thesergeant v Woolwich

[thesergeant]

Can you please look over my first draft for my N244, all suggestions welcome! 8-)

 

Introduction

The claimant contends that this claim is in respect of charges applied to mortgage accounts. The claim does not concern the recovery of overdraft charges on a current bank account. This claim is therefore not effected by the outcome of the OFT test case and should proceed naturally through the courts without stay.

 

 

Summary

1. The Claimant had between 9th November 1995 and 7th October 2004 a mortgage account and further mortgage advance account (Account numbers xxxxxx & xxxxx), with the Defendant (‘The Account’); governed by the Defendant's Personal Mortgage Terms and Conditions ('The Contract').

 

2. The Claimant admits to breaches of the terms of the contract that require the Claimant to stay within agreed repayment terms and limits.

 

3. The breaches have led to the Defendant debiting the account with numerous default, arrears and administrative charges, between 16th July 1998 and 15th June 2001. A detailed calculation of the charges is annexed to the Particulars of Claim at Schedule (A).

 

 

4. The Claimant has received the General Form of Judgment or Order variably dated 4th June 2009, 9th June and received by the Claimant on 11th June 2009. The Defendant had given the Claimant no notice of the application. The Claimant notes that the N24 is erroneous as it states that the Claimant's claim should be struck as they are time banned under “S.5 Litigation Act 1980”.

 

 

5. The Claimant contends that no such statute exists as the "Litigation act" and assumes that the defendant is referring to the Limitation Act 1980.If this is the case,then the Defendant appears to be claiming that if S.5 Limitation Act 1980 applied to this claim, which the Claimant disputes, that it applies to all of the claim. This is not the case as the Defendant has stated in a letter of 18th January 2008 that they considered charges made between 2001 and the redemption of the mortgage in October 2004 to be within 6 years.

 

 

Limitation

6. The Limitation Act 1980 Section 20(1) states:-

Time limit for actions to recover money secured by a mortgage or charge or to recover proceeds of the sale of land.

 

 

(1) No action shall be brought to recover:—

(a) any principal sum of money secured by a mortgage or other charge on property (whether real or personal); or

(b) proceeds of the sale of land;

after the expiration of twelve years from the date on which the right to receive the money accrued.

 

 

7. The Claimant contends that the various penalty charges applied by the Defendant to the mortgage accounts of the Claimant are part of the principal sum secured by the terms of the mortgage. If this is the case then the time limitation should be held to be 12 years.

 

 

8. It can be seen from the statements supplied to the Claimant by the Defendant that the various penalty charges applied by the Defendant are detailed within the “Mortgage Statement” and that the Mortgage balance has been calculated accordingly. This the Claimant contends demonstrates that the penalty charges applied have been capitalised into the mortgage balance and are therefore part of the principal sum of money secured by a mortgage. If this is the case then the time limitation should be held to be 12 years and the application for the claim to be struck out on the basis of a 6 year limitation should be set aside and the Claimants Claim allowed to continue.

 

 

9. The Limitation Act 1980 Section 32 states:-

Postponement of limitation period in case of fraud, concealment or mistake.

 

 

(1) Subject to [subsection (3)] [subsections (3) and (4A)] below, where in the case of any action for which a period of limitation is prescribed by this Act, either—

 

 

(a) the action is based upon the fraud of the defendant; or

(b) any fact relevant to the plaintiff’s right of action has been deliberately concealed from him by the defendant; or

© the action is for relief from the consequences of a mistake;

 

 

the period of limitation shall not begin to run until the plaintiff has discovered the fraud, concealment or mistake (as the case may be) or could with reasonable diligence have discovered it.

References in this subsection to the defendant include references to the defendant’s agent and to any person through whom the defendant claims and his agent.

(2) For the purposes of subsection (1) above, deliberate commission of a breach of duty in circumstances in which it is unlikely to be discovered for some time amounts to deliberate concealment of the facts involved in that breach of duty.

