Hello folks, Well, don't know where to start really. On going to court today I was quite excited as it seemed like we had come to the end of a very long road. We had to wait around for ages but was finally asked to go through to see the judge. There was a young chap representing HSBC in the room with us and he gave the judge one A4 piece of paper which was their application to stay. The judget proceeded to tell us that we were very well informed and organised and praised our court bundle as one of the best he's seen amongst all others they deal with at the moment. As they appear to be seeing around 10-15 claims against the bank per day I'm sure he's seen plenty. The credit for the bundle will have to go to you guys on this site as without your help I would never have got this far. The outcome of today is that in spite of our superb bundle he granted the stay on the grounds that he could carry on the hearing today and we could loose, and he felt it was fairer for us to wait for the outcome of the OFT case next year. I am disappointed with the outcome but also feel strangely philosophical about it all. Thanks for your help again and if anybody needs help with their court bundle etc I'm happy to help. Cx

Bless you all. Will post the outcome tonight. Am a bit nervous as although its still going ahead I've been told that the judge could grant DG a stay at this late hour so I'm mindful that it may not be all positive. Still, have read through my SOE and skim read the bumpf, got my suit out and off I go. Cx

Hi Folks, Latest update is that I'm due to go to court tomorrow. Any hints and tips for the court visit? Cx

Hi Jo, Yes I spotted it thank you. I've had the best nights sleep in a very long while, so I've obviously been worrying about things. I'll keep this thread updated with any come back from the letter I dropped in court about DG's application for a stay, the imminent court case etc. Cx:)

Just wanted to say a big thank you Thank You to all of you who have helped me to get this far! I've just finished referencing all the pages in the courtbundle and I'm off to copy it tomorrow! Without your help I think I would have given up ages ago as not only do you inspire confidence but the help I've received on here has enabled me to not only learn but to go through each step to get to this point. Cx

Jo did a fab proof reading and rewording on one of the paragraphs and I'm really pleased with it now. Feel confident again. Jo......you deserve a case of wine, never mind a bottle! a million thanks Cx

