Gandolfi v NatWest

[gandolfi]

Hello All - I'm new here and in need of some help.....with apologies for the long introductory thread that follows.

 

I'm so glad I found this site and am hoping that it will mark a turning point in my life, as I feel I have been a victim of unfair bank charging for too long and it has led to a huge mess in my financial affairs that I intend to reverse.

 

Last month, NatWest issued a County Court claim to me for my outstanding loan and business current accounts. My accounts were effectively closed in early 2005 after I was unable to meet payments and NatWest had been piling on penalty charge after penalty charge. While I have tried to make repayments over the last two years the bank have continued to charge 29.5% UAB interest rate (despite my requests to reduce it).

 

After years of being afraid to challenge the bank for fear of them demanding all of the money back through the court, they have now forced me to act and try to reclaim the years of excessive charges imposed on my accounts.

 

Following some of the advice given in another thread, I have submitted my defence to the court saying that the debt is in dispute because I believe it contains unlawful charges/penalties. I have also sent a SAR to the bank, informing them that in the meantime I will calculate my claim for penalty charges and interest on the basis of the information I already have. (I also sent a copy of this letter to the court)

 

I've kept most of my business bank statements - from the first one in 1989 (which has written at the top "thank you for opening this account") to the time when the account was terminated. I also have the majority of my personal current account statements (which has also been subject to charges), so the information provided by NatWest (if they send it) will fill in any gaps that might be missing.

 

I am in the process of working out exactly how much they owe me, but it will be very clear that the accumulation of their unfair charges and interest forms the very basis of my indebtedness to them. Periods of problematic cashflow were persistently met with disproportionate charges throughout my relationship with the bank over 18 years. I now realise that this deprived me of money which would have eliminated the need for expensive overdrafts and loans.

 

I'm already very grateful for all the information that I have gathered here. However, I am aware that I am doing this in a back-to-front way by responding defensively to their court action. I have missed out the usual steps of sending Prelim and LBA letters, and so I am unsure of what I do now.

 

To be clear, I intend to reclaim charges on both my business current and personal current accounts, plus interest. Can I do this within my defence of their claim, or do I make my own claim through the courts? If so, do I need to follow the timescale procedures of prelim/LBA refund requests? Or do I just go ahead with issuing a court claim? Also, do I need to issue separate claims for business and personal accounts?

 

Thanks in advance for any help and advice you can give.

 

To say that I am scared and feeling out of my depth would be a huge understatement, but I am determined to fight this.

 

Best wishes to all.

[Parkvale]

Welcome to the Nasty West forum:http://www.consumeractiongroup.co.uk/forum/bank-templates-library/64975-business-claims-basic-guide.html

http://www.consumeractiongroup.co.uk/forum/site-questions-suggestions/53182-cant-find-what-youre.html#post436526

It would be easier if you could post their defence. Then we can see if you have missed anything on your claim.

[gandolfi]

Hi Parkvale

 

Sorry, I should have been clearer. It is they (NatWest) who have issued a County Court Claim against me for outstanding debts on my accounts. I have submitted my defence against their claim on the grounds that the debt contains (was caused by) unlawful charges.

[Parkvale]

Gotcha,

Then ask them to hold any further action on your account

Ask your creditors to hold action on your account.

 

 

1 High Street,

Newtown,

Kent

R21 4RH

 

June 28, 2006

 

The Loan Company

Company House,

Church Street,

Newtown,

Kent,

R1 7HG

 

Dear Sir/Madam

 

Re:− Account/Reference Number

 

We are writing to inform you that we are seeking advice and assistance regarding our current financial difficulties.

 

To this end, we would appreciate if you could hold any action on the above account for a period of at least 28 days.

 

Also, during this period, could you please freeze interest and/or any other charges accruing on the above account.

 

We look forward to hearing from you as soon as possible.

 

Yours faithfully

[gandolfi]

Thanks Parkvale

So I write to NatWest to ask them to hold action on the accounts for at least 28 days. And while the account is on hold do I begin the procedure of demanding the penalty charges back by sending the preliminary letter?

