Contractual Interest - Precedent - LOST

[monkey_uk]

Any advice for me guys...please?!

[brechiner]

I was in Edmonton County court today for a friend. We argued absolutely everything (M&R, Custom and usage, fiduciary arguments etc.) and didn't make any headway.

 

I have the following info:

 

Sempra case is NOT relevant for county court cases, NO bank charge case has been decided on in a higher Court than Small Claims so you cannot argue unjust enrichment because the Court needs a ruling either by the higher Court OR OFT/FSA on the legallity of charges. Compound interest is not allowed because of Halliday vs HBOS ruling. This info was given by DJ Cohen who was very helpful and refused to throw out the claim even though the claimant had filed completely the wrong info - mainly because Cobbett's sent a cheque for £1300. The claimant had wanted 29.5% but was only awarded 8% simple.

 

Only going to a higher court will you be able to get CI, charges ruling etc.

[GaryH]

Sempra case is NOT relevant for county court cases

So House of Lords decisions are not relevant in the County Court? Really? New one on me!

NO bank charge case has been decided on in a higher Court than Small Claims so you cannot argue unjust enrichment because the Court needs a ruling either by the higher Court OR OFT/FSA on the legallity of charges.

Its difficult to argue in isolation but if you kept the claim intact and got a judgement in your favour on the issue of the charges, then theres nothing stopping any court awarding compound interest on top under unjust enrichment - in fact one would quite easily follow the other if it was argued properly. If the charges are settled then you would need the court to agree to proceed on the assupmtion that the charges were found unlawful.

 

Incidentally, the OFT/FSA have no power to establish law.

Compound interest is not allowed because of Halliday vs HBOS ruling.

Not true. Halliday HBOS ruled primarily on the issue of implied terms - specifically whether a term could be implied on the basis of fairness. It has no bearing whatsoever on the award of compound interest in general or on any other basis.

Only going to a higher court will you be able to get CI, charges ruling etc.

Nope. There is nothing stopping any court awarding compound interest under unjust enrichment since Sempra.

 

Nobody is saying its easy and as I posted above there are still areas where the argument could fall down, but if the Claimant makes a properly constructed case for it then its within the courts jurisdiction to award compound interest under unjust enrichment - whether small claims, High Court, whatever.

[steven4064]

Its difficult to argue in isolation but if you kept the claim intact and got a judgement in your favour on the issue of the charges, then theres nothing stopping any court awarding compound interest on top under unjust enrichment - in fact one would quite easily follow the other if it was argued properly. If the charges are settled then you would need the court to agree to proceed on the assupmtion that the charges were found unlawful.

The Sempra case involved only the payment of interest - the principas waspaid before the case wa brought.

 

Para 238 of Sempra - "....I cannot think that Lord Goff and Lord Wolf would have declined to extend the equitable power to award compound interest to a situation like the present merely because the principal sum was recouped before action brought. It is true that such an extension involves recognising an independent equitable claim to recover interest. But the restitutionary inpulse that the [Applellamts] should relinquish any monetary benefit actually received is a strong incentive to extend equity's reach to such cases"

[GaryH]

But the money in Sempra was accepted to have been paid wrongfully - or mistakenly, anyway. The point is that if there is no judgement on the charges then there can be no assertion that the enrichment enjoyed by the bank is unjust. The charges as they stand at present are not actually unlawful, just presumed to be.

[brechiner]

I really did argue unjust enrichment but the DJ asked me for a case heard in a higher court where bank charges had been ruled as an unjust enrichment. I couldn't give him an answer.

 

He said he is governed by the 1984 County Courts Act and cannot award Contractual Interest or 8% compounded. I argued that the Halliday case was an abuse of Court process because HBOS settled the charges but didn't settle the CI but he just said again that he was bound by the ruling of the High Court and that there was no ruling on the charges. He said we had won the 'moral' argument though

 

I have another case very soon so I will just not take NO for an answer and still clearly put across those points again.

 

Maybe we can find out the most pro-claimant District Judges in the UK.

[steven4064]

Gary

 

Would it be possible to appeal like dad did?

[GaryH]

Presume so, although I'm not sure it'd be wise tbh.

I really did argue unjust enrichment

How exactly, if you don't mind me asking? Have you got a witness statement, or a skeleton argument you could show us?

