Claiming on a Business account? Lets join forces?

[JOSH_IOU]

I couldn't agree more steven

[tifo]

I'm not sure I understand this - who is being offered credit by whom? Is it saying the sole trader gets the same protection as an individual for loans (s)he takes out up to £25k or that an individual borrowing money from a sole trader does.

 

The Sole Trader is the customer of the bank or finance company that offer credit up to £25k and gets the protection, even though it is a business to business transaction.

 

If the Sole Trader has his own customers to whom he/she offers credit, that customer gets the protection anyway as it's a business to consumer transaction.

[photoman]

As someone who had a Business account as a sole trader, I would like to offer some views on this.

 

1/ On a few occasions I did also have some loans with the bank, and in the agreements, they did always state that the loan was covered by the CCA74.

At the time, I did actually just think that this was simply because any such loan of such type was just automatically covered by CCA74, and that whether you were a personal customer or business customer, the actual total amount involved was insignificant.

 

So, yes I do see what you are now implying regards the exceptions in the legislation.

 

But unfortunately I do think it is perhaps clutching at straws in trying to use this as evidence that sole traders may also be able to benefit across the board from consumer legislation, provided their total indebtedness to the bank is less than £25k.

 

2/ If anyone has some issues to resolve with regards loans below £25k, then IMHO, yes I would say that you can invoke and use the CCA74.

However this does NOT change the sole traders position with regards the default charges currently in question.

The CCA does not cover these anyway, and never did (as indeed equally so, it does not apply to overdrafts on personal accounts either, as it is legislation designed to deal with loans not overdrafts).

 

Nor does it change the sole traders situation with regards the UTCCR99.

As a sole trader,regardless of whether any overdraft was above or below £25k, the situation regards legislation that you can or cannot invoke remains unchanged.

It is only with regards to actual formal agreed loans below the £25k threshold covered by the CCA74 that sole traders can perhaps invoke and benefit from some of the same protection as consumers.

[JOSH_IOU]

Thanks for the info Photoman and the long reply.

 

There are 2 seperate acts that have the word contract in i have seen.

 

The unfair terms in consumer contract act

and the Unfair contract terms act.

 

Has there been an amendment that binds the 2?

[photoman]

Thanks for the info Photoman and the long reply.

 

There are 2 seperate acts that have the word contract in i have seen.

 

The unfair terms in consumer contract act

and the Unfair contract terms act.

 

Has there been an amendment that binds the 2?

 

As far as I am aware (and I have not heard of any Banks defence that has tried to question or disprove this) then UCTA (The unfair Contract Terms Act) is applicable and so can be invoked in Business claims.

However, the UTCCR (The Unfair Terms in Consumer Contracts Regulations) cannot.

The key word (and thus difference) in the two acts is "Consumer", and in it's opening paragraphs the latter act sets out its' scope and jurisdiction by providing a description of consumer as being someone acting outside of their business or profession.

So if an account is set up for the purpose of doing business then it is still covered by the former act, but not the latter.

This is one of the reasons (apart from the difference in charges and fees) that Banks are not happy about someone operating a Business through a personal account, and so urge people doing so to change the nature of their account.

In short, if they suspect that someone is using a personal account to operate a business they kick up a fuss, and get you to open a business account so that: a/ they can then charge you more in fees etc, and b/ they have less liability to you.

[JOSH_IOU]

Yes i knew about the UCTTR's Just like Lloyds TSb Are now exempt from CCA (consumer credit act) in the 2008 amendments that came into force last month. The UCTTR's cover Business to consumer contracts Thats how i think of it any ways.

 

Its my understanding though that there is a lower limit on the CCA some sites say £100. Dose this mean I should wait before i threaten court action and let the banks knock up the charges to £100 They stand at 76 at the moment and ive already complained about them. ( but i have not as yet threatend court action)

[TINK660]

zootscoot,

Hi all,

 

Does any body have any business account T & Cs preferably historic ones but any will do.

did you receive the terms and conditions of nat west business banking 1996 that I send you last week.

 

Tink

[TheyrCriminals]

Hi Guys,

 

Can anyone please post up all relevant sections of the Unfair Contract Terms Act (1977) in relation to business claims. A friend of mine has had a letter from Barclays Bank plc singing the tune of the fact that the penalty at common law argument is likely to no longer be applicable. In addition Barclays is confident that the same approcah will be taken to the historic terms and conditions. They may turn out to be right or wrong, however in the mean time we need everything we can get our hands on in the Unfair Contract Terms Act (1977) to support the legal avenue for business claims.

 

Any help appreciated.

