The Phoenix v HSBC

[Spiceskull]

Following a previous claim against HSBC, and an attempt to obtain transaction history for the 6-years plus period, a couple of issues have been brought to my attention. I am now going to try to obtain ALL transaction history since my account was opened with the following:

Data Protection Act – full disclosure request

 

Dear Sir/Madam

 

Subsequent to my request of XXXX, and your response of XXXX, I am again requesting a complete list of my transaction history from the opening of my account in XXXX to XXXX. Your response to my previous request was:

You have requested details of the transactions on the above account for the period from

XXXX

back to when the account was opened in

XXXX

. As you have been advised previously, HSBC's policy is to retain such information for six years after which it is deleted. Therefore the earliest records which are currently held relate to transactions in

XXXX

, copy statements for which have been provided previously.

I now understand this to be a wilful misrepresentation of the truth, and an attempt to avoid providing me with the information that I am legally entitled to, and which you are legally obliged to provide.

 

I have today spoken with a member of the Service Quality Team, and have had it confirmed to me that whilst all notes against my account may well have been destroyed, transactional history is retained on microfiche indefinitely. This transaction history is what I initially requested, and I must now insist that it is provided to me at your earliest convenience.

 

Considering the nature of your response to my initial request, and confirmation that all other information had been deleted, it is reasonable to assume that this deletion is in fact a processing of my personal data. As such I would have expected details of this deletion to form a part of the notes against my account record, but no reference to this processing could be found.

 

As stated, my initial request was made on XXXX, with a legally enforceable 40-day deadline. As this has now expired I will extend a further 14 days to HSBC to provide me with the following information:

• Confirmation of the deletion of personal details and notes held against my account, along with the dates and methods of this processing
  
• A FULL transaction history of my account for the specified period (XXXX to XXXX)

Failure to provide this information, or a proper explanation for that failure, will result in a court action compelling you to provide the requested information. Furthermore, as I have already made this request as a Subject Access Request, subject to the Data Protection Act ( 1998 ), and submitted the requisite £10 maximum allowable fee, I shall not submit a further fee unless compelled to do so by the courts.

 

Yours faithfully,

The Phoenix

[Bookworm]

Well, you seem to know what you're doing. Of course, despite having some money back before (was it with our help?), this is, as I am sure you realise, a very different kettle of poisson...

 

Do let us know if you need help, a lot of people will be interested in this.

[Spiceskull]

Thanks.

[Spiceskull]

AQ submitted in response to HSBC defence - due tomorrow (Friday 15th):

The claimant requests that the court orders the defendant to provide a complete breakdown of how the defendant's penalty charges are calculated. The claimant believes that the applied penalty charges are unlawful, and therefore that the claimant had every right to amend the contract terms and to invoice the defendant for bringing errors to the attention of the defendant.

 

The claimant believes that the penalty charges are unlawful under contract law and also under the Unfair Terms in Consumer Contract Regulations 1999. The claimant also contends that the penalty charges demonstrate a wilful disregard for the directions provided by the Office of Fair Trading in their statement of April 5 2006, and also the subsequently provided directions.

[Bookworm]

Not bad. A bit arrogant, you're supposed to "respectfully" request...;-)

[Spiceskull]

Hadn't heard from the courts regarding AQ, so decided to pop in and see what the delay was. It seems that an allocation hearing is due tomorrow, and that they have written to me...twice...!!! Aaargh!

 

I moved a couple of months ago, and specifically made a note of this when I took the AQ in - it was even stapled to the front of the form. When the lady at the court saw this she was very embarrassed, especially as the hearing notification had been returned as "not known at this address" - not once, but twice.

 

So, I have a hearing tomorrow, with bugger all time to prepare myself. That in itself is maddening enough. The next problem is how the courts case management could screw up not once, but twice...that is beyond belief.

 

Finally I have a serious amount of anger to to deal with over the fact that the letters were returned as 'not known here.' I won't go into great detail, but this is the thing that pee's me off the most. A hearing that the bank wins by default would not be good for CAG...

 

...grrrrrrrrrrrr!!!!!!!! :x:x:x:x

[Guest bong]

phoenix good luck for tomorrow - I'm sure you'll be alright. Let us know how it goes.

[Spiceskull]

Deep breathing now - I am waiting to collect a letter that DG sent me this morning - it would appear that they are determined to attend, so let's see what happens...

 

I'm quite excited by it all...

[Spiceskull]

Hearing was two hours - good and bad in many different ways. Will write it up tonight, to put it into a sensible order, and will post tomorrow.