(3) Nothing in this section shall enable any action—

(a) to recover, or recover the value of, any property; or

(b) to enforce any charge against, or set aside any transaction affecting, any property;

to be brought against the purchaser of the property or any person claiming through him in any case where the property has been purchased for valuable consideration by an innocent third party since the fraud or concealment or (as the case may be) the transaction in which the mistake was made took place.

 

 

10. If it is found that The Limitation Act 1980 section 20 were not to apply then the Claimant alternatively seeks permission to proceed with the claim under section 32 (1)(b) on the ground that the Claimant could not reasonably have discovered the Defendant's deliberate concealment of the facts relevant to the Claimant's right of action before the report of the OFT was published on 5th April 2006. The Claimant contends that the Defendant has elected to present its charges as if they were a legitimate loss or cost, whilst in actual fact the Defendant is profiting in a material sense from the charges. With this in mind the Defendant can be seen to have been operating without accountability to its customers; and to have consciously concealed the facts from them. The Defendant is clearly in a privileged position, having direct access to the Claimants Mortgage account and being able to make charges to it at will. The Claimant is entitled to know whether the charges applied represent a justifiable business cost, or whether they are in fact a penalty, and to expect that the Defendant will always conduct itself with integrity. The Defendant has not conducted itself in such a manner, instead the Defendant has maintained a veil of legitimacy in its application of what the Claimant contends are penalty charges. The Defendant has refused to provide any information as to how the charges are calculated. With these facts in mind it should be found that the Defendant has deliberately concealed a fact from the Claimant and that this could not have been discovered prior to the publication of the OFT report on 5th April 2006 and that it is at this point that the limitation of 6 years should be applied. Therefore the application for the claim to be struck out on the basis of being time barred should be set aside and the Claimants Claim allowed to continue.

 

11. If it is found that The Limitation Act 1980 section 20 & Section 32(b) were not to apply then the Claimant seeks permission to proceed with the claim under s.32 (1)© Limitation Act 1980. The Claimant contends that the penalty charges applied to the Claimant's mortgage accounts were conceded to on the mistaken presumption that the said charges did not amount to penalties.

 

 

12. In such cases three questions have to be answered (Kleinwort Benson Ltd v Lincoln City Council [1999] 2 AC 349):-

a) Was there a mistake?

b) Did the mistake cause the payment?

c) Did the payee have a right to receive the sum which was paid to him?

 

 

a) The Claimant contends that he did indeed he acted upon a mistaken belief that the Defendant was entitled to make such charges to his mortgage accounts. The Claimant conceded to the Defendants actions in making these charges believing them to be lawful.

 

 

b) The Claimant further contends that if he had known of the mistake at the time the penalty charges were applied to his mortgage accounts he would not have conceded to the application of such penalty charges to his accounts. The Claimant has demonstrated that he would have taken such action by his actions to seek remedy by making such demands to the Defendant and taking the current claim when negotiations failed. The OFT report was published on 5th April 2006, the Claimant made an initial approach to the Defendant in June 2007.

 

 

c) The Claimant contends that the Defendant did not have a right to charge such penalty fees to the Claimant's mortgage accounts. The Defendant could argue that they were entitled to receive recompense for the costs incurred due to the Claimants breaches, however the charges made do not represent such costs to the Defendant instead they are unduly enriched by the level of charges applied to the Claimant's mortgage accounts. The Claimant contends that the Defendant has refused to provide any evidence as to how it has calculated the charges applied to the Claimant's mortgage accounts and how these relate to its business costs. The Claimant further contends that the fact that the Defendant properly applies interest to the Claimant's mortgage accounts would give adequate recompense for the Claimant's breaches in such circumstances.

 

 

13. With these facts in mind the application for the claim to be struck out on the basis of being time barred should be set aside and the Claimants Claim allowed to continue as the Claimant would not reasonably have discovered the said mistakes before the report of the OFT was published on 5th April 2006.