 

TheyrCriminals

[photoman]

Okay,

I have been informed that CAG is currently doing some work with regards the implications of the recent OFT case upon small business claims.

 

So, if you can afford to wait a short while, then I am sure there will be something solid available soon to aid Business claimants.

 

In the meantime, you can always download the act (I think it's available from the CAG statutes library, otherwise there are several other online sources), and previous thinking was that you should be taking look at section 4 (and I imagine this will still be advocated for use in future CAG strategies/POC's etc).

 

Although section 4 does keep mentioning the word "consumer" in said paragraph, in the opening paragraphs of the act it does stipulate what contracts the act actually covers:

quote:

"to limit the effect of unfair terms in consumer and small business contracts"

 

So this means it does also encompass and cover contracts for small business'.

 

PM

[TheyrCriminals]

Hi Photoman,

 

It's good to know CAG are working on something. I will begin research on exact wording of the Act itself and hopefully, as you appear to have already demonstrated, we should be able to rely on it, lets hope so. Many thanks for that.

 

TheyrCriminals

[hsbcfiddled]

Does anyone know what a Management Fee £10 is applied for by HSBC?

It is sometimes applied on its own or sometimes with £28 charges for unpaid item or recall so/dd?

[papadak]

Hi,

 

This is Business claim for a Bank Account

 

I am claiming on behalf of a family friend and received the following letter back this morning from Barclays ...

 

"

 

Please note this account is business related and not a personal one, so this request for repayment of charges falls outside the scope of Unfair Terms in Consumer Contracts Regulations 1999 and the current office of Fair Trading investigation into unauthorised overdraft charges. So your request has been dealt with as a general charges complaint, and considered by us accordingly.

 

We consider that all the charges that we have levied are as documented in out Tariff of Charges, Business Banking Conditions and Welcome pack, and are consistent with good banking practice and our commitment to treat our customers fairly. We regard such charges as lawful. and therefore cannot agree to your request to refund these charges.

 

"

 

I would appreciate your comments please and whether or not I have a chance.

 

Thanks,

[hsbcfiddled]

Hi,

 

This is Business claim for a Bank Account

 

I am claiming on behalf of a family friend and received the following letter back this morning from Barclays ...

 

"

 

Please note this account is business related and not a personal one, so this request for repayment of charges falls outside the scope of Unfair Terms in Consumer Contracts Regulations 1999 and the current office of Fair Trading investigation into unauthorised overdraft charges. So your request has been dealt with as a general charges complaint, and considered by us accordingly.

 

We consider that all the charges that we have levied are as documented in out Tariff of Charges, Business Banking Conditions and Welcome pack, and are consistent with good banking practice and our commitment to treat our customers fairly. We regard such charges as lawful. and therefore cannot agree to your request to refund these charges.

 

"

 

I would appreciate your comments please and whether or not I have a chance.

 

Thanks,

 

 

Shouldnt the claim have been made under 'Common Law'?

[papadak]

Shouldnt the claim have been made under 'Common Law'?

 

 

ok & how does that compare/work ... is there a template out there?

[hsbcfiddled]

ok & how does that compare/work ... is there a template out there?

 

 

I have here a link that I used to claim successfully at the turn of the year http://www.consumeractiongroup.co.uk/forum/bank-templates-library/105213-guide-business-claims.html

 

however dont build your hopes up because I see that the link now advises not to claim - well at the moment anyway.

 

hsbcfiddled

[photoman]

Papadak

 

I presume the letter was in response to a letter, rather than an actual court claim (POC).

I would advise yourself (and other business claimants), to hold fire on actually filing a court claim at the moment.

Also for anyone who has already filed a claim, and so at court stage, you may even need to file an amendment to your POC's, so if your timing allows it, then sit tight and wait for further advice.

 

PM

[JOSH_IOU]

Why not use the Unfair terms in contract act 1977.

 

This is not being discussed in the test case.

[TheyrCriminals]

Hi Photoman,

 

I have looked at s4 of the Unfair Contract Terms Act (1977) but I do not know if this is the correct section we should be looking at, the section in its entirety is as follows:-

 

4.

Unreasonable indemnity clauses.

— (1) A person dealing as consumer cannot by reference to any contract term be made to indemnify another person (whether a party to the contract or not) in respect of liability that may be incurred by the other for negligence or breach of contract, except in so far as the contract term satisfies the requirement of reasonableness.

 

(2) This section applies whether the liability in question—

(a)

is directly that of the person to be indemnified or is incurred by him vicariously;

 

(b)

is to the person dealing as consumer or to someone else.

 

 

I will continue reading through the Act but if anyone knows for certain any relevant sections can you please post them up.