Statement of Evidence 1. The Claimant has an account xxxxxxx with the Defendant which was opened on 05 January 1996. 2. During the period in which the Account has been operating the Defendant debited numerous charges to the Account in respect of purported breaches of contract on the part of the Claimant. 3. A list of the charges applied is attached to these particulars of claim. 4. The Claimant submits that the charges levied to his bank account, as set out in the attached schedule, are, notwithstanding the contention of the defendant, penalty charges arising from and relating directly to breaches of contract on the part of the claimant. As a contractual penalty, the charges are unenforceable by virtue of the Unfair Terms in Consumer Contracts Regulations 1999, the Unfair Contracts (Terms) Act 1977, and the common law. 5. It is admitted that the Defendants charges were levied in accordance with the terms and conditions of the account in question. However, it is submitted that the Defendants charges are not related to or intended to represent any actual loss arising from a breach of contract, but instead unduly enrich the Defendant which, by virtue of the legislation cited in paragraph 4 above, exercises the contractual term in respect of such charges with a view to profit. 6. The Defendant avers that the charges levied are legitimate fixed price contractual services, unrelated to breaches of contract, which are therefore not required to be a pre-estimate of loss incurred on the part of the defendant. The Claimant further submits that this contention is merely an attempt to ‘cloak’, or disguise, their penalties in order to circumvent the common law and statutory prohibition of default penalty charges with view to a profit. 7. The Claimant believes the definition of a 'service' to be a provision of knowledge, skill or other transferable facility that benefits the consumer, and one that the consumer agrees is at a reasonable market rate commensurable with the service provided. The Claimant believes it to be inconceivable that the charges levied to his account by the defendant could be any form of ‘service’, rather than a penalty. 8. I understand the definition of 'breach of contract' to be the failure of a party, without legal excuse, to perform a contractually agreed obligation pursuant to any or all of the terms agreed within that contract. When I have had anoverdraft with the defendant,the overdraft had a contractually agreed limit, which is an express term of the bank account contract between myself and the Defendant. When I exceeded this agreed overdraft limit, therefore breaching an express term of the contract between myself and the Defendant, I was consequentially penalised for each such breach by way of a charge of £10-£125. Furthermore, on bank statement 158, it is evident how the automatic charge applied to the account for bouncing a cheque due to insufficient funds creates an overdraft on the account which in turn bounces the same cheque 4 times over a few days and every time applying a £30 charge on the account for doing so, thus making the overdraft bigger. This particular time, I complained to the bank and the 5 charges in question were refunded. As shown on bank statement 158 (page ref: xx), it is clearly evident how an automated charge applied to this account, for returning a cheque due to insufficient funds, creates an overdraft on the account. Due to the account being over the specified overdraft limit, further items were returned over the next few days, all incurring a £30 charge on the account, which in turn increases the unauthorised overdraft even further. Please note that on this particular occasion, the Claimant complained to the bank and the 5 charges in question were refunded. 9. In the case of Dunlop Pneumatic Tyre Co v New Garage & Motor Co [1915] AC 79, Lord Dunedin stated that a clause is a penalty if it provides for; "The essence of a penalty is a payment of money stipulated as in-terrorem of the offending part;” I.e. if it is designed to scare or coerce or is used as a threat. It is submitted that the charges applied are not representative of any 'service' provided by the Defendant, but instead are punitive, and held "in-terrorem". 10. The Claimant further submits that the Defendant’s contention that the charges are now a legitimate service charge represents a contradiction to materials published by the bank previously. 11. Additionally, the claimant believes there to be a high possibility that the terms and conditions of his account contract explicitly describe the charges as to be levied in instances of breaching those terms. This is true of the contracts of other customers of the defendant that the claimant is aware. 12. The Claimant refers to the statement from the Office of Fair Trading (April 2006), who conducted a thorough investigation into default charges levied by the British financial industry. While the report primarily focused on Credit card issuers, the OFT stated that the principle of their findings would also apply to Bank account charges. They ruled that default charges at the current level were unfair within their interpretation of the Unfair Terms in Consumer Contracts Regulations 1999. With regard to the ‘cloaking’ or disguising of penalties, the OFT said this; “4.21 The analysis in this statement is in terms of explicit, transparent default fees. Attempts to restructure accounts in order to present events of default spuriously as additional services for which a charge may be made should be viewed as disguised penalties and equally open to challenge where grounds of unfairness exist. (For example, a charge for ‘agreeing’ or ‘allowing’ a customer to exceed a credit limit is no different from a customers default in exceeding a credit limit.) The UTCCR’s are concerned with the intentions and effects of terms, not just their mechanism”. 13. As submitted above, the Claimant believes the charges levied to his account to be disproportionate contractual penalties, arising from clear and demonstrable breaches of express terms of the account contract between itself and the Defendant. The Claimant vehemently refutes the Defences contention that they are legitimate contractual service charges. 14. However, and without prejudice to the above, in the event the charges were accepted by this honourable court as being a fee for a contractual service, the claimant submits that they are unreasonable under section 15 of the Supply of Goods and Services Act 1982. 15. Further, under the UTCCR: "5. - (1) A contractual term which has not been individually negotiated shall be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties' rights and obligations arising under the contract, to the detriment of the consumer. (2) A term shall always be regarded as not having been individually negotiated where it has been drafted in advance and the consumer has therefore not been able to influence the substance of the term. (3) Notwithstanding that a specific term or certain aspects of it in a contract has been individually negotiated, these Regulations shall apply to the rest of a contract if an overall assessment of it indicates that it is a pre-formulated standard contract. (4) It shall be for any seller or supplier who claims that a term was individually negotiated to show that it was." Schedule 2 also includes such clauses (to define examples of unfair clauses) as: "(i) irrevocably binding the consumer to terms with which he had no real opportunity of becoming acquainted before the conclusion of the contract; (j) enabling the seller or supplier to alter the terms of the contract unilaterally without a valid reason which is specified in the contract; (m) giving the seller or supplier the right to determine whether the goods or services supplied are in conformity with the contract, or giving him the exclusive right to interpret any term of the contract." The defendant is a multi-national corporation. The term regarding charges was inserted unilaterally in contract. The contract was pre and mass produced and I had no opportunity to negotiate the clause, or indeed any of the contracts. The cost of HSBC's charges have increased on more than one occasion during the period in which my account was held, neither time was I given the opportunity to negotiate, or even notified of this increase. This means the bank has unilaterally altered the terms of my account contract to my detriment, and to their advantage. 16. Following on from the above, the claimant does not accept The Defendants contention that the charges are enforceable as a service charge. It is not disputed that the Defendant is entitled to recover its damages following my breaches of contract, and it is entitled to include a liquidated damages clause. I accept without reservation the banks right to recover its actual losses or a genuine pre-estimate thereof. A penalty however, is unenforceable. 17. The Claimant cites the case of Robinson v Harman [1848] 1 Exch 850 which states that a contractual party cannot profit from a breach and that the charge for a loss suffered from a breach of contract should be the amount necessary to put both parties in the same position before the breach occurred. 18. Lord Dunedin in the case of Dunlop Pneumatic Tyre Co v New Garage & Motor Co [1915] AC 79 set down a number of principles in definition of a penalty clause and how such clause may be ascertained from a liquidated damages clause. One of these principles being - "The sum is a penalty if it is greater than the greatest loss which could have been suffered from the breach" 19. The Claimant will further rely on numerous recorded authorities dating throughout the 20th century up to the most recent case of Murray v Leisureplay [2005] EWCA Civ 963, all of which have upheld and reinforced the principles set down by Lord Dunedin defining contractual penalty clauses and the unenforceability thereof. 20. Further, under the Unfair Terms in Consumer Contracts Regulations 1999, schedule 2 (1) includes to define an example of an unfair clause as – "(e) Requiring any consumer who fails to fulfill his obligation to pay a disproportionately high sum in compensation;" 21. On numerous occasions, the Claimant has requested that the Defendant justify its charges by providing details of the costs incurred as a result of my contractual breaches. Each time those requests were rebutted or ignored. 22. In a recent study undertaken in Australia, (Nicole Rich, “Unfair fees: a report into penalty fees charged by Australian Banks”) it was estimated that the cost to an Australian Bank of a customers direct debit refusal was estimated to be in the region of 54 cents. By reviewing the charges against the above figure, the study estimated that banks could be charging between 64 to 92 times what it costs them to process a direct debit refusal. The study’s key findings stated that in its opinion the Australian Bank’s cheque and direct debit refusal fees were likely to be penalties at law. 23. The Defendant, or indeed any of the UK banks, has never published any information to support how their charges are calculated, or what their actual costs associated with such breaches are, or what revenue they derive from such charges. 24. For their recent BBC2 documentary “The Money Programme”, the BBC appointed a commission of former senior banking industry figures and business academics to attempt to ascertain the actual costs to the UK banks of processing a customer’s breach of contract. They concluded that the absolute maximum conceivable cost that could be incurred by a direct debit refusal or overdraft excess is £2.50, and of a returned cheque £4.50. They did state however, that the actual cost is likely to be much less than this. The commission also estimated that the UK banks collectively derive as much as £4.5billion in profit a year from their charging regimes. 25. It is submitted that the Defendants charges are applied by an automated and computer driven process. This process consists of a computer system ‘bouncing’ the direct debit, and sending out a computer generated letter. It is therefore impossible to envisage how the Defendant can incur costs of £** by carrying out this completely automated process. Note that the letter received notifying of a charge is identical in every instance, and if multiple breaches occurred on the same day, a separate letter will be sent in each instance. 26. On 22nd May 2006, the House of Commons passed an early day motion which welcomed the OFT's statement that default charges should be proportionate to the actual loss incurred. The house described such default charges as "exorbitant" and "excessive". 27. The Claimant also cites a radio interview in 2004 with Lloyds TSB’s former head of personal banking, Peter McNamara, in which he states bank charges are used to fund free banking for all personal customers as a whole. 28. As set out previously, it is submitted that The Defendant’s charges can not be considered to be a service charge. In arguing that they are, they also effectively admit that their charges make profits. The Defendant seemingly contends that their charges are not subject to any assessment of fairness whatsoever. This implies they can set these fees at whatever level they like without limit or regulation. Similarly, as set out above, the charges cannot be considered to be liquidated damages. They, by The Defendant's own admission, are not a pre-estimate of loss incurred as a result of the breach of contract. The charges are punitive, held “in-terrorem", and unduly and extravagantly enrich the Defendant. As such, they are a contractual penalties and unenforceable at law. 29. Accordingly the Claimant claims: a) the return of the amounts debited in respect of charges in the sum of £XXXX and any interest charged thereon; b) Court costs; c) The claimant claims interest under section 69 of the County Courts Act 1984 at the rate of 8% a year, from 17 April 2001– 17 April 2007 of £xxxx and also interest at the same rate up to the date of judgment or earlier payment at a daily rate of £0.00022 I, the Claimant, believe all facts stated to be true.