 

As an aside, I would appreciate details of the two cases that Citibank won in Northern Ireland recently. It seems that they provided a charges breakdown, and I would like to see that breakdown if anyone has it...

[Bookworm]

Lickthewallfatboy v City. Not aware of another one.

 

Egg won by default against Hannahl (sp?), cos she didn't attend.

[Spiceskull]

Patience - I have a lot of notes that I need to write out tonight...a full summary will be here tomorrow...I don't want to make any mistakes...

[Bookworm]

http://www.consumeractiongroup.co.uk/forum/egg/33246-has-egg-actually-turned.html (annalh's case)

[Bookworm]

http://www.consumeractiongroup.co.uk/forum/citicards/9085-citi-cards-request-repayment.html (That's LTWFB's thread)

[Spiceskull]

Egg were there today - and requested that the hearing take place in Salford (head office) - it seems that the finance director will give a breakdown of costs in evidence...but the claimant (in Kingston) resisted, and the judge agreed that Egg could do the travelling...

[Spiceskull]

My Allocation Hearing - 2006 10 25:

 

This was a very short notice affair, with me finding out about the hearing with less tha 24 hours notice. The gist of the claim is that I notified HSBC of an amendment to the terms of the contract, and that any further errors on their part (in applying unlawful penalty charges) would result in me raising an invoice for my time and trouble.

 

This happened, the invoices were raised, and HSBC signalled their intention not to pay. Court action was initiated at the end of July, a defence was filed, and an allocation questionnaire was completed on 14th September. In the intervening period I had moved residence, and a conspicuous cover note to this effect was lodged with the AQ.

 

The hearing date was set for 25 October, and a notification duly sent...to my old address, not once, but twice, after the initial notification was returned as "not known at this address." It was only out of curiosity (and a prompt from Bookworm) that I went to the court on 24th, to see how my claim was progressing, and that was when it all became apparent.

 

When I turned up it was clear that there were many allocation hearings scheduled for 14:00, and it was my intention to request an adjournment, to give myself time to prepare. This was reinforced when not one, but three legal bods turned up and put their name against my case - a barrister and two solicitors. In the end the usher and the judge decided that all cases would be heard in the same session, and this appeared to please all the legal representatives...one promptly said to the others "right, shall we have a brainstorming session to see how we can put a stop to all these claims..."

 

We all marched in, and the session began. Most of the other cases were pretty straightforward, with a timetable for a hearing proper being set out. A couple of the cases diverted from the norm, especially one that stuck in my mind. A father had managed a claim for his daughter for £1,500 against Barclays, which they had since settled. However, as the father was an Independent Financial Advisor, he had 'invoiced' the daughter £1,000 for 'time and research,' and it is this sum that they were trying to recover.

 

The judge directed that both parties resolve this outside, especially in light of the fact that the father had done this for other claimants in the past. It appeared that they were perpetrating a moneymaking scheme, and my own view was that this was pushing a boundary too far. However, I had some sympathy as the claim was similar to mine in principle.

 

My claim was last, and HSBCs barrister promptly outlined the case. To be fair he was clear and honest, and summed up the claim in three points:

 

Was my amendment to the Ts & Cs allowable and justified

Was my raising of invoices justified

The value of the invoices raised

 

He went straight to the first point, and dwelled on the point about the amendment being invalid. As I had notified the bank that further errors would result in me raising an invoice, and that they had 30 days to decline this amendment, the fact that they did not respond did not constitute acceptance of the amended term. Quoting "Felthouse v Bindley," he claimed that as such my amendment was invalid and 'trite.' He then proceded to say that if one party to a contract was able to unilaterally able to amend terms in this way then the banking industry in particular would be in trouble. For an amended term to be valid acceptance must be made.

 

The judge nodded, and I concede that this is a valid point, but if silence is not deemed acceptance, then every amendment made to the Ts & Cs by the bank is also invalid. Interest rates and other terms are amended regularly, and as such this 're-offer' of contract invalidates all previous contracts. However, the banks make these changes and we accept them in silence. In light of this I decided to look into the case a little deeper, and the principal of "acceptance by conduct" seems to be the norm for banks. Effectively if the bank amends the terms, and you continue doing business, then your conduct implies your acceptance of the amended term. This is especially so where a contract already exists.

 

This was unknown to me at the time, but is something to be considered when I respond to the bank, and decide whether to continue with the claim. My argument will be that as they continued applying charges to my account then their conduct implied acceptance of the amended term. Lesson number one!

 

The second point was whether or not I was justified in raising the invoices. The barrister seemed to shoot himself in the foot here, and I believe that the points from this round went to me. I explained that as a loarge and global organisation, with assets of tens of billions, the bank could reasonably be expected to not make simple mistakes such as applying unlawful charges. The barrister explained that the bank had refunded each and every charge that had been mistakenly applied to my account, and as such had corrected all the errors brought to their attention.

 

The judge made a point of the fact that I had complained about these errors on many occasions, and that it was not reasonable for me to bring errors to the bank's attention on a regular basis. The barrister accepted this with a nod, and whilst the bank admits no liability, the very fact that all errors had been refunded implied that errors had been made. Mention was made of the OFT directions on penalties many times throughout the session, and I believe that the banks realised that arguing the points would be a no-hoper.

 

The third point was the value of the invoices, and this was where the judge said to me that he thought my case might "go down the plughole." It is a valid point, and I let the judge give guidance. Much was made of the fact that whilst there may be a claim for postage, paper and other stationary, I would not be able to claim £75 for my time, as there was no material loss. Nods all round, and a realisation that this part of the claim would need to be amended if it was to succeed.

 

The upshot of the hearing was that HSBC and I would spend the next four weeks attempting to come to a mutually acceptable sum for my time in bringing errors to their attention. If this fails then the claim goes forward. It has been allocated to the small claims track, and I have permission to file and serve an amended claim by 22 November. The bank obviously has permission to file and serve an amended defence by 6 december, and both parties have permission to serve factual statements by 20 December.

 

After the hearing the barrister and solicitors told me that they would not be entertaining anything but a nominal sum, and that any oher amount would be defended in full. And that I would lose! (I thought it a bit presumptious that the bank's barrister already knew what the judge would decide in a hearing that had not yet actually been scheduled for hearing...!!!)

 

Giving thought to all of this last night, the two sticking points for me are the first and third. For the third I believe that an amended claim for three hours at the 'litigant in person' rate of £9.25 an hour should be successful. Whilst this is not for costs for attending court, it suggests that the rate is acceptable for 'your time.' In considering stationery and other elements, an invoice for £30 seems reasonable, and has parity with the charges applied by banks when correcting errors by the customer.

 

Regarding the validity of the amended term in the contract, the principle of 'acceptance by conduct' must be my focal point. If this is good enough for the bank when amendments are in their favour, then the principles of mutuality and reciprocity imply that the same rules apply in reverse. Indeed I mentioned this to the barrister, and argued that since my initial contract was with Midland Bank, and I have since accepted no subsequent amendments, then my silence must have been deemed as acceptance. In this the bank's argument must fail.

 

I also have to consider that there are two further outstanding invoices, and, claim aside, these need to be considered if the case is not to progess further. £30 an invoice, plus court costs should tuck this claim up nicely.

 

So, my next move is a letter to HSBC, amending the invoices to £30, and requesting a cheque for £120 plus costs. As a gesture of goodwill I will drop the claim for interest (which amounts to pennies.)

 

I would be keen to have discussion on the principle of "acceptance by conduct" before writing that letter...

[Spiceskull]

And here is their barrister - Daniel Toledano - Legal Week

[Spiceskull]

On another note - researching the amended contract issues. If an 'offer' of contract is made it is deemed accepted in its entirety. If an amendment to the 'offer' is made, the original 'offer' is declared void, and the amended 'offer' is now considered as a new offer.

 

In itself not a huge issue, but this needs to be considered when accepting settlement offers from the banks. If you strike out a confidentiality clause (or any other aspect of the offer) you are technically negating and invalidating the original offer.

 

It may be prudent to add to the offer instead. Something to the effect of "I don't accept that specific term, but I accept the original offer in its amended form as returned." It is important, therefore, to ensure that the bank accepts this amended offer, as technically they could claim that the original offer was not accepted...after all.

[Bookworm]

I don't see it as an issue, tbh. They would be shooting themselves in the foot if they tried that, as if the offer has not been accepted, then the court case against them continues... The whole point of them settling is that they don't want to go to court, so not to their advantage at all. Besides, we all know confidentiality is only them trying to get something for nothing, and that they won't push it if you refuse it. (my own case excepted, of course!!! But that was a blip, I'm sure.)

 

Having said that, I personally have never felt comfortable with just scratching out the part you don't like, I've always felt that defacing a document makes it invalid, and that the correct way about it is to write back saying you do not accept any conditions, etc... even if it adds a week before you get your money.