 

TheyrCriminals

[photoman]

I posted this on the OFT thread

 

 

Here is my take on UCTA77

 

Section 4 says:

 

4. Unreasonable indemnity clauses. —

(1) A person dealing as consumer cannot by reference to any contract term be made to indemnify another person (whether a party to the contract or not) in respect of liability that may be incurred by the other for negligence or breach of contract, except in so far as the contract term satisfies the requirement of reasonableness.

 

(2) This section applies whether the liability in question—

(a)is directly that of the person to be indemnified or is incurred by him vicariously;

(b)is to the person dealing as consumer or to someone else.

 

 

In short, it deals with forbidding any attempts to recuperate costs from a consumer (us) that were incurred by the other (in this case the bank) by making reference to a term in the contract and claiming that such costs were incurred were due to a breach of such a contractual term (or some negligence has occurred).

 

So, this depends upon how the charges were presented at the time to the claimant.

 

In the past, some Banks in such circumstances would present the charges as pertaining to service charges or fees (which they are all now attempting to do, but have just had dismissed as untrue)

However, others did actually present them as relating to a recuperation of costs incurred dealing with such events.

Lloyds (and a few others) certainly did the latter.

 

If the former case (presented as service charges or fees), then claiming sec4 of UCTA would do no good anyway, so instead, one needs to argue and question just what service was actually provided (which is in fact currently none, as proven by the recent OFT judgement, and will soon also be deemed as applicable historically).

 

If the latter, and they were claimed to be a recuperation of costs, and arose due to a returned item ie. your attempt at going over your limit, ie. a failure to adhere to an agreed limit, then this could plainly be deemed as arising due to a breach of contract (an agreed limit is after all a contractual obligation).... so I personally think section 4 could definitely be invoked.

 

So, for those banks that presented them as relating to a recovery of costs (which we lay claim as also being due to a breach of contract), then under the terms of UCTA77 they had no contractual rights to claim such sums, and the pursuit of such "costs" should have really been pursued through the courts (rather than just calculating, massively marking up and then enforcing themselves, without any accountability as to the true cost).

 

If this had been the case, then they would have had to go through the same processes as ourselves; i.e. prelim and LBA to demand the true costs to be paid under threat of court action (which at just a few pence we would all just pay). If they then persisted in presenting them at massively marked up rates, and it went to the court, they would have lost, and would also have massive costs to bear.

 

That's my tuppence worth anyhow.

I think it's a fair assessment, but I would be interested to hear others views.

 

PM

[photoman]

PS: Just to clarify that the UCTA77 DOES cover small business' (upto 9 employees I think), so any reference to "consumer" includes small business'.

 

PM

[TheyrCriminals]

Hi Photoman,

 

Thanks for those posts, I now see what that section is referring to.

 

Your stance on the issue is particularly plausable, however my concern is that even UCTA (1977) appears to state that in order to invoke the Act there still needs to be a breach of contract. I am pretty sure the judgement in the oft test case made it clear that the banks' charges were not imposed as a result of a breach of contract.

 

TheyrCriminals

[JOSH_IOU]

Ahh but dose the act actually say who has to have breached the contract?

[JOSH_IOU]

Consumer Credit Act 2006 - BERR

 

 

Consumer Credit Act 2006

 

The Consumer Credit Act 2006 establishes a fairer, clearer and more competitive market for consumer credit, updating consumer credit legislation that has been in place since the 1970s and making it more relevant to today’s consumers.

 

We are well on the way to implementing the Act. Many key provisions have come into force and the Act is due to be fully implemented by October 2008.

 

 

On 6 April 2007, the remit of the Financial Ombudsman Service (FOS) was extended to cover consumer credit and the Unfair Relationships Test was introduced for new agreements. On 6 April 2008, the OFT’s new strengthened licensing regime was introduced, the Consumer Credit Appeals Tribunal (for appeals against OFT licensing decisions) was established, the financial limit (of £25,000) was removed so all new credit agreements (unless specifically exempt) regardless of value are regulated, and the Unfair Relationships Test was extended to all existing credit agreements.

From 1 October 2008, lenders will be required to provide borrowers with much more information about their accounts, such as an annual statement and regular notices when consumers fall into arrears or incur a default sum, and debt administration service providers and credit information (repair) service providers will need a consumer credit licence as these services will be regulated by the OFT.

[TheyrCriminals]

Hi Josh,

 

Can you explain your previous comment about does it matter who has to be in breach of contract please?

 

TheyrCriminals

[JOSH_IOU]

Who has to have breached the contract for the act to apply to the terms of the contract?

 

The consumer or the suplier?

Edited May 18, 2008 by JOSH_IOU
aply not aplt