The Test Case: where it all went wrong The way that the OFT handled this whole issue of penalty bank charges can be explained either as a cock-up or a conspiracy. In the cock-up theory, the OFT was determined to sort out the scandal of penalty bank charges but made mistakes in the whole process of how it set up the test case with the banks, how it allowed the banks to run rings around it through the whole process and was unfortunate to come up against a rogue decision from the Supreme Court at the end of the process. With the conspiracy theory, the OFT never really wanted to win this case – it was under pressure from the government because of the parlous state of the banking industry and the government had decided that it could not afford for the banks to lose; so the OFT made deliberate tactical mistakes thoughout the process. Which of the theories is true? I suspect that it is a combination of the two. The OFT's heart was not really in this case, it was under pressure from the government to go easy on the banks but it did its best, but its best was not good enough. If anyone had set out in 2007 to make sure that the test case was handled as badly as possible, they probably would have done exactly what the OFT did. Consider all the mistakes that the OFT made. First, why was the test case announced out of the blue in July 2007? The OFT had been alerted to the issue of unauthorised overdraft charges and how unfair they were as early as 2005 when I and other campaigners started taking up the issue. At the time, the OFT was tackling the banks over the related issue of penalty charges on credit cards. The OFT told me and others that they would deal with current account default charges once the credit card charges issue had been successfully resolved. They gave the impression that they thought that current accounts could be sorted out fairly simply after the principles were established with credit cards. However, the OFT did not sort out the principles with credit cards. Instead they reached a grubby compromise with the banks in the summer of 2006 whereby they agreed to lower their default charges from a typical level of £25 per incident to no more than £12. In return, the OFT would take no further action against them on this. Therefore, the legal principle was left hanging. The OFT then slowly started to look at current account charges. Meanwhile, I and other campaigners were becoming increasingly successful in recovering unauthorised overdraft charges from banks by the simple expedient of issuing County Court summonses. Almost invariably, the banks rolled over and paid up without arguing the case in court. By the end of 2006, the banks had probably paid out several million pounds to claimants. But this was small beer compared with the profit that the banks were making from these charges, estimated to be between 3 and 5 billion pounds per annum. Then, in the first half of 2007, the scale of payouts from the banks exploded and in 6 months the banks paid out in total about £700 million. At this level, these amounts had to be reported in the banks' half yearly figures to the Stock Exchange. Suddenly, the cat was out of the bag and it is likely that the scale of payouts in the second half of 2007 would have been even more. This was becoming a serious issue for the banks and action had to be taken to stem the flow. I believe that the test case was, therefore, initiated by the banks and not by the OFT. If you ask them who initiated it, you get a very fudged answer. Interestingly, Royal Bank of Scotland did not seem to agree with the other major banks about the need for the test case and they signed up to it a day after the other 7 banks did and Sir Fred Goodwin (yes, that man again) was quoted in the press as saying he did not think it was necessary. See Banker of the Week story about this. The terms of the agreement to fight the test case looked as though they had been put together hastily. The first mistake that the OFT made was to allow the banks to throw into the equation the issue of common law penalties. This issue is crucial for business account customers who are not protected by the Unfair Terms in Consumer Contracts Regulations 1999 (UTCCR). The banks wanted it in so that they could get a declaration which would suit them in respect of business accounts. The OFT has no duty or remit to consider this issue but they allowed it to be put into the case. Then to cap this, within a few weeks, a senior OFT spokesman essentially surrendered on the common law penalties issue before the case was anywhere near the court. See test case update Sept 2007. The next bizarre aspect of the test case was that it was agreed between the OFT and the banks that the first batch of bank terms that would be considered by the High Court judge to see whether or not they were subject to the test of fairness in the UTCCRs would be the new terms that the banks had produced after they had started paying out on claims against them. These were terms that had been written specifically by the banks' lawyers to try to make out that the unauthorised overdraft charges and similar penalty charges were all part and parcel of the normal terms rather than their being default charges. Some of these new terms had not even been written by the time the test case agreement was drawn up in July 2007. They were written after this date and then presented to the judge for consideration. Only when the judge had considered the new terms would he go back and look at what were now being called historical terms. This seemed bizarre because most of the claims in the Court