Shoe Em v Abbey **WON**

[Shoe Em]

Hello to everyone!

 

This is my first day here; I've popped over from MSE & have spent the entire afternoon reading about my AQ. Really useful advice & templates, but as you will all recognise, my head is totally spinning

 

The stage we are at is this:

 

1.24th Jan 2007 Enquiry letter & statement request sent.

2.31st Jan 2007 Intention to reclaim charges sent & replied to with the usual investigation blah blah.

3.9th Feb 2007 Summary of charges & interest sent.

4.28th Feb Expressed intention to file with MCOL

5.Waited until time was up & then filed with MCOL.

 

Thus far we have received five different 'investigation conclusions' & two we are still looking into your complaints after these (so THAT's where our money goes!) all from different heads of different departments.

 

Now at the AQ stage & having carefully read the advice on the draft order for section G (N149) I feel confident to use it.

 

I'm going to read through as many Abbey threads as I can now, but to save me another two hours does anyone know if the new aggressive version (which seems to pertain to Lloyds) can be applied to Abbey because I love it!

 

Any advice or direction pointing greatly appreciated. Good luck to all:p

[jonni2bad]

You seem to be doing just what we would ask of you Em...

 

You have spent time reading, have followed the advice so far and are determined to see it through. Just stick to that same plan and we will see you on the other side of the finishing line - smiling, of course!

[Shoe Em]

Thank you so much for replying...I didn't even know if I'd posted in the right bit!

 

I have to go & fall over now as I've been wandering through forums all day, but if anyone knows where I can locate the Lincoln Abuse bit to add to my new shiny aggressive draft order I'd be extremely grateful.

 

Thanks guys,

 

Emily.

[Shoe Em]

Okay this one warranted a cheesy thumbs up, but I apologise for the retro gesture & won't be repeating unless truly necessary:)

(Like when we win!)

 

This morning I posted my AQ to Abbey & addressed it to the legal rep listed on their defence. We went for the grrr arrrg attack mode & have asked for the defence to be thrown out using Mullen vs Hackney & the Lincoln Abuse Order, & enclosed the draft directions found on here (thanks again guys!). This heads up is more to leave them quaking in their shiny Abbey boots rather than to make them settle, because at this point I am actually rather keen to see this through & so am not inclined to settle for a penny less than every penny they took from us.

 

*exhale*

 

We're filing with the court on monday when we actually have the money to pay the AQ fee. In the meantime I'm taking a day off to decompress & then I rather think a pre-emptive read through of the court bundle is in order so that we are prepared for war (& by that I mean of course amicable resolution...& by saying that I am of course lying!). It feels like this has been dragging for years & I long for it to be over, but we struggle on & at least here is a place to rant in good company:)

 

Good luck to one & all,

 

Emily x

[Shoe Em]

AQ went in yesterday & now it's a waiting game I guess. It would be incredibly helpful to hear from anyone else at the same stage...especially if you're claiming in Essex. Have read some useful threads about what to do in the event of The Phonecall da da da!!! Until then I feel a little thumb twiddly. Shall have a good old read of the court bundle on Thursday & be Brownie-style prepared, but I'm reluctant to sacrifice any more ink on the alter of Abbey until I know what their next move is to be.

 

As I've repeatedly gone for the pedantically replying to all their clearly standard letters approach, I suspect that we will not be going in the settle up quickly pile. Damn my spiteful nature, it never reaps rewards:p

 

(brings me oodles of happy though so I shall resist the urge to change:) )

[Shoe Em]

About to check online banking to see if there is a sneaky £3000 knocking around in my account...suspect not, so intend to follow my inevitable crushing disappointment with a tantrum:p

 

Don't suppose anyone has any cunning ploys to speed things along?

