we throw on the table that proves on the balance of probabilities that this is the case? If you have it i would be really good.

 

I will say that the proof lies in documents that I am not privy to, and that is why disclosure is essential. I think their out of court settlement record is also a good indicator that this is the case. I suppose I could get hold of their annual accounts but I am not qualified to interpret them - would the annual accounts show a net profit from charges income?

 

LOL, in other words nothing! Sorry to be harsh but this issue is also covered in some of the case law, we cannot present a claim based on what might turn up following disclosure alone. although i entirely agree its quite likely that the defendant would in fact hang themselves if they were to actually go through the process of disclosure.

 

I agree that the more arguments we have up our sleeves the better prepared we will be for all eventualities, BUT (yet again!) I sometimes think it is better to keep things simple and getting into complicated arguments about fiduciary duty might be our downfall if they show even a chink of weakness. Sadly i don't think you have any choice but to think about it and to research ALL possible arguments, otherwise if/when you get to court over limitations act, litigants would show their weakness by not having the answers to the issues raised.

I think in part this is what has been happing, and i don't mean any disrespect to those who have suffered from this, its just how it seems to me. we are lucky in some respects because we are able to learn from their mistakes.

 

I think the problem is if you don't have an answer in court to the issues raised by the bank then how will that be perceived in court?

 

As i understand it the job of the court is to hear the evidence before them and decide on balance which side has proved its case best.

 

If the bank says its OK the litigant accepted the terms and conditions and therefore the charges stand.

 

And you fail to answer what would the court decide?

 

Clearly this issue is dealt for us largely by the stuff prepared and posted by the likes of BF. where we don't have this support yet is on the limitations act and thats where the action is going to be IMHO.

 

Its going to be the bing issue because its where the money issue is for the banks, the claims so far have amounted to little more than a scratch to the banks, a flea bite, with unlocking of the limitations act the costs rise enormously due to the potential for interest to be awarded plus of course that they will have to pay back all charges potentially however old for a period of six years from the time when anyone could reasonably have discovered the cause.

 

Limitations act is a big issue the banks will do everything to fight IMHO.

 

Glenn

[Guest bong]

I've enjoyed debating this with you Glenn and in some ways I half hope that the court doesn't strike out HSBC's defence to my claim because I want to win this statute barred argument!!!

[Glenn UK]

Bong

 

i think it has been fun too and should be continued by others who hopefully will put together thoughts and arguments for/against what we are saying so we can all develop and learn.

 

Glenn

[Guest bong]

what do you think about my point about the annual accounts?

[Glenn UK]

i doubt the published accounts would show enough detail to draw such a conlcusion, sadly!

 

glenn

[Guest bong]

they do show profits from charge income but I don't know if it is net of costs or not. I suppose we need an expert on this one.

[Glenn UK]

do they show cost too?

[Guest bong]

gawd knows I've got their Profit and Loss account for y/e dec 2000 open in another window and its a bit like a foreign language to me.

[Guest bong]

while I think of it, not strictly relevant I know, wonder how they're going to deal with their provisions in this years accounts for future claims. In the accounts I'm looking at they have to disclose litigation they are involved in and the basis of any provision they are making for it, and also provide against other future liabilities. that will be interesting - perhaps we will get a different view of how they really see these claims.

[Glenn UK]

Bong do you have a link for those accounts you were looking at please?

 

Thanks

 

Glenn

[Guest bong]

its here Financial Reports and Accounts

[Glenn UK]

mmmm

[Glenn UK]

Ron

 

I found a case called Nelson Vs Rye, in there, (page 6 when i print it out) where the judge confrims that where there is a fiduciary relationship limitations are not relevant when claiming against the fiduciary.

 

HTH

 

Glenn