Edited June 14, 2009 by MARTIN3030

[thesergeant]

Also added to the end

 

 

Application


 
The Claimant requests that the Court consider ordering that:-
1. The N24 General Form of Judgment or Order made on 4th June 2009 dated 9th June 2009 and received by the Claimant on 11th June 2009 is in error as to Law and should be set aside.
2. That Section 20(1) of The Limitation Act 1980 applies and that the above order should be set aside.
3. That Section 32(1)(b) of The Limitation Act 1980 applies and the above order should be set aside.
4. That Section 32(1)© of The Limitation Act 1980 applies and the above order should be set aside.
5. That the Claimants claim be allowed to continue and that the draft order of disclosure attached to the Claimants Allocation Questionnaire (attached) be considered for issue.
 
 
Statement of Truth

 

 

I believe that the facts stated in this section as above are true.

[MARTIN3030]

Yes looks ok.

The one you should go for is section 32 c since concealment or fraud is not easy to prove.

Mistake is no problem-and the Benson v Lincoln is the best of all case law to use since its very clear.

[thesergeant]

Do I have to send Woolsnitch a copy or just send it to the Court.

 

Will the Court consider it and make a decision or will they ask Woolsnitch if they want a hearing?

 

Should I ask for a hearing on the N244?

[thesergeant]

Any views on the Section 20 argument?

[MARTIN3030]

Unless the other side are in agreement there will be a hearing.

You only need to send to the court-they will send out to the other side.

Yes applications should be made on notice.

Once again there may be a requirement for you to amend POCs if you will be relying on the limitation act.

If the Court finds this to be the case then you will be told.

I suspect there may be a directions or case management hearing called-but Woolwich will be aware that there is very little defence to section 32c -it is more or less watertight for you.

Make sure that you have the judgements of the precedents (3 copies) available for use later.

[thesergeant]

Martin3030,

 

A very big thank you to you for your assistance and advice thus far .......... its good to have some one to point me the right direction - I haven't got this far before!

 

I take all I need to do is send in my N244 with the fee and my statement and the legislation and copies of Mortgage statements and Woolsnitch letter, I am relying on. Also enclose another copy of my draft order for disclosure as per my Allocation Questionnaire.

 

I take it I should leave all my alternatives in my statement ie - Section 20, if not then Section 32(1)(b) and © etc.

 

I have an almost complete and ready to go Court bundle waiting for them.

 

Here is my POC for your perusal, the only error I made was the end date for the Mortgage as it should have read 9th November 1995 and 7th October 2004 - should I mention this?

 

>>>>>>>>>>>>>>>>>>>

Introduction

The claimant contends that this claim is in respect of charges applied to mortgage accounts. The claim does not concern the recovery of overdraft charges on a current bank account. This claim is therefore not effected by the outcome of the OFT test case and should proceed naturally through the courts without stay.

 

 

Summary

1. The Claimant had between 9th November 1995 and 21st June 2001 a mortgage account and further mortgage advance account (Account numbers XXXXX & XXXXXX), with the Defendant (‘The Account’); governed by the Defendant's Personal Mortgage Terms and Conditions ('The Contract').

 

2. The Claimant admits to breaches of the terms of the contract that require the Claimant to stay within agreed repayment terms and limits.

 

3. The breaches have led to the Defendant debiting the account with numerous default, arrears and administrative charges, between 16th July 1998 and 15th June 2001. A detailed calculation of the charges is annexed to the Particulars of Claim at Schedule (A).

 

4. The Defendant has declined to answer the Claimant's written requests for information about any manual intervention necessitated by, and/or any administrative costs incurred as a result of, the said breaches. The Claimant avers that the Defendant's default charges are not intended to represent any alleged actual loss, but instead unjustly enrich the Defendant, which exercises the contractual term in respect of such charges with a view to profit.

 

The Charges

5. The Claimant will rely on a report from the Competition Commission 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.

 

6. The claimant will further rely on the statement of the Office of Fair Trading (OFT) concerning default charges in credit agreements, published on 5th April 2006, to demonstrate that:

 

a). The OFT’s recommendations regarding standard default terms in credit card contracts have wider implications, as regards bank current account agreements.

b). In a consumer contract, where the parties are not of equal bargaining power, any estimate that included costs which could not legitimately be claimed as damages from an individual consumer in a case brought at common law, and which made a material difference to the overall charge, is likely to constitute a penalty at law.

