Banks Win Overdraft Charges Case

1st December 2009
Banks Win Overdraft Charges Case image

Banks Win Overdraft Charges Case

The long awaited Judgment from The Supreme Court on Overdraft Charges of banks arrived on 25th November.  Unfortunately the Court ruled that the Office of Fair Trading (OFT) does not have the powers that it thought it had to scrutinise the fairness of bank charges.

In explaining his ruling, The Supreme Court’s President Lord Phillips said that bank customers agreed to pay overdraft charges as part of the price of having a current account, so they fell outside the scope of the protection of the 1999 Consumer Contract Regulations.

However the OFT has vowed to fight on despite its disappointment with the Judgment.  It is thought that the OFT could still try to scrutinise bank charges in other ways, perhaps by way of a full Competition Commission enquiry.

The OFT said that it would make another announcement in December and hopefully more will be known at that point as to whether or not the OFT will fight on with the cause for consumers.

Grant Shackleston commented on the ruling as follows:-

“This is obviously an extremely disappointing result for all the consumers who have been waiting a number of years to see whether or not their bank charges are unfair.  Although the banks have clearly won on this occasion, it has become clear that the banks have not been thinking enough about their customers.  Hopefully this case will concentrate the banks’ minds on the welfare of their customers and lead to a review or changes in their bank charges.”

The banks must now start processing all the complaints that had been put on hold for the past two and a half years whilst this Judgment was awaited.  The British Banker’s Association has said that the banks will deal with the complaints “in an orderly fashion”.

It has however thought that these claims are now at an end.  It is believed that the likely outcome of the stayed cases is that they will now be struck out and there will be no chance of a refund for the consumer.

Some consumers have been fortunate enough in obtaining refunds prior to this Judgment.  It is felt that these payments were likely to have been made as “goodwill gestures”.  If so this means that the consumer will be allowed to keep these repayments and will not need to repay the bank.

If you do go overdrawn without the permission of the bank then this ruling clearly shows that the bank can still charge you a fee and set the level of that fee.  Therefore a customer should negotiate in advance with a bank regarding an overdraft facility or an extension thereof.

If you require any advice in light of this ruling then please contact Daven Naghen.


Free Wills Month in October image

Free Wills Month in October

Maples are pleased to announce that they are taking part in Free Wills Month throughout October. If you are aged 55 or over you can make your Will for free and have the opportunity to help one or more of the sponsoring charities in the process. Appointments are limited in number and are allocated on a first come first served basis.

For further details please contact a member of our Wills and Probate Department:-

Jane Mawer- jane.mawer@maplessolicitors.com
Jamie Dobbs- jamie.dobbs@maplessolicitors.com
Faye Blair- faye.blair@maplessolcitors.com

Or telephone the office 01775 722261 and ask to speak with one of the team.

Read More

Testimonials

Gemma Mayer LLB

"I would highly recommend Maples Solicitors, especially Gemma Mayer, for any conveyancing work. The level of support and professionalism was excellent at all times. I also felt if I needed to ask or clarify anything that it was not an issue. Buying and selling a house is stressful enough, but Gemma helped me through it step by step."

Anita Toal LLB BA

"I think you are brilliant. You can use my comments above. You are efficient, friendly and quite clearly very good at what you do. Mainly you don’t leave people hanging around too long for." "So easy to talk to her and she understood what I wanted. She put me at ease and I cant thank her enough"

James Turner BA

James Turner was extremely helpful with our buying process. Everything went smoothly. We are very happy with the level of professionalism demonstrated by the office. Highly recommended solicitors. Will definitely do business with them again.

Daven Naghen LLB

"Daven provided an excellent service, from attending the first interview with me to the final court appearance. He filled me full of confidence that he would defend me to which he did and come out with an excellent outcome in view of my position that I had put myself in."

Faye Blair LLB

Faye was excellent, sensitive and acted very well to the time constraints we faced. Great service and dealt with compassion at such sad times made the process less painful very professional.

Jamie Dobbs ACILEx

Over the last forty years I have cause to deal with many law firms both in a personal and professional capacity, including some ‘top’ London Companies. In all of those dealings I have never found anyone as proactive and so willing to offer help and advice as Jamie Dobbs. During the last two years Jamie guided my parents through the completion of Lasting Powers of Attorney. Helped myself with the use of the LPA and recently dealing with Probate and Estate Administration following their death.

Mike Pepper MA

Mike Pepper gave us excellent advice. He was always most helpful and accommodating giving lucid explanations every step of the way. Thank you Mike.

Donna Sandison FCILEx

Donna has been helpful and professional every step of the way during the process. Always on hand to answer any queries and totally professional and friendly at all times.