[Parkvale]

Exactly, onwards and upwards for you now http://www.consumeractiongroup.co.uk/forum/bank-templates-library/92-3-letter-before-action.html

[gandolfi]

Hi Everyone - hoping for some help on a couple of points. My head's hurting from reading and trying to work out the correct plan of action. I'm keen get it absolutely right from the very beginning.

 

On my business account, I'll be claiming £7200 of charges plus the interest incurred as a result of those charges (it will be substantial, but I'm still in the process of calculating it). The charges began in 1991 with several 'hot-spots' in 1994/95/96/97 and 2004/05 which Natwest encouraged me to put into a consolidating loan (more interest!). I'll also be making a similar claim for my Personal account for £1420 charges + incurred interest.

 

On both accounts I want to also claim contractual interest for their use of my money (for depriving me of the use of my money) over that period of time. However, I'm struggling to find a clear outline of what the contractual rate ought to be. They are currently charging me their UAB rate (29.5%?). If I apply that to the figures my claim will be very substantial indeed.

 

It would be a great help if someone could let me know what NatWest's current overdraft/borrowing rates are...? And advice on which to apply to my claim. I've read that it is wise to state the contractual interest from first Prelim letter, so I want to get it right and stick to it.

 

Also, if anyone can direct me to the most recent spreadsheet for calculating contractual compound interest, I'd be very grateful.

 

Thanks to all!

[Parkvale]

http://www.consumeractiongroup.co.uk/forum/natwest-bank/79547-natwest-charges-guide.html, Good luck.

[gandolfi]

Thanks Parkvale - I'd missed the link that includes interest rates on Nattie's thread about charges.

 

The most recent rates shown on the thread are from Sept 2004:-

 

Agreed O/D 16.49% (Equiv 1.37%pm 17.8% EAR)

UAB 2.195%pm (29.69%EAR)

 

Do you know if these rates are still current on both business and personal current accounts?

 

Also, when applying the contractual interest to my claims can I calculate it on a monthly basis (@ 1.37% or 2.195%) on the accumulating total charges? Or is there a spreadsheet that will work out the contractual 'compound' interest, rather than the calculation of 8% 'simple' interest that the court will apply? (also confused about differences between 16.49% and 17.8%EAR and 1.37% equivalents and how to apply them).

 

Thanks again for your support!

[gandolfi]

An update on my first post which detailed how Nat West are taking ME to Court for debts on my Business O/D and loan accounts (totalling £15k)....and my defence that the debt is made up of their charges...

 

I submitted my defence to the Court last week on the grounds that the entire debt is made up of unlawful charges and subsequent interest incurred. I informed them that the debt is in dispute and that I would be claiming back all unlawful charges and interest.

 

At the same time I sent my SAR to the bank and a separate letter asking them to freeze interest and hold action on the accounts for at least 28 days (as advised above), while I seek help and advice (and prepare the figures for my claim).

 

Today I received a 'Notice That a Defence Has Been Filed' and a copy of the Allocation Questionnaire (which has to be returned by 30th April). I'm assuming that it is NatWest who must fill this in as it is THEY who are sueing ME. Is that right??

 

I am so scared that I will mess up my chances of claiming my charges back because I first have to defend myself in Court from NatWest's claim for the money I owe them. What is their response to my Defence likely to be?

 

I'm preparing the figures as fast as I can, but I want to make sure everything is watertight with my claim before I start. It is clear that by the time I've added it all up, it will be them that owe me money and not the other way around!

 

At what point should I let the moderators here know about this and how do I do that? I think I'm right in thinking that my case is unusual because NatWest have taken Court action AGAINST ME to recover a debt that I am now claiming (in my defence) is made up of unlawful charges.

 

I'm worried that by the time I have finished the calculations, sent my Prelim and LBA (at least 28 days), it will be too late to defend myself against NatWest's claim.

 

Everything feels so upside down.

 

Sorry for the panic. Any help appreciated.

 

:?

[Parkvale]

Calm down or you will have a heart attack. The AQ is for Nat West to fill in. You will have to try and keep both cases seperate at the moment. Continue on with your bank charge claim. Keep us posted

[gandolfi]

Thanks Parkvale - seems you are the only one out there.

 

I'm taking deep breaths...

 

I can't stop thinking what their response to my defence will be. I imagine they will try to get my defence struck out won't they? - in which case I will have to pay up or get CCJ against me...