 

c). The interest ordinarily charged on an overdrawn balance of account would of itself be deemed sufficient compensation to the defendant in a claim for damages arising from account breaches of the said nature.

 

Penalty

7. Accordingly the Defendant's default charges are:

 

a. A penalty and therefore unenforceable, as they are an unreasonable pre-estimate of the probable loss to the Defendant and therefore contrary to common law - Dunlop Pneumatic Tyre Co. Ltd v New Garage and Motor Co Ltd [1915] AC 79.

 

b. Invalid under s.4 Unfair Contract Terms Act 1977 and therefore not binding on the Claimant.

 

c. In the event that the court finds that the charges are not a penalty, they are unreasonable within the meaning of s.15 Supply of Goods and Services Act 1982.

 

8. The Claimant is seeking the return of charges totalling £1,687.50.

 

Limitation

9. The Claimant contends that the various penalty charges applied to the account were capitalised and that as such the relevant period for this claim is twelve years.

 

 

10. Alternatively if it is decided that the charges were not capitalised then the Claimant seeks permission to proceed with the claim under s.32 (1)(b) Limitation Act 1980 on the ground that the Claimant could not reasonably have discovered the Defendant's deliberate concealment of the facts relevant to the Claimant's right of action before the report of the OFT was published on 5th April 2006.

 

The facts relevant to the Claimant's right of action are that the Defendant is unjustly enriched by exercising the contractual terms in respect of default charges with a view to profit. If the Defendant has elected to present its charges as if they were a legitimate loss or cost, whilst it is in actual fact profiting in a material sense from the charges, the Defendant can be seen to have been operating without accountability to its customers; and to have consciously concealed the facts. The Defendant is clearly in a privileged position to have a direct means of withdrawing monies from the Claimant's bank account. The Claimant is entitled to know whether the charges paid represent a justifiable business cost, or whether they are in fact a penalty, and to expect that the Defendant will always conduct itself with integrity.

 

11. Alternatively, the Claimant seeks permission to proceed with the claim under s.32 (1)© Limitation Act 1980, on the ground that the payments were conceded on the mistaken presumption that the said charges and interest thereon did not amount to penalties - Kleinwort Benson Ltd v Lincoln City Council [1999] 2 AC 349 - and that the Claimant would not reasonably have discovered the said mistakes before the report of the OFT was published on 5th April 2006.

 

And the Claimant claims

a). The return of £1,687.50 taken by the Defendant in charges between 16th July 1998 and 15th June 2001.

 

b). Interest under s.69 County Courts Act 1984 at the rate of 8% a year, from 16th July 1998 to 9th April 1999 of £1208.55 and also interest at the same rate up to the date of Judgment or earlier payment at a daily rate of £0.37p.

[MARTIN3030]

Yes I saw the Pocs and they look ok.

Yes to all your other questions.

[thesergeant]

Application, statement and evidence bundle served on the Court today.

[MARTIN3030]

Good well done.

[Teetacbin]

Good luck with this, I shall be watching closely as trying to do something similar

[thesergeant]

OK time for an update. Judge accepted my application and I am listed for a hearing on 9th October 2009.

 

I note that I am required to lodge duplicates of my documents for service on Defendant. I have received nothing from them - can I require them to serve all documents they rely on to me?

[thesergeant]

Anyone ?

[thesergeant]

Bump ?

[Blossomandebony]

Hi, Sergeant,

 

Just skimmed through yout thread and you POC look good.

 

I was alittle confused, (it doesn't take much!) about why you had to make an N244 application?

 

Surely if they have already made an application for a strike out, you simply object to the application by writing a statement and then attend the hearing to fight your corner?

 

Did they actually apply for a strike out or did they just put it in their AQ / defence that they would like the judge to consider it?

 

BAE

[themadcap]

How did this go?

[mlp123]

Been reading through a few threads etc and it l seems everything is going very quite.Has there been any cases resolved lately?