NatWest not to be sued

#1
Just wanted to post this, as many are trying to squeeze the money from banks feeling hard done by:

BBC News said:
A bank customer has failed in his bid to force NatWest bank to justify its unauthorised overdraft charges.
Newly-qualified barrister Tom Brennan had asked the court for permission to sue the NatWest for damages, over what he claims are "unfair" bank charges.

Victory for Mr Brennan would have forced a bank, for the first time, to justify its fees in court.

However, City of London court turned Mr Brennan's application down and refused him the right to appeal the decision.

Allegations

Mr Brennan had alleged that the bank imposed overdraft charges knowing they were unjustifiably high and that in doing so it caused him economic harm by damaging his credit rating.

Mr Brennan has already had his overdraft charges of £2,548 repaid to him, and the bank has also offered him a further £1,600 to settle his claim, without an admission of any liability on its side.

But Mr Brennan was seeking to create a test case by claiming the right to sue, not on the direct grounds that his overdraft charges were too high, but for exemplary and aggravated damages to punish the bank's behaviour.

Barristers acting on behalf of NatWest argued that Mr Brennan's case was unsustainable in law and his arguments "bizarre".

Moved on

However, since the case was heard in May, events have moved on.

Last week, the Office of Fair Trading (OFT) came to an agreement with eight banks and building societies to take a charges test case to court.

The two sides - the banks and the OFT - will set out their arguments and a precedent-setting ruling will be made by the court.

The case is intended to bring clarity to the whole issue of fees for unauthorised overdrafts.
Here: http://news.bbc.co.uk/1/hi/business/6922430.stm

What stood out to me was that the bloke had already been refunded and offered extra, but yet still pushed ahead for more, to "punish" the bank. Also, for reference, the last line is highlighted. The banks, as shown here, have not been told that they are illegal charges, because at the moment they are not illegal.
 
#2
A bank customer has failed in his bid to force NatWest bank to justify its unauthorised overdraft charges.
Newly-qualified barrister Tom Brennan had asked the court for permission to sue the NatWest for damages, over what he claims are "unfair" bank charges.

Victory for Mr Brennan would have forced a bank, for the first time, to justify its fees in court.

However, City of London court turned Mr Brennan's application down and refused him the right to appeal the decision.

Allegations

Mr Brennan had alleged that the bank imposed overdraft charges knowing they were unjustifiably high and that in doing so it caused him economic harm by damaging his credit rating.

Mr Brennan has already had his overdraft charges of £2,548 repaid to him, and the bank has also offered him a further £1,600 to settle his claim, without an admission of any liability on its side.



My first thoughts to this are Greedy barsteward for trying to get more when he already had got a great deal in the first place. Secondly he is supposed to be in a responsible position as a barrister, how the fcuk has he racked up £2,548+ in bank charges. That must of been going onto 100 times he'd been overdrawn without reason.
 

Grownup_Rafbrat

LE
Book Reviewer
#3
And, being newly-qualified, he wouldn't be out to make a name for himself, ensuring lots of juicy fees for future work, would he?
 
#4
I often wonder when I read of these complaints about overdraft charges if the complainants actually read the conditions before they sign up. Obviously in this case he didn't and he's a barrister FFS. My other thought is , why don't people try to live within their income instead of trying to live on credit . There are debts that are unavoidable ,like mortgages etc, but to go into debt so you can have the latest madel car or take a sunshine holiday simply defeats me.
 
#5
Christ, I thought I was the only one who thought that people who complain bitterly about being charged for going beyond agreed overdrafts, demanding compensation etc. were being completely unreasonable! The bank does not hide these charges, it is made quite clear when you get an overdraft, "If you go beyond this, we will charge you." Come on! It's not hard, just don't make that extra purchase...
 
#6
Ha! get that you financial mongs. Because I keep my financial affairs in order I haven't paid any charges in 20 years and have been subsidised by the feckless and the stupid.

Long may it continue. You balloonheads who keep getting charged by your banks should stop complaining and sort your lives out.
 
#7
Quite agree - technically unauthorised overdraft is theft, as you are taking the banks money without their permission. I went overdrawn by mistake a while back and I was mortified and as soon as I found out I phoned the bank.
 
#8
It is all well and good saying don't do it and you knew they would charge you etc etc. The thing is that the bank charges way over the top for this "service" and it is not as if you can actually do without a bank account in todays society or avoid these charges by changeing banks as they all charge roughly the same.

This case seems to me to be about forceing the banks to justify charging £28 for a service that actually costs the bank £2.

No one is arguing that they shouldn't pay a fee for using this service but it is the sheer scale of the amount that is in question..

Apart from Government and drug dealers can you think of any other buisness that overcharges that much for something?
 
#9
Steven, why are you referring to it as a service? This is how it works:

If you're in credit, fine, you earn interest.

If you have an arranged overdraft of a £1000, then you can effectively borrow a £1000 of the banks money without being penalised (although you are then charged interest).

If you were to go beyond the agreed limit, then what you are doing is taking the banks money without permission.

If anyone does this, then it's entirely their own fault, and I have no issue with the banks charging them. i can't see it as being illegal, you sign papers agreeing to terms & conditions when you get the account. Just don't do it and you wouldn't have an issue with being charged.
 
#10
Goon in most cases I would agree with you but what the banks are doing is classed as an unfair penalty.

When a person opens a bank account or takes out a credit card they enter into a contract. Bank charges for going overdrawn or for bounced cheques are the equivalent of a charge for breach of contract, known as liquidated damages, and the courts can enforce payment. However the sum must reflect actual costs incurred and not exceed damages the bank suffered due to the breach of contract, otherwise it becomes a penalty, which is unenforceable by the courts.
 