[JAMES33]

Hi Em - I am in a similar position to yourself - due to file my AQ tomorrow. You could try emailing the 'lovely' Inga Kirkman ([email protected]) and suggesting she might like to negotiate a settlement with you due to your directions being so 'aggressive' and as you know she won't turn up in court anyway. Probably won't get a reply but it might help your case in proving an abuse of process. I emailed her this morning but haven't received a reply yet but like I said it is all evidence against them! GOOD LUCK WITH YOUR CLAIM!!

[newbody]

hi shoe em I'm essex as well clacton region just ahead of you aq filed on the 30th april case been transferred to southend but thought let you know not the only essex member here

[Shoe Em]

James that is so useful...exactly what I needed. An E-mail can't do any harm & it will give me a lovely alternative outlet to vent:) Let me know how everything goes with you & very best of luck!

 

Emily x

[Shoe Em]

Newbody, I'm so chuffed to hear from another Essex person!

 

My case is at Chelmsford so we're fairly close; heres hoping the judges of Essex are feeling warm & fuzzy towards we poor victims of the big bad banks:p

 

Fingers crossed that all will be well for you & that I'll see you on here soon doing a (virtual) happy dance:)

[mickand]

Newbody, I'm so chuffed to hear from another Essex person!

 

My case is at Chelmsford so we're fairly close; heres hoping the judges of Essex are feeling warm & fuzzy towards we poor victims of the big bad banks:p

 

Fingers crossed that all will be well for you & that I'll see you on here soon doing a (virtual) happy dance:)

 

Hi my case has been tranderred from Basildon to Southend. I filed against Lloyds on 2nd April, no court date as of yet.

[Shoe Em]

Best of luck with it Mick! Can I be nosy & ask if the 2nd April was the date you first did the MCOL bit or when you filed your AQ? If it was first stage (still a little confused about all the stages!) when did you file your AQ & did you use the version with the draft directions? Would be so lovely to have some kind of a time line in my head so I know what kind of wait I can expect, it might stop the frustration gathering:p

 

Have you tried contacting Lloyds at this stage about settlement or are you keeping shtum & poker faced? My poker face keeps slipping but I'm hanging on in there!

[mickand]

I created my case on MCOL on 2nd April. Case was transferred from Northampton to Basildon without an AQ and then transferred again to Southend.

 

I have not been asked to fill out an AQ.

[Shoe Em]

That's interesting...does that mean you get away without paying the additional £100, or do they find a sneaky way to factor it in?

 

Please let me know how you get on Mick, fingers crossed for you!

[Shoe Em]

 

Losing the will to live/energy to do this. We have court date & have been assigned to small claims track...using my psychic powers I guesstimate that this means all the time sorting out the draft directions was pointless, but who knows since it hasn't been mentioned at all.

 

Have to sort out bundle by next week, total waste of paper, ink & postage to be frank as I'm sure Abbey are going to revert to the tried & tested last minute back out. Really have too much on my plate to be messed about by our scuzzy bank...beginning to wish all kinds of unhappy fates to befall them. I wonder if you can curse an entire institution? God I hope so!

[Shoe Em]

Okay here we go, going in search of the court bundle...printer primed & inked up

 

Anyone with any pointers please speak up! Have two days to get this ready & sling it to the court & the scabby ones.

 

If they settle after I have printed all this up I'm going to sue on behalf of the trees!!!

[Shoe Em]

Guido T, thank you so much for the bundle. I don't mean to be blond but when you say it is the New Strategy Order documentation do you mean that it is an alternative to the bundle?

 

Is it complete?

 

Are T&Cs my own figures & letters form the bank (Abbey)?

 

I'm having a little (lot of) trouble navigating this site & I keep losing my way. If you know of a good thread to take me through the steps would you please advise?

 

HUGE thanks!

[GuidoT]

I have read your thread, can you first of all post up the order (word for word) that tells you the court date and any other directions.

[Celicaman]

when is your court date and what is the date for ?

hearing ?

Directions hearing ?

its the name of the letter from the court advising you of the date you are requested to appear

 

CM

[Celicaman]

Hi Guidot, your ahead of me,

CM

[GuidoT]

Hi CM, only marginally though.

