Lloyds "Victory" - A View of the Judgement

[southyorksman]

A couple of questions

 

1) Under what UK law does a current account exist

 

2) What law governs bank overdrafts

 

A swift accurate response is required please

 

Ta,

 

IAN:???:

[dave]

It's such a shame; I was just about to give a slow, inaccurate response too ;-)

[southyorksman]

It's such a shame; I was just about to give a slow, inaccurate response too ;-)

OK, OK, I sometimes don't think enough before I write, I'm sorry.

 

I find that the best way to tackle a problem such as the banks' argument that they are providing a service is to get back to the underlying fundamental principles under which they are legally entitled to trade and then look at the subsequent controls that are legally placed upon them.

 

I'm not a solicitor but I have a pretty good brain and quite a lot of time free at the moment (no I'm not incarcerated).

 

What law actually governs bank current accounts, is it just the Supply of Goods and Services Act 1982?

 

What is the actual contract that was signed? Is it covered by the Consumer Credit Act 1974 and /or the Supply of Goods and Services Act 1982. I am vaguely aware that used to be Banking acts but I think these were replaced/repealed by the Financial Services Act but do these merely authorise banks without laying down rules for bank accounts.

 

What legally constitutes a services, is there a legal definition of what a service is and what act does it appear in?

 

I'm sorry if I'm posing basic questions but the answer is often "hidden" in plain view.

 

Any legal pointers welcome, sarcasm not helpful.

 

Thanks,

 

IAN

[dave]

Oh, come on. It's just a joke. If they make us lose our humour, then they have won!

 

No offence meant at all!

[sparklyd]

Guys, guys, guys, lets not squabble between ourselves!!

 

Its all part of the banks' evil plan, infighting leading to complete chaos, and before we know it, we've missed our court date and our claims have been thrown out!!

 

Remember, we're children of the revolution, not Lords of the Flies!!!

 

Sorry, just a little Friday Night humour!!!!

 

Well, my brain hurts and I for one need a little light relief!!!!

 

Sparkly

x

[Lord_Alcohol]

"Is it legal to charge interest on a service fee?"

 

It is a commercial service, not a Social Service. Debit interest is only charged if a service fee is not paid for. If a solicitor charges for his service at £190 per hour, and a barrister charges for his service at £3,000 per day, and if these fees are not paid within the time period agreed by contract, would it be illegal to charge interest due to late payment?

 

I understand Lloyds T&C completely disallows overdrafts on 3 types of accounts. Here I suggest no lender-borrower relationship exists, no lending service, no bad debt risk, no manual intervention, hence no justification for a service fee.

 

What an interesting thread! Mistermind, your postings are truly helpful.

 

The issue of service charge v penalty: when we are billed for a service by, for example, a solicitor, we have (a) agreed T&Cs beforehand, normally by accepting a 'pay-within' timescale clause (such as 28 days), and (b) have received an invoice giving us time to pay.

 

I understand that service providers are allowed to charge a modest rate of interest on late payment, but few do in my experience.

 

With the banks, however, the position is quite different. The 'service charge' is applied immediately with no warning and without any time to make adequate provision to remedy the situation; the 'service charge' can result in further 'service charges', such as unarranged borrowing fees; and a punitive rate of interest instantly kicks in.

 

I think that there is a world of difference between bank charges and service fees levied by service providers such as solicitors, and would love to see the banks show clearly that their charges are not penalties.

 

In my own case with NatWest, and it's probably the same with Lloyds, I have many letters regarding unpaid items which say "As dealing with unpaid standing orders or direct debits means extra administrative work I have charged a fee of .... blah blah". That looks to me like an application for liquidated damages and not the offer of a 'service'.

 

Maybe if the banks made these charges in the same way as other service providers, perhaps by invoicing or making the charge at the end of the following month and not immediately with no warning, then they might have a case: as it is, I do not think that they have a leg to stand on and we should all surge forward and take back what is rightfully ours.