#11
I understand that, Steven, but the crux of the issue at hand is that the Banks have yet to release any breakdown of costs for this.

Which means that they currently claim that it does reflect costs to themselves.
 
#12
The_Goon said:
I understand that, Steven, but the crux of the issue at hand is that the Banks have yet to release any breakdown of costs for this.

Which means that they currently claim that it does reflect costs to themselves.
Yes but that £2 of actual costs doesnt include the tea and biscuits they have whilst checking the overdrafts or christmas party beer fund. I agree that for the person who occassionaly goes overdrawn for an honest mistake that £20-£30 charge is unfair but if someones clocked up over £2000 in charges its classed as incompetance and they shouldnt be a barrister.
 
#13
[quote="The_IRON
Yes but that £2 of actual costs doesnt include the tea and biscuits they have whilst checking the overdrafts or christmas party beer fund. [/quote]

It's many years since Banks paid for Christmas Party Beer funds for their staff. At least the ones who do the work. Dunno about the ones in the fancy head offices in London!
 
#14
Grownup_Rafbrat said:
[quote="The_IRON
Yes but that £2 of actual costs doesnt include the tea and biscuits they have whilst checking the overdrafts or christmas party beer fund.
It's many years since Banks paid for Christmas Party Beer funds for their staff. At least the ones who do the work. Dunno about the ones in the fancy head offices in London![/quote]

Sorry thats who I meant I should of said sparkling wine but dont know if I can spell champagne correctly as Im a John Smiths drinker :wink:
 
#15
The_IRON, I'm in agreement with you, my point was that currently the banks are able to claim that their charges reflect their costs because no bank has released a cost breakdown. I have no problem with this.

And the banks don't pay for parties etc. It's bloody difficult to get the bank to stump up cash for a team meal once a year, let alone pay for a christmas party.
 

mysteron

LE
Book Reviewer
#16
Guys, the reason why they do not want you to see the breakdown in costs are just the same as any commercial business. If you saw it the competition would see what they are up to and find new and inventive ways to hide their costs to 'undercut' the competition.

The reality is that the fixed cost for dealing with someone that overdrawn by £1 or £1000. The variable cost is the interest charged against you for breach of contract, i.e. the liquidating costs. Unfortunately the vast majority of the proletariat are unable to comprehend this and then will demand a breakdown of costs.

They will then whinge as to why they are getting 'stealth' charged on something else - rather like the LiarBour Govt (and look where that got us!).

Banks are just a business and they have to make money too. They do that by charging those who can't keep their finaces in control. Normally they are the same as those who whinge about the costs!! It is unfortunate that those who fall on genuinely hard times are also punished - but life just ain't fair is it?
 
#17
"Which means that they currently claim that it does reflect costs to themselves. "

have been following this thread this afternoon. i went overdrawn when i changed jobs and my pay was seriously messed up by taxman taking more than he was entitled to.

the knock on effect from this was that i paid out in one month nearly 400 quid in charges due to things not getting paid.my bank would charge £28 for unpaid fee and £25 for refferal letter therefore £53 each time something wasnt paid.

i explained this to my bank but they wouldnt listen hence my decision to claim the money back which i did successfully. when i closed my account in the branch i told them that if they had listened and advised me at the time i wouldnt have took the money off them but basically fcuk them all. they arent having any xmas parties on my charges.
 
#18
Erm... Yes, Mysteron. I believe we're all in broad agreement with you, judging by the tone of previous posts!

Although you should be aware that banks are not actually allowed by law to charge penalty costs for going over agreed overdrafts, as has been stated. Although I'm aware that this is effectively what banks do.

The reason I mentioned cost breakdowns is because banks have not, and will try real hard in future to keep it this way, released any cost breakdowns because at present, and with current laws, they're unable to defend them.

I hope it remains like this for some time - the fools who have managed to get overdrawn repeatedly through their own mismanagement of funds are forcing the banks to shell out, and free banking in the UK may be on its last legs.
 
#19
The_Goon said:
Erm... Yes, Mysteron. I believe we're all in broad agreement with you, judging by the tone of previous posts!

Although you should be aware that banks are not actually allowed by law to charge penalty costs for going over agreed overdrafts, as has been stated. Although I'm aware that this is effectively what banks do.

The reason I mentioned cost breakdowns is because banks have not, and will try real hard in future to keep it this way, released any cost breakdowns because at present, and with current laws, they're unable to defend them.

I hope it remains like this for some time - the fools who have managed to get overdrawn repeatedly through their own mismanagement of funds are forcing the banks to shell out, and free banking in the UK may be on its last legs.
Free banking? Have you tried to get the bank to do something for beyond taking cash out a machine, like clearing a cheque in less than 6 days? or making a Bank transfer in less than 3 days? Replacement statements perhaps? Holding the deeds to your home? Bank Draft? The banks have and will rip you off every chance they get. I do hope you never have the slightest problem with your pay one day, and have every single Direct debit bounced, charges added, overdraft charges added, overdraft interest racked on, daily fees for being overdrawn.
 
#20
Well, I used to work for a Lloyds TSB, so yes, I'm pretty aware of charges etc. levied for bank services.

I suggest you visit almost any other country in the world. They will charge you for every single thing. The fact that you get a free service on cheques, can transfer money for free, amongst many other services that people in the UK take for granted should be something to be pleased about.

Out of interest, are you looking forward to the days when banks have to charge for every service?
 

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