system which were on hold related to the historical terms. Since the test case was supposed to bring "clarity" to the issue, why was the case concentrating first on terms which had not been involved in the claims on hold? Of course, the way these terms were being considered suited the banks. The new terms were more likely to be OK and once this was established, it would set the mood for what would then look like more of an academic exercise on the historical terms. The test case came before the High Court Judge in January 2008. In April, he announced his first judgment on the new terms. This was essentially a score draw between the OFT and the banks. The banks got what they wanted on the common law penalties with Justice Smith saying that they were not penalties. On the UTCCRs, he found that they were subject to the test of fairness but that they were not default charges. This meant that the level of charge would have to be agreed between the OFT and the banks. Then in October, the judge found similarly in respect of historical terms. To be frank, this was a nonsense. It is clear that in some of the banks' historical terms had express clauses that said that going overdrawn without agreement constituted a breach of contract. This means that it is a virtually cast iron certainty that they would be subject to the common law rules on penalties. But Justice Smith just ignored that and gave a ruling that suited the banks. The banks appealed against the rulings on UTCCRs but the OFT did not appeal against the ruling on common law penalties. It should be noted that the whole case was argued in court between barristers for both sides without any witnesses being called such as individuals who had been crucified by bank charges nor even high street bank managers who had to deal with customers and who could have been cross examined about what they thought the relationship was between the bank and its customers. This would have produced a very different version from the tale that the banks' barristers spun about some hypothetical relationship. Given that this dispute is about how banks treat their customers, is it not strange that no customers were ever allowed to testify in court? If the OFT had not intervened and launched the test case, any case that had come to a contested court case would have had to consider the evidence of a real customer. The Court of Appeal upheld the High Court judgment regarding UTCCRs. At this stage, it looked inevitable that the banks were going to lose this argument. Going to the House of Lords with the case looked just like further delaying tactics. So on it went to the House of Lords and meanwhile all claims in the system remained on hold and the banks continued to plunder their customers' accounts at will. By the time the House of Lords was due to give its ruling, it had been revamped to become the Supreme Court. And so, on 25 November 2009, the Supreme Court overturned all the previous judgments and essentially said that the banks could do what they liked. On 22 December, the OFT threw in the towel and said that they would not try any further legal challenge. So what were the mistakes (deliberate or accidental) that the OFT made? The OFT did not have to bring the test case at all. It could have stood back and allowed individual campaigners to continue to make claims. After all, we had achieved refunds of over £700 million with no help from the OFT. When the OFT launched the test case, the first thing that happened was that the good guys were disarmed. If the OFT wanted to fight a test case, it could have picked off an individual bank rather than allow 8 banks to gang up against it. In the test case, the one OFT barrister was always faced with 8 opponents. So, the banks had a tremendous advantage in that they had 8 attempts at cross examining the OFT. And when presenting their own cases, they could watch each other and learn from each one before amending their own presentation accordingly. The OFT had only one shot on goal; the banks could take 8 attempts. The OFT should not have allowed the banks to put into the test case the issue of common law penalties. The OFT had no remit to defend business account customers. So its heart was not in this. Having agreed to have common law penalties in the test case, the OFT spokesman should not have sold his team short by stating publicly that he did not think that they would win that point. The OFT should not have agreed that current terms were to be considered before historical terms. This played into the hands of the banks. If the arguments had been made on historical terms first, it would have been much easier to win the default charge argument on those; then the OFT could have successfully argued that the current terms were merely worded deliberately to disguise the true nature of the contract. The OFT should certainly not have allowed banks to put to the High Court terms which had not even been written by the time the test case was announced. The OFT should have called bank customers as witnesses and should have insisted on an actual bank manager being cross examined. The OFT should have appealed the common law penalty argument and produced much more robust evidence from banks' historical terms and from letters written by banks that supported this argument. The Supreme Court had suggested that there might be other grounds on which the OFT could challenge the banks. But, instead, the OFT unconditionally surrendered. Overall, an abject performance by the OFT. from Bob the bankbuster..... So what do we do know to sort out this sorry mess!!!!!!!!!!

Who Cares It Aint Going To Change Anything? What Is, Is Direct Action Closing A Bank Through Withdrawals In Protest Or Not Paying Any Direct Debits For A Few Months In Protest.... Not Sure But Needs To Be Direct And Swift

4783 Posts So Far,,,,,, We Aint Going To Win With Any Legal Argument And They Know This.... What Next!!!!!!!!!!!!!!!!!!!

I am up for anything so what next.... We need to set something up and within the next few months before general election, facebook support, media support, etc etc ..... There are enough brains on here to sort this out or do we set up a more proactive site up for the people who are tired of talking..... I am happy to meet up to discuss and plan strategy.... I wish cag would get behind such a scheme as it ha sdone so much good but now it seems to be petering out like a well used candle.... the 1700 or so guests must all be rubbing their hands together... CAG do something about these 1700 get them to join with full details or let them pry elsewhere....

what now????? come on people lets grow a back bone.... Jesus look at the media some **** got when they wanted to march at wooton basset.... Surely we can come up with some way of making somebody sort this travesty out.... my idea would be for all those people who will never need credit again.. ie pensioners etc.... to move to one designated bank and move all in payments to it and then just forget about their debts.... I am not a pensioner but I also am planning this , let them chase me for 6 years or so.... I am tired of spending hundreds of hours on CAG and getting more frustrated without taking action.... why did we let the oft fail..... this is getting worse by the day and this is what they want.....

hi poppay try natwest basic step account or halifax basic they should not refuse and they can be done online. also landy how far has case gone , maybe if not gone to far it can be cancelled and try ombudsman.... what about the rest of my thread when are we to discuss on this thread a more productive direct form of action.... they will only listen to majority when they cause some problems for them.... can site team discuss and put something on front page we can all vote for and show our support for and then carry it through... democratic and supported

MSE money expert has issued some (some) guidance , mainly for financial hardship cases.... this needs to be stepped up in some way those with cases in court or those not yet in financial hardship and all those who just pay these charges and are unaware to be helped....... Just the other day a family friend brother passed away , when his relatives looked at his bank statement they found in 12 months nearly £1200 was taken out of his account in charges.... He was an elderly guy and he just kept moving money from his savings to make sure he had money.... He did not know about CAG, or court case, or even that he could do much about it... I dont even think he read his statements. How sad, something has to be done immediately time for talking and arguing has to stop... They are laughing at us all and many are on here giving obstructive or keep calm advice....not for me.... I advise every one to switch banks and let them chase for overdrafts, loans, credit card debts etc... especially if you are not likely to want or need credit in the future (OAP's) this will give them some pain , like they have inflicted on us and with support of regulators, courts are just putting 2 fingers up to us all.....

1700 guests 300 caggers..... are they scared of something??????????

hi freedom , I am missing your point are you sitting on fence or have you fallen to one side... I notice all your cases ongoing and wonder what your point is???? This is not about getting out of debts it is about restitution... if banks and others had played fair then maybe we wouldnt be here... they all got greedy and someone started saying no... then the snowball begins and they realise they shouldnt have been so greedy.... we are helping the few become millionaires with our money... what frustrates me is that when a few people on here try and find ways of not paying for whatever their reason is... then we people attck them with morality..... MP's expenses, bankers bonuses.... I do wish people would direct the moral issue to those who started this house of cards... I am not justifying anyones attitude but we only hear half the story so I think it is best to try and help them with positivity with which ever stance they decide to take.... lets us not judge lets help if we can and if we cant dont try and give moral guidance.... forcing such moralty is dangerous as is forcing religion!!!!!!!!!! just my opinion.... people seem to have very short memories!!!

hi reneg (ade) (otiation), I agree with much of all you say... but as individuals we can not fight the establishment.... MP's expenses is a big example(do we expect any of them in jail), chilcott enquiry(huge waste of money what will actually be end result will blair go to jail).... Bank charges is just another example of wool over the masses eyes... I am not sure personally of the best way forward but I do agree it needs to be direct action... see my post 22.... Please dont waste time arguing with each other and try and spend time finding ways of taking fight to this establishment....This is a democratic country run by the media, mass interest multiplies rapidly... we need to set up a political party (cost £500) called none of the above... and get people to vote for none of the above.... what do you think I have mentioned on many threads... imagine interest we could get we might even get a slot on question time....

hi mo any news???? Martin any joy with mine... sorry to pester???

good luck then oily....

why target one group your bank with one idea.... if we get enough people lets threaten with starting a new political party ! costs about £500 called none of the above..... Then I suggest we get a list of injustices from a wide range of areas and ask for them to be looked at if not we facebook and press everybody to vote for non of the above( brewsters millions) the idea and 100,000 will generate mass interest and get a million votes overnight.... Non direct debit charges bank charges mortage costs late fees overlimit fees high petrol prices high food costs high energy costs

This needs large banner on front page of cag... everyday now there are 200-300 registered caggers and often over 1500 guests.... they are watching to see our strength and I feel we are running out of strength and energy... something needs to be done and I have 20-30 people locally and a coach who will support any campaign immediately....

What about everyone, simply move banks and cancel all direct debits and dont pay anything connected to banks... cards, loans , overdrafts etc.... am I being stupid or just very irritated by what these companies are doing to us... only mass support will achieve anything!!!!!!!!!!

