Difference between revisions of "FAQ"

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==Can I Claim? ==
 
==Can I Claim? ==
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Q. I have been charged (£20, £25, £35 etc...) by my bank/credit card company for going over my agreed overdraft limit. This was entirely my own fault. Do I still have grounds to start legal proceedings against them for recovery?
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A. The law is very clear on this. If you have been penalised for a breach of contract by means of disproportionate penalties, regardless of how the breach came about, then you may have grounds to recover your money
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Q. But I have agreed when I opened my account to pay charges on returned direct debits etc and exceeded overdraft limits.
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A. Yes, you did. The banks are entitled to apply these charges, but not at an excessive rate. Penalty charges must be calculated to reflect the losses sustained by the banks when you cause them a problem. No more. Contractual terms must be applied in a reasonable and lawful way. Banking contracts must be operated within the law.
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Q. I get charged a £5 (£10, £15) fee every month for an overdraft on my current account. Can I get these back too?
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A. If this is a service you have agreed to, then no - there is nothing unlawful about charging for a service provided.
  
 
== What about £12, can they charge that? ==
 
== What about £12, can they charge that? ==

Revision as of 16:40, 10 July 2007


== Introduction ==

Read through this and it will save you a lot of tedious posting on the forums and will save a lot of repetitive replies.

Once you have the basics in mind you will find that you will be able to frame your questions and enter into discussions in a much more profitable way.

Legal FAQs here do not apply to Scotland (Civil procedure)

Scottish FAQs are in preparation.



Please be aware that all advice here is provided informally by concerned volunteers. This group (The Consumer Action Group & Bank Action Group - Fighting unlawful practices and bank charges.) holds out no particular expertise or qualification. It is not responsible for the views of it's Users who post here. The Group makes no guarantee of the accuracy of any of the advice or information which is provided on these pages and you are advised to apply your own judgment at all times.

The Consumer Action Group is merely a campaign and support group.


If you want to understand litigation in the County Court small claims track, then we now recommend Patricia Pearl's book: "Small Claims Procedure: A Practical Guide."

This book is excellently laid out and is a thorough but readable guide for the ordinary person who wants to bring any kind of claim in the County Court.

See a full review here

Can I Claim?

Q. I have been charged (£20, £25, £35 etc...) by my bank/credit card company for going over my agreed overdraft limit. This was entirely my own fault. Do I still have grounds to start legal proceedings against them for recovery?

A. The law is very clear on this. If you have been penalised for a breach of contract by means of disproportionate penalties, regardless of how the breach came about, then you may have grounds to recover your money

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Q. But I have agreed when I opened my account to pay charges on returned direct debits etc and exceeded overdraft limits.

A. Yes, you did. The banks are entitled to apply these charges, but not at an excessive rate. Penalty charges must be calculated to reflect the losses sustained by the banks when you cause them a problem. No more. Contractual terms must be applied in a reasonable and lawful way. Banking contracts must be operated within the law.

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Q. I get charged a £5 (£10, £15) fee every month for an overdraft on my current account. Can I get these back too?

A. If this is a service you have agreed to, then no - there is nothing unlawful about charging for a service provided.

What about £12, can they charge that?

A. NO. The Office of Fair Trading (OFT) issued a directive to credit card companies to set a point at which they (the OFT) would intervene on behalf of the consumer. They did not state that £12 was lawful - in fact they stated that only a court can decide. "A fair default charge should not exceed a reasonable estimate of certain limited administrative costs which the credit card issuer reasonably expects to incur as a result of default"

In other words - reclaim the full amount unless they are willing to show the evidence of what it does cost.


Likewise recent suggestions that Bank charge claims will have to allow for 12.00 charges are untrue...go for the lot...unless they prove otherwise.

Can I PM/Email Admin/Bank Fodder/Dave with regards to my specific case?

Our 'admin' email address receives about 2-3 thousand emails per day with requests for help. Most of these are ignored, not through choice but simply because there are not enough hours in the day. We have families and jobs. If your case is out of the ordinary or is extremely urgent, then you can attempt to PM or email, but due to the sheer volume of requests we cannot guarantee a timely response.

It is far better to start your own thread where many people can see your progress.

Will Claiming Cause Me Problems?

Q. Will suing my bank affect my credit report?

A. No - unless the Bank closes your account - see below.

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Q. Will the bank close my account?

A. It doesn't happen often but you should bear it in mind - see below

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Q. Are there any other risks?

A. There have been instances where the banks have closed or threatened to close accounts by way of retaliation. There is always a risk involved in taking someone to court. If you are in any doubt of your claim, you should contact a qualified professional.

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Q. Can I stop them closing my account?

A. Although there are some legal arguments against this kind of retaliation, it would be very difficult at the moment. You would normally only be able to try and take action about it after the account closure. We are in the process of testing the legalities of account closures, especially with the Alliance & Leicester.