Jo is checking it over and as soon as its done I will post it on here. Cx

that would be great and thank you. Cx

I've just finished the first draft of the statement of evidence so am really pleased as it wasn't something I was looking forward to . Now I just have to copy everything twice and then put it in folders with dividers and all the other gubbins and then hand deliver one folder to court on Monday and send the other recorded delivery to DG. Fingers crossed and thanks a million to you and everybody else on here for all the help and support. Cx:)

Am I ok then to include it all? Cx

it doesn't say. The only thing at the top of the statement is the account name, sortcode, accountnumber and sheet number. It may have something to do with the fact that they are duplicate statements? There seem to be a pattern of " total charges" each month of the same amount aswell as £10 for this and £30 for that. One charge is £125. Am starting to get worried that I've tried to claim for the wrong thing and maybe I should just pull out??? although, I have to say that one month the following scenario took place and I wonder if I should mention it in the statement of evidence: "Furthermore, on bank statement 158, it is evident how the automatic charge applied to the account for bouncing a cheque due to insufficient funds creates an overdraft on the account which in turn bounces the same cheque 4 times over a few days and every time applying a £30 charge on the account for doing so, thus being the direct cause for the overdraft. This particular time, the claimant complained to the bank and the 5 charges in question were refunded" I have taken the credits into account on my schedule of charges though but thought it may be a good example????

