Bank Charges Test Case - New Hearing Date

The Order of Mr Justice Andrew Smith in the High Court test

case on bank charges brought by the Office of Fair Trading

("OFT") against seven banks and one building society

has been published on the OFT website.

The order records the declarations set out in Smith J's

judgment which was handed down on 24 April 2008 (see previous

Law-Now analysis) which (in brief) were:

that the OFT had succeeded in establishing that the

banks' terms and conditions imposing charges on their

customers for unauthorised overdrafts are subject to the test

of fairness in the Unfair Terms and Consumer Contracts

Regulations 1999 ("UTCCR");

that (largely) the bank's documents containing these

terms were in "plain intelligible

language" within the meaning of regulation 6(2) of

UTCCR; and

that none of the terms giving rise to the charges

examined by the Court amounted to a penalty clause at common

law.

All of the Defendants have been given permission to appeal

against the declaration set out at (i) above.

The order also sets out the future timetable of the test

case. A hearing has been listed commencing on 7 July 2008 with

a time estimate of three days, during which the Court will

determine whether any other terms and conditions in the

bank's documents (which were not covered by the previous

judgment) could give rise to charges capable of being penalties

at common law; and whether the terms imposing charges contained

in the representative sample of historic terms and conditions

which were disclosed in the course of the litigation can also

be assessed for fairness under UTCCR.

For links to previous Law-Now articles on the bank charges

test case, please see below.

Bank charges on unauthorised overdrafts to

be subjected to fairness test

High Court finds in favour of OFT in bank charges test

case

This article was written for Law-Now, CMS Cameron

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