[Shoe Em]

It's a notice of allocation to the small claims court, to be heard in the Chelmsford County Court:

 

"Distict Judge xxxxxxxx has considered the statements of case & allocation questionaires filed & allocated the claim to the small claims track.

 

The hearing of the claim will take place at 10am on the 27th July 2007 at Chelmsford County Court, London House, New London Road, Chelmsford, Essex & should take no longer than one hour thirty minutes.

 

The court must be informed immediately if the case is settled by agreement before the hearing date.

 

Each party shall deliver to every other party & to the court office copies of all documents (including any experts' report) on which he intends to rely at the hearing no later than 14 days before the hearing.

 

The original documents shall be brought to the hearing.

 

Court must disregard documents if directions not complied with."

 

(Sorry that took time, had to type it all out)

[Shoe Em]

I have read Celicaman's advice & shall type out a statement accordingly, but if you have an example I'd be very grateful.

[GuidoT]

No need to type anything for now, there is a template statement here, read this slowly:

http://www.consumeractiongroup.co.uk/forum/guidance-notes/64911-got-court-date-guide.html

 

Post up any questions I will be around later this evening.

[Celicaman]

1st Witness Statement of ******


Exhibit 1
Date
In the ******** County Court
Claim Number:

Between:

(Claimant)

 

-And-

Name of Bank plc

(Defendant)

1st WITNESS STATEMENT OF

( your name)

1. I, the Claimant, am a litigant in person in this case.
   
2. I make this Witness Statement in support of my claim against the Defendant for the refund of penalty charges levied to my bank account by the Defendant bank.
   
3. I make this Witness Statement from information and facts within my own knowledge and which I believe to be true.
   
4. On (Date) I wrote to the Defendant, setting out the nature of my complaint and requesting that the Defendant refund the charges.
   
5. Upon unsatisfactory response from the Defendant, (date) I again wrote to the Defendant requesting a refund of said charges and advising I would file a claim should I not receive a satisfactory response.
   
6. Upon a further unsatisfactory response from the Defendant, (Date)I filed a claim at Northampton County Court for the return of the charges levied by the Defendant, as particularised and detailed in the Particulars of Claim.
   
7. The Defendant acknowledged service of the claim on (Date)
   
8. The Defendant filed its defence on (Date)
   
    
    
    
    
    
   Overview
   
9. I submit that the charges levied to my bank account, as set out in the enclosed schedule, are, notwithstanding the defence of the defendant, default penalty charges arising directly from my breaches of the contract between myself and the Defendant. As a contractual penalty, it is submitted that the charges are unenforceable by virtue of the Unfair Terms in Consumer Contracts Regulations 1999 ("UTCCR"), the Unfair Contracts (Terms) Act 1977 ("UCTA"), and the common law.
   
10. It is admitted that the Defendants charges were levied in accordance with the terms and conditions of the account in question. However, it is submitted that the Defendants charges are not related to or intended to represent any actual loss caused by the breach of contract, but instead unduly enrich the Defendant, which by virtue of the legislation and provisions cited in paragraph 9 above, exercises the contractual term in respect of such charges with a view to profit.
     
     
    Disguised Penalties and breach of contract
    
11. The Defendant avers that the charges levied are legitimate fixed price contractual services, not related to breach of contract, and therefore not required to be a pre-estimate of loss incurred on the part of the Defendant. I refute this interpretation and further submit that this contention is merely an attempt to 'cloak', or disguise, its penalties in order to circumvent the common law and statutory prohibition of default penalty charges with view to a profit.
    
12. I believe the definition of a 'service’ to be a provision of knowledge, skill or other transferable facility that benefits the consumer, and one which the consumer agrees is at a reasonable market rate commensurable with the service provided. I believe it to be inconceivable that the charges levied to my account by the Defendant could be any form of service', rather than a penalty. I did not want the Defendant to perform any services, I did not ask the Defendant to perform any services and I was not given any option as to whether the Defendant performed any purported "services" on my account.
    
13. I understand the definition of a breach of contract to be the failure of a party, without legal excuse, to perform an agreed obligation pursuant to any or all of the terms agreed within that contract. I have an overdraft with the defendant. This overdraft has a contractually agreed limit, which is an express term of the bank account contract between myself and the Defendant. The definition of the word "limit" given by the Oxford English Dictionary is as follows;
     
    • noun 1 a point beyond which something does not or may not pass. 2 a restriction on the size or amount of something. 3 the furthest extent of one’s endurance. • verb (limited, limiting) set or serve as a limit to.
     
    When I exceeded the contractually agreed overdraft limit, therefore breaching an express term of the contract between myself and the Defendant, I was consequentially penalised for each such breach by way of charges between of (enter minimum & Max amounts of the charges from summary Sheet)
    
14. The banks charges arise directly from the happening of an event. It is a clear requirement of the terms of the account contract that sufficient funds are available to cover payments made by standing order or direct debit, or overdraft drawings. A charge arises when these requirements are not met – I.e. when a payment or drawing is made from the account which is not supported by sufficient available funds.
    
15. If the Defendant’s interpretation were to prevail, it would be entirely conceivable that any supplier or contractual party in the future would be able to avoid the protection afforded by the law governing liquidated damages simply by describing the consequences of the relevant event as a payment for service rather than damages for breach. Such a result would seriously damage the interests of the consumer and destroy the body of common law on liquidated damages which has been built up over the last 100 years.
    
16. It is further submitted that the Defendant's contention that the charges are now a service charge represents a contradiction to materials published by the bank previously.
     
     
    Office of Fair Trading Analysis
    
17. I refer to the statement from the Office of Fair Trading (April 2006), who conducted a thorough investigation into default charges levied by the British financial industry. While the report primarily focused on Credit card issuers, the OFT stated in its overview that the principle of their findings would also apply to Bank account charges and indeed those of the entire financial and lending industry. They ruled that default charges at the current level were unfair within their interpretation of the UTCCR. With regard to the 'cloaking' or disguising of penalties, the OFT said this;
     
    "4.21.Disguised Penalties
    The analysis in this statement is in terms of explicit, transparent default fees. Attempts to restructure accounts in order to present events of default spuriously as additional services for which a charge may be made should be viewed as disguised penalties and equally open to challenge where grounds of unfairness exist. (For example, a charge for 'agreeing' or 'allowing’ a customer to exceed a credit limit is no different from a customers default in exceeding a credit limit.) The UTCCR's are concerned with the intentions and effects of terms, not just their mechanism".
    
18. Further, in April 2007 the OFT issued a report titled "Unfair Contracts Terms Guidance – Consultation on revised guidance for the Unfair Terms in Consumer Contracts Regulations 1999". Relevant sections from this report are quoted as follows;
     
    "Section 5.8 - Disguised penalties. Objections under the Regulations to an unfair financial penalty can apply to any term which requires excessive payment in the event of early termination, or for doing anything else that the supplier has an interest in deterring the consumer from doing. The Regulations are concerned with the intention and effects of terms, not just their mechanism. If a term has the effect of an unfair penalty, it will be regarded as such, and not as a 'core term'. Thus a penalty cannot be made fair by transforming it into provision requiring payment of a fee for exercising a contractual option."
     
    Section 18 1.3
    "These objections are less likely to arise if a term is specific as to what must be paid and in what circumstances. In that case, it may be considered a 'core' term and exempt from consideration for fairness provided it is in clear language and properly drawn to consumers' attention – see Part IV, paragraph 19.12. (But note that this may not hold good if it is a 'disguised penalty', that is, a term calculated to make consumers pay excessively for doing something that would normally be a breach of contract."
     