I have since the account first was opened had a couple of overdraft limits on my account but as I can't remember exactly when it was its difficult for me to determine from the statements which charges relate to them. any advice? what I mean is, am I better to go down the route of the charges being disproportionate to what they are for?

thank you. I know it was a stupid question but I've just read through DG's initial defence and I am wavering again!!! I will however complete the statement of evidence before I go to bed tonight! cx

Jo, stupid question perhaps, but on the first line on your statement of evidence there are loads of crosses, should the account number go in there?

yehaaaa.... bring it on. Just been to drop the letter objecting to the application for a stay from DG. Cx:)

I shall go back to my document and get rid of the little red faces!!! only kidding. Right, it contains the following relevant case law to penalty charges dunlop the Unfair Terms in Consumer Contracts Regulations 1999 (UTCCR?) Unfair Contract Terms Act 1977 (UCTA) Supply Of Goods And services 1982 (SOGA) I've included it as it is and not amended it at all. Cx

If everybody keeps their fingers crossed for me (as it has just dawned on me that this COULD be over one way or another in 3 weeks) and it goes my way there will be champus flowing!!!!!!!!!!!!!!!!!!!!!!!!!!!! never mind the wine!!!!!!!!!!!!!!!!!!!!!!!!!!! This is the things that I'm going to put in my court bundle have I missed anything out? 1. Statement of Evidence 2.Correspondance 3.Receipts for the MCOL and the court costs so far 4.Terms and conditions from 1996 which is roughly when the account was opened 5.the statement sheets with charges on them 6.relevant caselaw to penalty charges - as printed out on here(40 odd pages) 7. Printout of the early day motion - 1 Sheet 8. OFT's printout (5 arpil 2006) 9. Prinouts of completed HSBC cases 3 sheets) was thinking of including all banks but thought it may have been overkill. Incedentely this is also going to be submitted with my letter of objection to the application of stay - any suggestions on that? 10.BBC prinout about the Money Programme Bank commission 11. media release from australia 12.transcript of the Peter McNamara interview And that is that. I've come to realise that I should have this in the post by Monday at the latest to comply with the directions of the court. As i'll drop it off in person at the court thats not a problem, but should I send the copy due for DG by recorded delivery? Last minute nerves and adrenaline are starting to kick in. that on top of applying for jobs aswell.....never a dull moment! Cx

I've lost count now on how many bottles of wine I owe you both. Thank you. Cx

or even FreakyLeaky!!! am going to crawl under my desk now and wait for the men i white coats!!!

arrrrrrrgh, only yesterday I came across castlebest thread and now I can't find it. Could have something to do with overloaded brain or just stupidity. Any ideas? I've not come across a letter that is suitable for my situation i.e. DG applying for a stay but the court not responding in favour of them so far. Lateralus suggested that castlebest may have a letter. I thought he was on the HSBC thread? Any ideas?

thanks Lateralus, Ive read it and will shortly commence the letter which I will send off to court tomorrow. Jo, again, thank you! cx

I'm catching up on my emails and didn't realise initially that I'd responded to the "wrong" thread. Its been one of those days...... am keeping to this one from now on. cx

thanks guys, and after the day I've had at work I could do with something stronger than coffee. A hundred thanks Jo for your help, its brilliant to feel so supported, especially at this later stages. I spoke to the court today and was told that as DG haven't paid proper fee the "stay" is not valid!!! I've not come across this one yet so I thought I may send a letter objecting to the stay to court and then get my bundle in this week, or begining of next at the latest. I was going to include a shedule of charges as of this weeks date which will have the accumulated interest on it. I've not added any extra charges but have in error included a couple of £1.75 charges (got a bit carried away in the initial stages). Should I remove these as If I'm not mistaken I think that I've read in one of the threads here that one can't claim back those. Every time I think Ive got the hang of things another thing crops up! hey ho! Cx

thank you all for the advice. I've called the court today and apparently, according to them its still proceeding as DG have applied for a stay but not paid the correct fee or have submitted the correct paperwork. Is this an exceptional case or should I now as matter of urgency go with zootscoots advice and send the letter objecting to the application for a stay and then get my little skates on to complete the bundle? Cx:confused: