Reclaim unfair bank charges


Reclaiming your bank charges - The current legal situation:


On 25 November 2009 The Supreme Court ruled in favour of the banks. The OFT has, as of 22 December, issued a statement in response to the judgment to say that they will not be pursuing their challenge against the banks regarding unauthorised bank charges. (A copy of the full Supreme Court Judgment can be downloaded here.)


At present there is only a small glimmer of hope for consumers regarding unfair bank charges when Lord Phillips of the Supreme Court said: "It may be open to the Office of Fair Trading to assess the charge under other criteria".


Read our latest news article for further information.


Background:


On 26 February 2009 the banks lost the 2nd round of the battle to get a fair deal on unfair bank charges so the Supreme Court's ruling has come as a complete shock to the banks as well as the OFT.


Four Judges in total said that the banks were wrong in the arguments they put forward against consumers. In their Judgment, the Court of Appeal said that an appeal to the House of Lords would be a waste of time. However the banks made an appeal and the test case ruled in favour of the banks.


In 2007 the Office of Fair Trading (OFT) commenced proceedings in the High Court for a declaration on the application of the law in respect of unauthorised overdraft charges. In April 2008 the High Court decided that consumer regulations do apply to the banks terms and conditions meaning that the charges, both historic and current are subject to "fairness" rules and are potentially unfair and excessive to consumers. This demolished a key argument the banks had used to resist claims by over-charged customers.


The banks appealed the High Court decision and that appeal was dismissed unanimously by the Court of Appeal. This decision at that point was a great victory for consumers and it was thought it would assist in obtaining redress for many thousands of bank customers.


However, the banks were then granted an appeal by the House of Lords. At the time of the test case consumer complaints concerning unfair overdraft charges were frozen whilst the case was heard and whilst the OFT decided if banking terms were actually unfair (eg two-part test case). The waiver on dealing with these claims was set to 27 January 2010.




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