 

I want to be sure that my Defence is strong while I prepare my claim against them. What are they likely to throw at me?

 

Sorry to keep burdening you with questions Parkvale. All others welcome to chip in.

 

Thanks!

[Parkvale]

You might be surprised. If they know you are chasing them for the bank charges, It makes sense for both parties to come to some agreement. It quite clearly states in the civil procedure rules pre action protocol thatit is the aim of the courts to avoid the premature commencement of proceedingsby requiring the parties to exchange information as early as possible. It might be worth dropping them a line and reminding them of that.

CPR - Pre-Action Protocols

[GuidoT]

You are required to complete the AQ too, this to an extent is relevant:

http://www.consumeractiongroup.co.uk/forum/bank-templates-library/11644-allocation-questionnaires-guide-completion.html

Say in section G/H that you require further time to particularise your defence and will be filing an amended defence as you are awaiting a response to your SAR.

I see that you have issued a defence and I assume that this does not include any penalty charge calculations.

In your position I would dispense the prelim and LBA and issue an Amended Defence and Counterclaim once you have all the quantum calculations. You need to do this soonest, if you are unable to calculate all the charges estimate some and then issue a further Amended Defence and Counterclaim once you can accurately calculate.

Can you post up your Defence please or is it as per the site template?

Another option (although not one I would prefer) is you can start a separate claim yourself for the charges as Claimant. I would then ask that the court combine to two - I have no direct experience of this though and not even sure if it is possible, I have just seen it referred to on this site.

As you are probably realising your position is different to most here.

Did Natwest issue you a prelim and LBA?

[GuidoT]

Calm down or you will have a heart attack. The AQ is for Nat West to fill in. You will have to try and keep both cases seperate at the moment. Continue on with your bank charge claim. Keep us posted

 

This is not correct, both parties are required to complete the AQ.

[gandolfi]

GuidoT - thanks so much for your response. That is a great help.

 

As you suggest, I would prefer to submit an amended defence and counterclaim with all of the calculations. I have until 30th April to submit the AQ to the Court, so hopefully that will be enough time to get that done.

 

You are right that my defence didn't include the calculations - I didn't want to submit inaccurate figures. My defence statement was as follows:

 

"Claimant: National Westminster Bank Plc

135 Bishopsgate

London

EC2M 3UR 10th April 2007

 

Claim ref: ********

 

Sort code: ******

Account Numbers:

******** (Business Current

******** (Loan)

 

I intend to defend this claim in full, including all outstanding debts on both of the accounts listed in the particulars of claim.

 

The debt is in dispute as I believe it contains unlawful penalty charges. Accumulated disproportionate penalty charges – which I believe to be unlawful – and the interest levied upon them throughout my relationship with Nat West are the very basis of my indebtedness to them. I intend to claim back all unlawfully applied charges and the interest levied upon them by the bank.

 

I now understand that the regime of penalties which Nat West have been applying to my accounts in relation to direct-debit refusals, exceeding overdraft limits and so forth are unlawful at Common Law and contrary to statute. Penalty charges are irrecoverable at common law. The precedent for this was Dunlop Pneumatic Tyre Co Ltd v. New Garage and Motor Co Ltd [1915] AC 79 along with Murray v. Leisure Play [2005] EWCA Civ 963. It was held that a contractual party can only recover damages for an actual loss or liquidated losses. It is clear that the penalties imposed on my accounts by Nat West do not reflect any actual or real loss.

 

I have written a Subject Access Request (Data Protection Act 1998) to Nat West (copy enclosed) asking for full disclosure of all transactions and charges, as well as evidence of manual intervention on my account. I have kept the majority of my bank statements and will therefore, in the meantime, calculate my claim for repayment of charges and interest (plus contractual interest for the bank's use of my money), on the basis of the information that is available to me.

 

It will be clear that were it not for the bank's disproportionate and unfair penalties on my accounts – persistently applied over many years – the debt for which they are claiming would not exist."

 

Is that OK?