 

LA

[Mistermind]

Most banks levy these charges same day, although a template Abbey letter was posted on this site making clear they give 7 days prenotification before debiting these adhoc charge items, as opposed to 14 days prenotification before debiting standard monthly account charges and debit interest. The rationale for the government bringing in Prenotification some years ago, was to enable customers to query or dispute errors.

 

A commercial service fee would normally attract VAT. Could anyone look up and clarify if banking services are VAT exempt?

[steven4064]

A commercial service fee would normally attract VAT. Could anyone look up and clarify if banking services are VAT exempt?

 

I looked on my statement for my business account and they certainly don't show any VAT on the breakdown of charges so I guess they are either exempt or zero rated.

 

Steven

 

If this post is helpful, please click the scales

[Mistermind]

Material on the subjects of after-the-event Penalty Charges,

before-the-event Service Fees,

VATable and non-VATable bankng service fees:

 

 

 

http://www.lloydstsb.com/rates_and_charges/private_banking_mayfair_charges.asp

Overdraft and other borrowing

We will advise you in writing and obtain your confirmation to all agreed borrowing facilities. This will cover the interest rate, how it is charged and what fees, if any, are payable. Changes in interest rates are advised through personal notification in writing and displaying a notice in the Mayfair banking office. For details of interest rates that apply when you borrow from us, please contact your Private Banking Manager.

If there is not enough money in your account to make a payment such as a direct debit, cheque or standing order we make a charge each time this happens. We recommend you discuss and agree your requirements in advance to avoid this charge and any unauthorised interest rates being applied.

Arrangement fees will be payable in some circumstances and agreed at the time of the advance.

We will always notify you personally at least 14 days in advance to tell you about any interest and charges you need to pay. We will also tell you on what date we will take the money from your current account.

Occasional administration fees

We’ll be happy to respond to the vast majority of your general banking requests and instructions at no extra cost. But if we need to spend a significant amount of time on a particular task for you, we may have to charge an administration fee.

We will discuss it with you in advance, and we will not go ahead without your specific prior agreement.

Most banking services are exempt from VAT at present. If this should change, we reserve the right to add VAT to these charges.

http://www.taxationweb.co.uk/forum/discuss.php?id=4641

 

VAT recovery on bank charges ?

17 Nov 2004 : dunkstar

My company has recently been incurring various bank charges e.g annual credit card subsciption, international transfer fees and interest. I don't seem to be able to dtermine whether these charges have VAT included in them and whether we are able to reclaim these from Customs. Any ideas greatly appreciated.

 

17 Nov 2004 : [email protected]

Bank fees for the handling of money or the provision of credit do not attract VAT. There is therefore no VAT to be reclaimed.

 

If the bank carries out any other services, such as financial or business advice, these may attract VAT.

 

Regards

 

Paul Taylor

httpw//www.vatease.co.uk/

 

http://www.consumeractiongroup.co.uk/forum/royal-bank-scotland/1031-unfair-charges.html

Hi,

I want to send a letter to the Bank of Scotland and have looked through the Library to find out which letter i should be sending out but im not sure which one is appropriate. I'll try and explain my situation as briefly as possible as it does not involve ovedrafts charges ,direct debits charges etc. Basically i signed a hire agreement which was financed by the Bank of Scotland and after my bank froze my account in error i had to make payments to he Bank of Scotland by credit card. Now in the small print on the back of the hire agreement i signed it states that any payments made by any means other than direct debit is subject to a charge of £35 + Vat which i find hard to believe and excessive. I would therefore like to claim the money back but dont know the letter i should be choosing so can you advise please.

thanks

Ratmin

[Welford]

Lloyds have just settled in full 10 days before going to Court.

 

I included a current T&C in my bundle but with a note that it was not relevant to the period of the claim and that Lloyds did not keep back copies. (All literature is distroyed by the branches when a revised or updated copy is received.)