[wednesday1867]

Can someone answer a question i just posted on my thread http://www.consumeractiongroup.co.uk/forum/mbna/104386-mbna-no-cca-gimme-3.html

 

Am i right in thinking it will help my case? Or am i not looking at the big picture of the whole document

 

Thanks

[elsinore]

Its difficult to argue in isolation but if you kept the claim intact and got a judgement in your favour on the issue of the charges, then theres nothing stopping any court awarding compound interest on top under unjust enrichment - in fact one would quite easily follow the other if it was argued properly. If the charges are settled then you would need the court to agree to proceed on the assupmtion that the charges were found unlawful.

Gary, re phrase in bold. Do you mean after a hearing with the bank defending, or by default (or either)?

 

Otherwise, that’s exactly the line I propose to take with my next claim. The claim will be for charges + costs + compound interest. Any offer of charges + 8% will be declined. As I no longer deal with the bank in question, they will be unable to dump money into my account and tell the court they have settled. It will be a case of ‘who blinks first’. The bank will either have to settle in full (or make me an offer that I would be an idiot to refuse), or go to court and argue charges. There is now enough evidence around to suggest that the bank would not go to court, but the claim would have to be prepared on the basis that they would, with all the current reasoning and arguments.

 

As the amount to be claimed is substantial, the claim is likely to be listed in a higher court, so there would be cost implications if I were to lose.

 

I would very much welcome some advice on this, even if only to tell me I’m a chump.

 

If the response is encouraging I’ll continue in my own thread.

 

Els

[monkey_uk]

I'm still struggling to decide what to do with my case.

 

To remind you, Hfx have dumped money into my account to the tune of charges + 8% + £120 court fee. I was claiming CI @ 28.8% APR (their unauthorised borrowing rate). They've not entered a defence, though have filed ack on MCOL. The deadline was today, though I believe with it being the weekend, that becomes monday.

 

I badly want to screw them for the CI, but not sure whether it is wise to try.

 

My PoC stated I'm claiming contractual interest on the basis of M&R AND unjust enrichment.

 

I'm tempted to enter a default judgement, but unsure.

 

Anyt advice would be greatly appreciated.

 

FWIW, they've not even dumped ANYTHING into my account for my Visa charges claim, so I'm deffo defaulting them for that as soon as MCOL lets me!

[NitrousOxide]

Hi,

Can someone explain what the lost case means now? Can we still claim contractual interest?

[jubaxt]

is really is hard knowing what to do monkey-i'm in the same situation

[TANZARELLI]

Hi,

Can someone explain what the lost case means now? Can we still claim contractual interest?

 

Now that the precedent has been set for CI claims using the Mutuality & Reciprocity arguement, it means that you cannot claim CI if you use this.

 

Their is a possiblility for using other approaches such as in Equity putting the Bank to Account for Profit. This needs to be researched well in advance and not rushed into or we could end up with the same situation as the other arguement.

 

People should not just add this to their POCs as a way of getting extra money prior to understanding it fully first and also be preparred to argue it fully in court.

 

JMHO

 

It woulod be an idea to have a closed forum to discuss this area first before people start to rush in. It would also not allow the banks to see our strategy.

 

Tanz

[chezt]

Now that the precedent has been set for CI claims using the Mutuality & Reciprocity arguement, it means that you cannot claim CI if you use this.

What's the advice if you already have then ... ie already included in POC's where you have already filed .... I guess it's too late but should you continue & wait & see what happens?

 

It woulod be an idea to have a closed forum to discuss this area first before people start to rush in. It would also not allow the banks to see our strategy.

 

Tanz

 

That's been suggested on here before but I'm not sure a full answer/decision was given ... I'm sure I read that some things are being discussed behind the doors but can't remember the fully story ... perhaps a mod can clarify this?

 

Deffo a good idea tho !

[GaryH]

Hi Els,

Gary, re phrase in bold. Do you mean after a hearing with the bank defending, or by default (or either)?

It would have to be a judgement following a hearing - default judgements don't approve or even consider the merits of a claim one way or another. Apparently default judgements are not even granted by judges nowadays, just processed by court clerks.