If they are rejecting CCA and sec5 utccr then what next.... I feel this challenge is fading... I remember the day od suporeme court judgement and there was real anger.... I feel unless something happens soon we need to take a more public action... march on downing street or something as this is beyond a joke.... they can do what ever they want... people are even coming out fighting against obamas ideas.... this is quickly becoming a joke... the law is being interpreted by regulators and judges to suit the banks... we bail them out , they continue with bonuses, everyone forgets mps expenses.... PLEASE CAN CAG COME UP WITH SOMETHING WE CAN ALL SUPPORT FRONT PAGE BANNER AND LETS GO FOR THEM.... TAKE A LEAF OUT THE BOOK OF THE FRENCH !!

I used govan law templates and natwest have responded with a 3 page letter... denying all issues and stating that case is closed and this is final response...

hi my point is that I am having great difficulty in firstly finding why there are 3 CRA in this country and their is not one piece of legal argument they have to be there in the first place. In fact their existence is in breach of data protection act... we give permission for companies to share our data.... who give cra's permission. I have over the last few years read on cag about many people challenging CRA's and these people at court stage seem to disappear... my point is that either cra's realise they have no right and pay people off with big silence clauses. uk26, surelybonds, Until I find evidence of CRA's in court defending their actions then my advice will always be to challenge them as they have a great deal more to hide.... sorry for getting personal but I think you have missed my point or have I made it badly.... I recommend everybody data subject access request the cra's and then look for legal argument for them all to hold and sell your data.... please when you find any post here thanks!!!

please dont predict what cag was set up for , it has eveolved as the issues have... as you say just my opininon but I believe cra do not have any right legal or otherwise to hold our data... and I think that they will face a tsunami very soon... the more the merrier lets get back to face to face banking and let the weakest fail... not prop them up... as one industry faces challenges such as the banks are doing another will rise(manufacturing) these things happen in cycles and have done over hundreds of years..... good luck hillards but I recommend if you have no help to what someone is trying to achieve then I would leave thread alone for someone who may be able to help rather than give moral opinion... IMHO

moral high ground I think, judges will decide cases on points of law and those that breach the law should be challenged even if just to clean up their own act.... in the meantime if people benefit from their errors then great if judges make their own decisions then they should be challenged...appeals etc until the law is enforced correctly these regulations and laws are put in place to protect the consumer and if businesses in an attempt to save money dont get their house in order then stuff the moral high ground... they should suffer also ... like I have said they have no morality when you nake a mistake... do they say oh dont woory just pay double next month.... no they make you call on 0845 numbers , they then charge you for missing payment , some companies then cut your equipment off and then charge for reconnection, they charge for paying by cash and not direct debit.... what next ???? They gave up their rights for us to be moral when they forget theirs!!!!!!

I would also check other threads as many would also believe and give advice on removing default.... you might need to get credit in future so to try will cost very little with help from here....

also if a court can not enforce a debt then in my opinion how can they report to credit files????? they need to prove to the credit reference agencies that their is a debt and the agreement has all prescribed terms and that it gave the creditor the ability to report to agencies.... it is your signature that gives them this authority and without an agreement how can they prove they have been given permission...... It is the Credit reference agencies that need to be challenged on mass. As for the argument above,,, lots of people take moral highground..... If it is morality that banks etc want to use to have credit repaid then that is their own fault... when we break their rules thay punish us beyond belief.... when thay breach the law and twist the regulations when it suits them.... we are expected to morally pay.... Is this the british way..... I become more dissilusioned by the minute... My suggestion is that each individual takes what ever stance they choose if they want to try and not pay a debt and try and have removed from file then that is fine.... I would recommend that each takes their own views and supports with the problem in hand.... It is up to the individual , to force morality on people is like forcing religion on people and as we can all see that is very dodgy ground to tread.... Please just try and help people with what ever they decide they are trying to do.... If it works or not for them then cest la vie!!!

cheers sent email through vodafone with wrt135 code

ask the credit reference agencies when you gave them permission to own share and sell your data..... As more and more people win cases against creditors more defaults will be registered . It is the CRA's that need to be challenged .... By which law are they allowed to even exist and why do we have to pay 3 of them to get our own data from them..... By which misguided piece of legislation where they conceived.... this should be front page CAG as I believe this is even bigger than BANK Charges... why dont we come up with some kind of mass class action against CRA's funded by CAG donations to set some precedents.... if the best we get is a reduction from 6 to 3 years then I think it is a battle worth fighting even 3 years is too much though as I believe this should be a centralised database with very strict criteria for entering information.... not paying a twenty pound mobile bill stopping you get a life changing mortgage of say 3.75% is totallu unacceptable ....... what do you think caggers????? Credit Report Click link to open in new window.

wether or not we think they are allowed to file default with CRA's I am confident they will.... here is a post I have just posted on another thread that I think we should all bear in mind and try and collectively do something about....I am going to try and put on as many posts as possible until we can organise a collective front page stand....