[stoppaRed]

The judge directed that both parties resolve this outside, especially in light of the fact that the father had done this for other claimants in the past. It appeared that they were perpetrating a moneymaking scheme, and my own view was that this was pushing a boundary too far. However, I had some sympathy as the claim was similar to mine in principle

Phoenix, were the charges from the bank in this case less than £1,000 and they claimed £1,000 over and above the actual charges to line the Dads' pocket or was the £1,000 part of the charges claim?

[Spiceskull]

I won't go into great detail about the claim itself, but the charges of £1,500 had already been refunded. This additional claim was a form of invoicing, apparently representing the effort and/or costs involved in having the errors rectified.

 

As can be seen by my own claim, a) the cost must be seen to be proportional (as I believe mine was) and b) the claim for these costs must have a direct bearing on the original claim itself.

 

I would go some way to agreeing with Barclays that as this had been done before, on behalf of other people that a) it constituted a business arrangement (that had not been agreed by Barclays) and b) as the 'fees' were the same in other cases then where was the additional research and effort for this particular claim.

 

That argument follows a similar line we take when making a proportional charge for the banks to recover their costs. It may cost a million to implement the IT systems, but no-one would expect each penalty charge to recover that cost on its own.

 

My personal view is that the claim is boundary pushing, and whilst I have no problem with the principle, the actual practice seems to have rebounded on them...

[Guest bong]

My argument will be that as they continued applying charges to my account then their conduct implied acceptance of the amended term.

 

Surely phoenix, it's not just that the bank continued applying charges to your account, it is that they carried on providing you with banking facilities and did not say they were terminating the contract as a result of the amendment?

[Spiceskull]

Surely phoenix, it's not just that the bank continued applying charges to your account, it is that they carried on providing you with banking facilities and did not say they were terminating the contract as a result of the amendment?

You have sort of hit the nail on the head, and this is the point that I am using in response to DG. Here is an amended version of my letter to them, outlining the relevant point:

Following the allocation hearing of 25 October, and the direction of the judge, I am writing in a final attempt to settle this claim before 22 November. Mr Toledano's opening statement to the court summarised the claim in three salient points, points that I am in agreement with:

• Was my amendment to the Ts & Cs allowable and justified
  
• Was my raising of invoices justified
  
• The value of the invoices raised

Point one is the subject that I realise will be the subject of discussion, and the point that will be argued in court should it proceed further. I thank Mr Toledano for raising the case of "Felthouse v Bindley," and I have now familiarised myself somewhat with the details of the case. In the first instance I would raise the following points:

• Between myself and HSBC there are no involved third parties (such as an auction house)
  
• Between myself and HSBC there already existed a contract
  
• Between myself and HSBC 28 days notice of amendment had already been given, and HSBC therefore had 28 days to either accept or decline

Notwithstanding the above points, Mr Toledano's assertion that the amendment amounted to a unilateral change in the contract is invalid. HSBC was invited to be party to the amendment, and declined to respond. However, in making the amendment I ensured that a reason for the amendment was given, and this was that should further errors be made in my account then the amendment would be implemented.

 

HSBC duly levied a penalty charge to my account, and in so doing indicated that the amendment was acceptable, a principle I understand to be "acceptance by conduct." I fully accept that a unilateral change to the contract is not allowable, but in continuing to do business under the contract terms the implication was such that the amended term was accepted, and therefore a bilateral amendment.

 

A precedent had already been established in the contract for the principle of "acceptance by conduct." On many occasions I have requested a copy of my original contract, to be told that the original contract and terms have been changed periodically, and that these changes have been notified to me. My continuation of banking with HSBC has been indication of my acceptance of the amendments, and the amendments have been duly applied. At no time have I indicated my acceptance of any of the amendments proposed, but my silence has implied acceptance by default.

 

Therefore I contest the submission that my assertion that silence constitutes acceptance is not 'trite law' but that the principle of "acceptance by conduct" is well established and accepted in the banking industry.

Let's see what happens when they receive that..."Mr Phoenix, you know that you will lose this case..." - right, bring it on then!

[Guest bong]

great letter. are you going to address point 3 at the same time or get this one through first?

[Spiceskull]

It was a three page letter - points two and three were also covered, but I only wanted to illustrate "acceptance by conduct" here. As for the other two points, when the claim has been settled (yes Mr Toledano, I WILL win!) then I will detail the rest here...

[Spiceskull]

Well, they were given an opportunity to settle in a 'timely fashion' and have chosen not to. So, I am just popping down to the court to resubmit my amended claim, as allowed by the judge...bring it on Mr Toledano...