Otherwise, that’s exactly the line I propose to take with my next claim. The claim will be for charges + costs + compound interest. Any offer of charges + 8% will be declined. As I no longer deal with the bank in question, they will be unable to dump money into my account and tell the court they have settled. It will be a case of ‘who blinks first’. The bank will either have to settle in full (or make me an offer that I would be an idiot to refuse), or go to court and argue charges. There is now enough evidence around to suggest that the bank would not go to court, but the claim would have to be prepared on the basis that they would, with all the current reasoning and arguments.

 

As the amount to be claimed is substantial, the claim is likely to be listed in a higher court, so there would be cost implications if I were to lose.

 

I would very much welcome some advice on this, even if only to tell me I’m a chump.

 

If the response is encouraging I’ll continue in my own thread.

 

Els

I'm a bit reluctant to advise anyone either way really (sorry if thats a bit of a cop-out!), but IMHO a properly pleaded (and subsequantly properly argued), fully understood and well thought through claim for compound interest under unjust enrichment would have an excellent chance of success. Have to stress again though, thats just my unqualified opinion. Mind you, at the very least I don't think there can now be any doubt at all that such a claim would be entirely valid, legally and morally also IMHO.

 

How easy it is to demonstrate unjust enrichment would to a certain extent depend on the individual circumstances of each particular case, I think. For instance Pen's claim - she was forced to take out a loan to refinance the charges, so the bank were enriched not only by having use of the wrongfully levied charges, but moreover they were again enriched directly at her expense by way of her paying them compounded interest on the loan. Therefore if the charges are unlawful they were paid by mistake and the enrichment is unjust, then the court can now grant a remedy which provides full restitution - I.e compound interest. Before Sempra the court could not. (unless a breach of fid duty occurred)

 

If its a business claim and if the claim is of higher value then based upon my (layman's) interpretation of Sempra, theoretically at leastyou'd be much more likely to get awarded compound interest than a consumer claim of low value. On the flip-side to that though and as you've already identified, the size of the claim means a costs risk.

 

Which bank is it, btw?

 

I'm still struggling to decide what to do with my case.

 

To remind you, Hfx have dumped money into my account to the tune of charges + 8% + £120 court fee. I was claiming CI @ 28.8% APR (their unauthorised borrowing rate). They've not entered a defence, though have filed ack on MCOL. The deadline was today, though I believe with it being the weekend, that becomes monday.

 

I badly want to screw them for the CI, but not sure whether it is wise to try.

 

My PoC stated I'm claiming contractual interest on the basis of M&R AND unjust enrichment.

 

I'm tempted to enter a default judgement, but unsure.

 

Anyt advice would be greatly appreciated.

 

FWIW, they've not even dumped ANYTHING into my account for my Visa charges claim, so I'm deffo defaulting them for that as soon as MCOL lets me!

I'm not sure there's much to add to whats already been posted tbh. Only you can make the decision. If you want my opinion though then you should settle for what you've been paid. Particularly bearing in mind that its Halifax who are highly likely to defend it, and you've accepted an offer of the charges, and your claiming the 29.9% higher rate, and its based in part at least on M&R, personally I think your chances of success are low.

 

Hi,

Can someone explain what the lost case means now? Can we still claim contractual interest?

In a word, no.

 

There is the possibility of claiming compound interest, at the authorised contractual rate perhaps, but IMHO the emphasis should now come away from the word "contractual". The basis of a claim for compound interest would have nothing to do with your account contract.

 

Aside from that, and even though the recent Sempra virdict has clearly opened up a route to claiming compound interest, for the most part I would still say its not generally advisable at the present time. JMHO, of course.

[elsinore]

If its a business claim and if the claim is of higher value then based upon my (layman's) interpretation of Sempra, theoretically at leastyou'd be much more likely to get awarded compound interest than a consumer claim of low value. On the flip-side to that though and as you've already identified, the size of the claim means a costs risk.

 

Which bank is it, btw?

 

Thanks for the response Gary.

 

Yes, it is a business claim and guess what, it's LTSB!

 

I'll do some reading, thinking and chin scratching.

 

Els

[Pen]

:D Not The dreaded LTSB,

 

Els, you are a glutton for punishment :D

[TANZARELLI]

What's the advice if you already have then ... ie already included in POC's where you have already filed .... I guess it's too late but should you continue & wait & see what happens?