 

I haven't received Prelim/LBA from them recently (no written communication from them this year). They did send letters around the time the accounts went into meltdown (2005) threatening this I think. I haven't kept them as I thought I had got it under control by negotiating small repayments with them, which unfortunately I wasn't always able to make. They refused to lower the interest from 29.5% unless I made six consecutive monthly payments. The debt has just carried on increasing.

 

I know this probably doesn't count for anything with the bank or the courts, but since July 2005 I have also been trying to cope with personal loss and grief after the London bombings, as well as this huge weight of debt on my shoulders. If the bank only new how much pressure I have been under.

 

Thanks for your input Guido T. Much appreciated. I'll follow your advice re: the AQ and get on with my calculations.

 

All best wishes

[Parkvale]

Good guidance from Guido and good response from you.. That needs to get away to the bank.ASAP. Again they have to oblige by the CPR pre action protocal. So their continuence of their case against you could be looked on by the judiciary as very heavy handed.

Good luck.

[GuidoT]

The Defence needs some further work, but that can be picked up when the amended defence and counterclaim is filed once you have done your calculations. There is a risk that NatWest will seek to have your defence struck out because it has no calculations, but we have some time.

 

To afford you some protection it would be prudent to write to the Natwest (I presume Cobetts) and advise that it is your intention to file an amended defence and explain why you have not done so to date.

 

Was your company, Ltd, sole trader, LLP...?

Did Natwest bring the action using the correct name?

Do you have a non business claim (personal) too?

 

Sorry to hear about your loss relating to the bombings, Natwest do not care about that, but we do.

[gandolfi]

Thank you Guido T - it's great to feel that someone is on your side.

 

The Business account was sole trader.

 

The claim was sent to my name and not the name of the business (although my name is part of the full business name - equivalent to 'Gandolfi Contemporary Architecture' or similar).

 

Yes, I do also have a personal claim for £1500 + interest incurred + contractual/court interest. This is in addition to the £7200 + interest incurred + contractual/court interest. When the business account went pear-shaped in 2005 Nat West moved funds from the personal account into the business account and closed my personal account. So they are connected in that way. Can I combine them into a single counterclaim?

 

So far I haven't had anything from Cobbetts, just a Nat West correspondance address in Telford that is on the claim form with the Bishopsgate address. I will draft a letter to them informing them of anticipated amended defence.

 

I am away tomorrow, but will be back on friday to pick up responses to this and will work on draft letter then.

 

Thanks again.

[GuidoT]

Arguably they have commenced the action in the wrong name, but it is a weak argument as you are the sole owner and you probably do not want to argue this point for the reason below.

 

As they have commenced against you personally, then yes include your personal claim. It looks like you may need it in an effort to extinguish the £15K.

 

Once you have completed your calculations we need to consider your potential exposure to the other sides legal costs as it is likely your claim will be fast tracked.

 

If you total claim does not exceed the sum they are claiming and you believe the sum they are claiming is correct, then we need to consider making a part 36 offer to afford you some protection from costs.

[Parkvale]

Guido, I have just caught with this thread. Which has been extreemly traumatic for gandolfi to say the least., and your advice has been spot on. Well done.

[gandolfi]

If you total claim does not exceed the sum they are claiming and you believe the sum they are claiming is correct, they we need to consider making a part 36 offer to afford you some protection from costs.

 

Thanks Guido. Apologies for delay in responding.

 

I'm sure that my claim will be for quite a bit more than theirs once I've added the interest they have charged (as well as contractual interest). Could you explain what a Part 36 offer would be? Would it mean me agreeing to pay some of the debt to bring it under the 'fastrack' level? I do feel that if I am going to raise a counter-claim then I want it to be for all that they owe me, not just to clear the debt.

 

I'm still in the process of calculating the actual interest charged by the bank and the claimable proportion of that interest in relation to the running total of charges at each interest date. There are quite a few points in the account history when the total charges exceed the total borrowing, but most of the time it is more complicated than that. e.g. where the charges=£1700 and the borrowing=£3900 - meaning I can claim 43.6% of the interest charged by the bank at that point and add it to the running total.

 

Once I have calculated the charges and the proportion of interest related to those charges, I also want to calculate the contractual interest for my claim. My claim goes back beyond 6 years and I've been charged interest at various rates over that time (from 11.5% to 29.5%). However, for at least the last 6 years I have been charged an overdraft rate of 29.5% on what I now realise is an amount of debt that was caused by the bank's own charges in the first place.