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Q. I was charged on an account that I have closed XX years/months ago, can I still claim for my money back?

A. Yes, regardless of if the account is open or closed, you can claim.

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Q. Can I claim back for more than 6 years?

A. Maybe. There is a separate thread on this in this forum. The statue of limitations states that you can only go back 6 years. However, it also states that if you have had the truth held from you resulting in your not making a claim earlier, that you can claim from the date that you became aware. If you are unsure, you should only claim for 6 years.


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Q. I am so angry - when this is sorted out, should I close my account?

A. No - don't close your account. It makes no difference to your bank. Get an account with another bank by all means but do realise that all the banks are the same when things get difficult. Keep your account. You might find it useful one day. Keep a couple of pounds in it and then just don't use it. Having multiple accounts may give you some flexibility.

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Q. Is there any limit to the amount that I can claim?

A. No. If you keep your claim value under £5000 then the case should stay on the County Court Small Claims Track. This way, if you lose, you shouldn't be liable for costs. However, there are actually some advantages to claiming above £5000 - this is discussed in greater detail on the forums.


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Q: We have a joint account, do we both need to apply/sign when reclaiming?

A: If you both have authority, no.

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Are there any preparatory steps which I should take?

A: You would be well advised to open at least one bank account elsewhere (you will see this referred to on the site as a "Parachute Account"). If your account is closed, it is likely that the Banks will make an entry which could affect your credit score and make it difficult to get even a debit card in the future. Open a new account when your credit rating is still intact. This will allow you to move smoothly to a different bank if you want. This will reduce the leverage which your present bank has over you.

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Q. Do I have to write a letter to my bank?

A. Yes, but we have prepared templated letters for you. See our "Bank Templates Library".

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Q. Do I have to put "without prejudice" on the top of my letter?

A: No, you don't. "Without Prejudice" merely means that the contents of that letter cannot be disclosed to a judge in the course of the hearing of the case. If you really think that you are saying something which you don't want the judge to hear then by all means put "without prejudice". However, most often you will be pleased that the judge knows the whole story. It will tend to be the bank that wishes to keep information hidden. If a letter from the bank or their legal council is marked 'Without Prejudice' you must not show it to the court, unless a judge asks to see it.

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Q. Can I use email?

A. According to the Civil Procedure Handbook, email is an acceptable way of contacting a second party. However, the banks are not keen on it and don't normally reply with emails, so standard mail has become the norm.

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Q. Do I have to negotiate with my bank before I take action?

A. You should claim and litigate reasonably so as not to incur unnecessary expenses for yourself or the bank or cause unnecessary trouble for the court. This does not mean that you have to phone them. An acceptable negotiation process will be to use our templated letters - the "Preliminary Approach for Repayment" and the "Letter Before Action"

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Q. Do I have to send a letter before action?

A. Yes, you should give the bank written notice that you will be suing them.

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What if I have to sue the bank?

Q. How much notice should I give the bank that I am going to sue them?

A. Both of our letters give 14 days for a response. Together, these give the banks at least 28 days to settle your claim - an acceptable timescale for a court.

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Q. I'm worried about costs if I lose the case.

A. If your claim is less than £5000 then it will most likely be conducted within the Smalls Claims procedure of the County Court. Costs are not awarded either to the loser or to the winner unless the case is highly exceptional. The only costs you might lose are the cost of your summons and the reasonable travel expenses of the defendant. If you win, the only costs you will receive will be your summons fee and your reasonable travel expenses.

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Q. Supposing I have a lawyer. Can't I get the costs of that legal help?

A. No, but neither can the Defendant. You should NOT need a lawyer.

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Q. Can I claim interest?


A. When you put in a court claim, and not before, you should claim interest at the statutory rate, which is currently 8%. You must add a section to your claim in the following way: "The claimant claims interest under section 69 of the County Courts Act 1984 at the rate of 8% per year from (date when the money became owed to you) to (the date you are issuing the claim) of £XXX - (enter the amount) and also interest at the same rate up to the date of judgment, or earlier payment, at a daily rate of £X.XXp (put in daily rate of interest)"

You will need to work out the interest you are owed up to the date you start the claim. You first need to work out the daily rate of interest. Using a calculator, do the following: 0.00022 X the amount of your claim – this gives you the daily rate of interest. There is a guide within the N! Particular of claim template.

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Which Track

Q. When referring to the "track" of the County Courts, does the £5000 limit include interest and costs?


A. No, it doesn't. You can claim up to £5000 net of costs and interest and this will not affect the track allocation. However, in determining court costs only, the value of your claim will be the charges total PLUS any interest claimed. If this is the case, then court costs will be set at £250 rather than £120. Remember though, that these court costs will be reclaimable should you win....

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How or Where do I start my claim?

Give credit where credit is due

Page Created By Me01273 00:05, 31 May 2007 (BST)