 

I think if it was me I would amend my POC using the N244 and paying the non refundable fee. I think it ccould be left but chances are defendants will mention the precendent in defences and judges would dismiss this part of a claim.

Really this would depend on the stage of your claim as if you had a court date set and it was fast approaching then it may in fact be a little to late to make the neccessary changes prior to the hearing. JMHO others may have a different view.

 

 

 

That's been suggested on here before but I'm not sure a full answer/decision was given ... I'm sure I read that some things are being discussed behind the doors but can't remember the fully story ... perhaps a mod can clarify this?

 

Perhaps the MODs may want to revisit this or give us a full answer.

 

Deffo a good idea tho !

 

If it is being discussed behind closed doors then perhaps the mods might like to inform members before they rush into this without fully understanding the arguements, which was what we saw with CI.

[Capitulator]

Please, please forgive me me if, once again, I'm barking up the wrong waterhole here but regarding brechiner's post....

 

I really did argue unjust enrichment but the DJ asked me for a case heard in a higher court where bank charges had been ruled as an unjust enrichment.

 

Could it not be argued that whether the bank charges themselves are unjust enrichment is not particularly the issue here as the banks have been settling the charges regardless, it is the interest the bank are likely to have been earning on these charges for which the unjust enrichment applies in this particular instance which is what we are claiming back ? Or is it all interconnected in that if the charges are not unjust enrichment then the interest earnt is also not unust etc. so can't be paid back, but if the banks have been paying back the charges then surely they should be paying back the interest earnt on those charges as well ?

 

Or maybe I should just sit in a corner and be quiet ?!

 

I only ask because I am just about to send of a request letter to Cap1 and I really don't know whether to put the CI on there anyway ?

 

Once again, thanks to all CAGgers (but esp. the clever ones:wink: ) for your omniscience !

[Capitulator]

BTW. I also agree with TANZ and chezt but am worried if it does become a closed discussion I wouldn't get a look in ! (which, for some, might not seem such a bad idea !

)

[TANZARELLI]

BTW. I also agree with TANZ and chezt but am worried if it does become a closed discussion I wouldn't get a look in ! (which, for some, might not seem such a bad idea !

)

 

Wanting a piece of the pie is not a bad thing, however anybody considering it should be fully aware of the arguements, case law, counter arguements and be preparred to argue it in the court. If not then it could simply do more harm than good.

 

The idea of a closed forum area would be to get a course of action ready for use away from the prying eyes of the banks (who we all know read this type of forum).

[cala99]

Dear ***********

I reiterate the points outlined in my email below and confirm that your proposed claim for interest at a rate of 29.69% is entirely without merit. I set out below the Bank's position. Quite simply:

• there is no express term in the banking contract between the parties that entitles the Claimant to charge the Defendant interest at 29.69% per annum (or at any rate) on sums which might otherwise be due to the Claimant from the Defendant; and

  
  

• nor is there any basis upon which to imply or otherwise "impose" such a term into the contract between the parties. It is trite law that a term will not be implied into the contract simply because it is "reasonable" or "fair" to do so but only because it is necessary to give business efficacy to the contract. In the present case, it is plainly not necessary for such a term to be implied. See also the recent decision of Underhill J in Halliday v HBoS PLC [2007] All ER (D) 66 (Jun) (QBD) to similar effect.

  
  

I reiterate my request for a schedule detailing interest at 8% and confirm that should you choose to pursue your claim for contractual interest at a rate of 29.69%, we reserve the right to apply to the Court for an Order striking out this part of the Claimant's claim and we shall refer to this correspondence on the issue of our costs.

 

Kind regards

 

Hi - That's the letter i received today! so basically saying its a no go on fair & reasonable /mutuality and reciprocity! I was hoping they wouldn't realize! In any case -any ideas on what I should respond? I mean in terms of CI - is there another argument I should put forward now? Plus I just received a court date today for november...should i mention?

 

thanks for any possible help!!!

[GaryH]

You need to accept the offer of charges + 8%.

 

Unfortunately everything in their e-mail is entirely correct. You won't get CI under mutuality and reciprocity (or fairness, balance, UTCCR, whatever) and certainly not now since the Halliday judgement. If you pursue it then you run the risk of costs being awarded against you.

[cala99]

thanks for the response gary - and if i attempt to then argue unfair enrichment? or would it still be your advice at this point to take the 8%?