 

In what would seem logical fairness, I'd like to make the contractual calculations at 29.5%, but this will make my claim very big indeed. But, looking through the build-up of charges it is very clear that I could've paid the deposit for my mortgage at least two years earlier and could have taken greater advantage of rising house prices in those years (my house almost doubled in value over three years). NatWest's charges deprived me of that opportunity.

 

The total amount should be far in excess of the money NatWest is claiming. So, I don't think an offer of part-payment would be appropriate. If this exposes me to potential costs, what could that mean?

 

I look at others' successes and see that I have been similarly deprived of my money. I'm determined to fight back now in exactly the same way.

 

To help me calculate the contractual interest.......Does anybody know what the mathematics are for working out interest at 29.5%/11.5%/9.5%? I think I'm right in saying that for 8% it is 'CHARGE x DAYS x 0.00022'. It would be great to know the figure for the other rates.

 

Unfortunately, I've never used Excel before, so am working on manual spreadsheets at the moment to work out the charges and interest incurred...once the basic figures are worked out I can try putting them into one of the spreadies on the site to calculate interest, but it would be good for me to make the manual calculations aswell if possible.

 

Thanks again all and best wishes!

[gandolfi]

Just to keep you up-to-date with the figures...

 

The business account has total charges of £6650, plus £9860 of interest that the bank have charged me (over £4000 of interest has been charged by the bank on my account since June 2005). Giving a total of £16,500 before either contractual/court interest is added.

 

I now need to find a way of organising the contractual rate of interest to add to this with my claim. They have been charging me 29.5%. Is it valid for me to do the same?

[GuidoT]

Part 36 offers are written offers that are made by, say a defendant and if that offer is not accepted by the other side and the judge decides that a sum payable that is lower than the offer, then the claimant bears the cost of the action.

 

By way of example, A is claiming again bank B. A is claiming £15K. B makes an offer of £9K prior to the hearing. The judge decides £10K is payable, therefore B bears the legal costs (his own and any of A's).

 

Say in this example, B makes an offer £11K, then A bears the legal costs.

 

One significant point to note if that if A accepts B's offer prior to the trial, then B bears all the legal costs incurred up to that point.

 

Anyway, I think we can put this to one side for now, as I mentioned this when I did not know how much you claim was for. It is now more important to get your counterclaim in. However, you still need to bear this mind as the entitlement to contractual interest has yet to be tested in court.

 

Regarding your calculations, just use the latest rate of interest.

 

As a lot of your claim is for interest therefore you need to make sure the calculations and basis is correct. It can be complicated, a lot of people make a pigs ear of it.

 

If you are having any difficulties then post up here and you will be helped.

 

This spreadsheet and thread should help you:

http://www.consumeractiongroup.co.uk/forum/general/51736-excel-contractual-interest-spreadsheet.html?highlight=interest+calculation+spreadsheet

[gandolfi]

I just wanted to check that my methods for calculating interest are correct. I have a couple of questions.

 

1) My first query is regarding the interest charged by the bank as a result of their charges. My method for calculating what is claimable is as follows:

 

If the running total of accumulated charges is £500 and the level of my overdraft for the period that the interest is taken is £1000, then I claim 50% of the interest charged for that period (let's say £20 of the £40 interest charged by the bank).

 

I then add that £20 to make a running total of £520 charges+interest.

 

On the next date that interest on the £1000 overdraft balance is applied to my account, I can claim a 52% proportion of the interest. As this accumulates the charges+interest eventually become greater than the overdraft debt, meaning that I claim 100% of the interest charged.

 

Is this correct?

 

2) My second query is regarding contractual interest. I intend to present 3 options to the judge at 29.5% (which they have been charging me for years), the loan rate of 9.5%, and the court interest at 8%.

 

It would be a big help if someone is able to let me know the correct maths for calculating these rates. I have prepared detailed manual spreadsheets (I am not Excel literate and am more confident with manually entering the calculations). I am assuming it is 'Charge x Number of days x ?????????'.

 

It would be a big help to know the correct equations for these calculations.

 

Thanks in advance!