If the Supreme Court upholds the banks' appeal tomorrow it would be an obvious disaster for the rights of UK consumers; but if the appeal is rejected, don't hold your breath as the banks look set to keep on charging while they keep on fighting the Office of Fair Trading (OFT).
Where does this leave ordinary citizens who have been ripped off by unfair and excessive bank charges? Tens of thousands of court actions for bank charge refunds in the English and Scottish legal systems have been 'sisted' (‘stayed’ in England) since the OFT's test case commenced in July 2007.
The British Bankers Association (BBA) is already playing down the significance of an OFT win before the UK Supreme Court, and there is every likelihood that the banks will continue to fight on, whether by pursuing an appeal before the European Court of Justice, or by defending the case on the facts before the High Court in London.
Govan Law Centre (GLC) believes if the OFT wins tomorrow, there is a danger of a ‘constitutional rights’ crisis if tens of thousands of consumer claims remain frozen.
GLC's Mike Dailly said: “It’s a well established rule of law that UK citizens have a constitutional right of unimpeded access to the courts in England and Scotland. Yet tens of thousands of consumers have now had those rights suspended for two and half years”.
“If the court rejects the banks’ appeal, not only does this mean the OFT can assess the fairness of charges, but crucially it means any consumer is now entitled to ask the court to assess the fairness of their overdraft fees”.
“To put it another way, if the Unfair Terms in Consumer Contract Regulations apply to overdraft fees, there is no longer any question of law in dispute, and the reason for freezing claims disappears. Administrative convenience to the banks can be no justification for denying the British public access to the courts”
“Similarly there would be no need for the FSA to continue its waiver on bank charge complaints which expires in January. If the Supreme Court rejects the banks’ appeal, Govan Law Centre will try and re-active bank charges claims in Scotland as a matter of constitutional and human rights law, and we will work with other bank charge campaigners to do likewise across the UK”.
In
IR v Lord Chancellor ex p Witham [1998] QB 575 the court held that the no-one can “abrogate the right of access to justice, unless it is specifically so permitted by Parliament”. This principle has been followed in numerous cases including
R v Home Secretary ex p Leech (No 2) [1994] QB 198, and
Watkins v. Secretary of State for the Home Department and others [2004] EWCA (Civ) 966.
Tomorrow’s judgment from the Supreme Court will remove the reason why bank charges claims were frozen. The only question left in bank charge cases is essentially one of ‘individual fact and circumstance’. Local county courts in England, and sheriff courts in Scotland, are well placed to assess factual disputes, given that the applicable law will have been settled by the Supreme Court.
Any further attempt to deny consumers the right to proceed with their claims will, in Govan Law Centre’s opinion, be unconstitutional, and separately, contrary to Article 6 of the Human Rights Act 1998 (which guarantees individuals the right to have their civil rights determined by an impartial tribunal within a reasonable period of time).
The Herald reports that HBOS' new charging structure - in force from tomorrow - will cause serious problems for many customers. Being overdrawn for HBOS customers by up to £2,500 will cost £1 a day, and for more than £2,500 it is £2 a day. For unauthorised overdrafts, it will be £5 a day – with no monthly cap.