     
    Unfair Terms in Consumer Contracts Regulations 1999
    
19. In the absence of an express term of the account agreement prohibiting exceeding the limit of the overdraft facility and/or prohibiting the payments of standing orders and direct debits without sufficient funds, I will aver that there is a term implied to the same effect. Without such term the consumer would be afforded no protection whatsoever from the inequity between the bargaining powers of the parties, and it is an intended effect fundamental to the UTCCR and other consumer contract regulations to imply terms in order that such great imbalance in the rights of the parties is redressed to some extent.
    
20. Further, under the UTCCR:
     
    "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.
     
    (2) A term shall always be regarded as not having been individually negotiated where it has been drafted in advance and the consumer has therefore not been able to influence the substance of the term.
     
    (3) Notwithstanding that a specific term or certain aspects of it in a contract has been individually negotiated, these Regulations shall apply to the rest of a contract if an overall assessment of it indicates that it is a pre-formulated standard contract.
     
    (4) It shall be for any seller or supplier who claims that a term was individually negotiated to show that it was."
     
    Schedule 2 also includes such clauses (to define examples of unfair clauses) as:
     
    "(i) irrevocably binding the consumer to terms with which he had no real opportunity of becoming acquainted before the conclusion of the contract;
     
    (j) enabling the seller or supplier to alter the terms of the contract unilaterally without a valid reason which is specified in the contract;
     
    (m) giving the seller or supplier the right to determine whether the goods or services supplied are in conformity with the contract, or giving him the exclusive right to interpret any term of the contract."
    
21. The defendant is a multi-national corporation. The term regarding charges was inserted unilaterally in contract. The contract was pre and mass produced and I had no opportunity to negotiate the clause, or indeed any part of the contract.
    
22. The cost of (Banks name ) charges have increased substantially and indiscriminately during the time my account has been in operation, at no time was I ever given the opportunity to negotiate, or even notified of this increase. This means the bank, a powerful financial institution, has unilaterally altered the terms of my account contract to my detriment, and to their advantage.
    
23. I submit that it is wholly unfair that the defendant should hold such power in relation to the terms of the bank account contract relating to charges. The defendant, if its interpretation of its terms were to prevail, would have the unlimited power to increase the cost of its charges unregulated and without an assessment of fairness. The defendant and other UK banks would then be free to unilaterally alter the term and increase the cost of its charges to whatever it chose to unabated, with significant and highly detrimental consequences to the consumer and the intentions of the consumer regulations.
     
     
    Penalty Charges
    
24. If the court is persuaded that the charges were levied for breach of contract or that the penalty provisions are applicable irrespective of a finding of breach, it is the Claimant’s submission that the charges are indeed penalty clauses.
    
25. It is not disputed that the Defendant is entitled to recover its damages following my breaches of contract, and it is entitled to include a liquidated damages clause. I accept without reservation the banks right to recover its actual losses resulting from the breach or a genuine pre-estimate thereof. A penalty however, is unenforceable.
    
26. I will cite the case of Robinson v Harman [1848] 1 Exch 850, which states that a contractual party cannot profit from a breach and the charge for a loss suffered from a breach of contract should be the amount necessary to put both parties in the same position before the breach occurred.
    
27. Lord Dunedin in the case of Dunlop Pneumatic Tyre Co v New Garage & Motor Co [1915] AC 79 set down a number of principles in definition of a penalty clause. One of these principles being -
     
    "The sum is a penalty if it is greater than the greatest loss which could have been suffered from the breach"
    and;
    "The essence of a penalty is a payment of money stipulated as in-terrorem of the offending part"
    
28. I will further rely on numerous recorded authorities dating throughout the 20th century to the most recent case of Murray v Leisureplay [2005] EWCA Civ 963, all of which have upheld and reinforced the principles set down by Lord Dunedin defining contractual penalty clauses and the unenforceability thereof.
    
29. Further, under the UTCCR, schedule 2 (1) includes to define an example of an unfair clause as -
     
    "(e) requiring any consumer who fails to fulfil his obligation to pay a disproportionately high sum in compensation"
    
30. It is submitted that the charge is an unconscionable penalty as it is extravagant and exceeds any loss that the Defendant could have expected to have incurred as a result of the Claimant’s breach and seeks to deter the Claimant from breaching the contract.
    
31. The Defendant, or indeed any of the UK banks, has never published any information to support how their charges are calculated, or what their actual costs associated with such breaches are, or what revenue they derive from such charges.
    
32. For the recent BBC2 documentary "The Money Programme", the BBC appointed a commission of former senior banking industry figures and business academics to attempt to ascertain the actual costs to the UK banks of processing a customer's breach of contract. They concluded that the absolute maximum conceivable cost that could be incurred by a direct debit refusal or overdraft excess is £2.50, and of a returned cheque £4.50. They did state however, that the actual cost is likely to be much less than this. The commission also estimated that the UK banks collectively derive as much as £4.5 billion in profit a year from their charging regimes.
    
33. It is submitted that the Defendants charges are applied by an automated and computer driven process. This process consists of a computer system 'bouncing' the direct debit, and sending out a computer generated letter. It is therefore impossible to envisage how the Defendant can incur costs of £30 - £35 by carrying out this completely automated process. The letter received notifying the customer of a charge is identical in every instance, and if multiple breaches occurred on the same day, a separate letter will be sent in each instance.
    
34. On 22nd May 2006, the House of Commons passed an early day motion which welcomed the OFT's statement that default charges should be proportionate to the actual loss incurred. The house described such default charges as "exorbitant" and "excessive".
    
35. I will also cite a BBC radio interview in 2004 with Lloyds TSB's former head of personal banking, Peter McNamara, in which he states that revenue derived from bank charges are used to subsidise free banking for all personal customers as a whole.
     
     
    Supply of Goods and Services Act 1982
    
36. As submitted above, I believe the charges levied to my account to be disproportionate contractual penalties, arising directly as a result of clear and demonstrable breaches of express and/or implied terms of the account contract between myself and the Defendant. I vehemently refute the Defence's contention that they are legitimate contractual service charges.
    
37. However, and without prejudice to paragraph 18 above, in the event that the charges were accepted by this honourable court as being a fee for a contractual service, I will contend that that they are unreasonable under section 15 of the Supply of Goods and Services Act 1982.
    
38. If the charges are services, there must be a correlation between the service provided and the cost. The cost of HSBC’s charges has increased substantially and indiscriminately during the time the account has been in operation. Further, their have been numerous claims of this nature brought against the defendant in the last 12 months. In a significant proportion of these cases orders have been made obliging the disclosure of these costs and each time these orders are breached by the defendant. If the defendant avers its charges are reasonable within the meaning of section 15, I would contend that it is incumbent upon it to justify the price by producing evidence of its actual costs.
     
     
    Summary
    
39. As set out previously, it is submitted that The Defendant's charges can not be considered to be a service charge. They arise as a direct consequence of an event demonstrable as a breach of the account agreement between the parties. In arguing that they are a service charge, the defendant also effectively admits that its charges make profits. The Defendant seemingly contends that their charges are not subject to any assessment of fairness whatsoever. This implies they can alter the term of contract to set the charges at whatever level they like without limit or regulation - contrary to the intended effects of consumer legislation such as the UTCCR. Similarly, as set out above, the charges cannot be considered to be liquidated damages. They, by The Defendant's own admission, are not a pre-estimate of loss incurred as a result of the breach of contract. The charges are disproportionate, punitive, held "in-terrorem", and unduly and extravagantly enrich the Defendant. As such, they are disguised contractual penalties and unenforceable at law.
     
     
     
    
    
40. Statement of Truth
     
    I, the Claimant, believe the facts stated within this Witness Statement to be true.
     
     
     
    Signed:
    
     
     
    Dated: