President of the Law Society visits GLC new offices

President of the Law Society of Scotland, Jamie Millar, received a warm welcome and tour of Govan Law Centre's new Orkney Street offices today. Mr Millar congratulated Govan Law Centre, its staff and board members, on securing the newly refurbished premises at the Orkney Street Enterprise Centre (OSEC). 

The facilities at OSEC provide the local community with access to free legal advice and representation, prevention of homelessness services, money and financial inclusion advice, help and support to get back to work or into further education, and access to social work services.

Mr Millar was in Govan to discuss access to justice issues in Scotland, with the Society's new Access to Justice Committee convener, GLC's Mike Dailly. The Society's new Access to Justice Committee is scheduled to have its first meeting later this week.

GLC's Iain Nisbet to address Belfast conference on education law

GLC's Education Law Unit Director, Iain Nisbet, solicitor and partner, will address a legal conference on educational additional support needs in Belfast this week (Thursday 26 August 2010).

The conference is being organised by the Special Educational Needs Advice Centre (SENAC) in Northern Ireland, in conjunction with the Queen’s University Centre for Human Rights.

Iain's presentation will include an examination of the Scottish experience of the Education (Additional Support for Learning) (Scotland) Act 2004.  Other conference contributors include Brian Lamb OBE, Philippa Stobbs and Frances Ross-Watt.  Further details of the Belfast conference are available online here.

Justice Secretary refuses to consider access to justice problems

Scotland’s Cabinet Secretary for Justice has refused to review the problems thrown up in Scottish bank charge cases, and denied there is any problem in Scots being able to take their bank to court to try and recover unfair overdraft charges. Recently, Scots using the accessible and consumer friendly small claims system have had their claims remitted to the ordinary sheriff court, at the request of UK banks, where legal expenses are potentially unlimited.

Following access to justice problems identified in the case of Walls v. Santander UK plc  the Shadow Cabinet Secretary for Justice, Richard Baker MSP, raised concerns over access to justice in such cases with Kenny MacAskill MSP. In a written response, Mr MacAskill said ‘I do not accept the argument that ordinary citizens in Scotland are denied basic rights to access justice’ and refuted any suggestion that there was a problem for Scots trying to recover unfair bank charges through the small claims court.

Mr MacAskill endorsed the sheriff’s conclusion in Walls v. Santander, that Scotland’s current civil court structure and legal aid system provided ‘sufficient’ access to justice from a human rights perspective. Mrs Walls has since lodged an application with the European Court of Human Rights in Strasbourg. Mr MacAskill also stated that he was unable to review the small claims rules due to his ongoing consideration of Lord Gill’s Scottish Civil Court Review.

GLC's Mike Dailly said: “The Justice Secretary’s denial is a mantra which makes no sense. It displays an arrogance and failure to grasp some fundamental facts and principles. UK banks are successfully moving small claim bank charge cases to the ordinary sheriff court, and Scottish consumers are faced with dropping their claims for fear of expenses, or trying to get legal aid if they can – and even then, possibly having to pay a contribution to the legal aid board bigger than their claim”.

“What is particularly puzzling is that Mr. MacAskill refuses to accept any concern whatsoever about access to justice, but our client (Mrs Walls) would have had to drop her claim, had we not been able to get her case sisted pending an application to the European Court of Human Rights".

"The whole point of the small claims court is to provide access to justice for citizens without fear of cost: a remedy which is proportionate in cost to the level of the monetary dispute. But that fair principle of proportionality is being knocked out of the ball park by the current practice of UK banks in bank charge litigation. We don’t have class actions in Scotland, so individual consumers are finding it impractical or impossible to challenge bank charges in court”.

“Kenny MacAskill could easily fix this problem by changing the rules on expenses. We’ve suggested the cap on small claims expenses could travel with the case where it is remitted to the ordinary sheriff court. However, the Justice Secretary says he cannot even look at this issue because he is considering the Scottish Civil Courts Review. That is a non-excuse, which sends a very clear message to the 1 in 5 Scots hit with overdraft charges: the Justice Secretary isn’t interested”.

Consumer bank charges in China and the UK

China Radio International (CRI) reports from Beijing that commercial banks in some parts of China have recently raised the fees charged to customers for withdrawing cash from other banks ATM's. 

An online survey conducted by Chinese website Sina.com showed that almost 90 percent of respondents think the increased charge is exploitative, and will have a negative impact on what is known as the cross-bank withdrawal business.

Now China's Banking Regulatory Commission says that to improve customer service it's considering revising the banks service pricing regulations.  The issue has also raised concerns about the way banks make their profits and how they charge customers for their services.

CRI's current affairs show, People in the Know, speaks to Professor Zhao Xijun of the School of Finance at Renmin University for the Chinese experience of bank charges, and Govan Law Centre's Mike Dailly for the UK perspective of bank charges.

Today's show is available online here.  It can also be heard on smart phones here.

Sheriff reduces property factors bill by 55%

In the case of Walker Sandford Property Management Ltd v. Mushtaq, Sheriff Ross ruled today that a property factor was not entitled to charge a Glasgow consumer monthly interest at 2.5% (equating to 30% APR) as the consumer had never agreed to the factor's contractual terms and conditions.  

Terms and conditions needed to be expressly or impliedly agreed at the outset of the arrangement or adopted by the parties' clear, specific, unequivocal actions. Simply adding the terms and conditions to an invoice was never a way of having conditions adopted. Accordingly, the factor was only entitled to payment in terms of the title deeds, and no interest was chargeable at all in terms of the title deeds.  Such charges therefore fell to be deleted.

Sheriff Ross also reduced the sum charged for second and subsequent monthly reminder/demand letters by one-third from £12 to £8.  Overall the sum sued of £2,678.55, was reduced to £1,213.13, resulting in a 55% reduction in the customer's bill. The action was dismissed with no expenses due to or by either party. The defender was represented by GLC's Iain Nisbet, solicitor and partner, and the pursuer's by Messrs Peacock Johnson Solicitors.

In cases highlighted by BBC Scotland last year, Sheriff Rae expressed concern at the amount of penalties levied by Walker Sandford Property Management Ltd, and in the end the company agreed to drop all penalty charges and interest.  In the past, Walker Sandford had previously issued remider/demand letters on a weekly basis, but now do so on a monthly basis for customers in arrears.

Dodgy figures and poor service: Govanhill evidence to Property Factors bill

Govanhill Law Centre (GhLC) has submitted evidence to the Scottish Parliament's Local Government Committee on the Property Factors (Scotland) Bill. 

The evidence compiled by GhLC's Lindsay Paterson is available here, and includes an example of alleged overcharging, mismanagement and misapplication of VAT by a large Glasgow property factor, as well as a survey of local property factors, carried out jointly with the local Govanhill Residents Group. 

85% of those surveyed supported the statutory regulation of property factors in Scotland, while over two-thirds of respondents said that they did not believe their factoring service was good value for money.

GLC tackles bank charges on Chinese state radio

GLC has participated in a radio discussion on overdraft charges on 'People in the Know', a current affairs programme on China Radio International in Beijing. 

GLC's Mike Dailly was invited to talk to the show's host, Nigel Ballard, about campaign work in the UK, and developments around the world, on challenging bank charges. Bank fees is an issue of growing interest in China. China Radio International, (CRI) is the only overseas broadcaster in the People's Republic of China. 

CRI is one of the "three central media organizations in China" owned by the state along with China National Radio (CNR) and China Central Television (CCTV).  People In the Know is China's only English-language current affairs program. PIK covers events that shape not only China, but the world as well. 

Originally known as 'Ask The Minister,' People In the Know is designed to give CRI listeners the views of experts and 'people in the know.' Foreign guests, including world leaders, have taken part in People In the Know to tackle tough issues, such as economics, diplomacy and national and international politics. CRI broadcasts across China, and the station is relayed around the world as an international service.

The show goes out next Monday, and can also be heard online.

US bank charges: Wells Fargo loses ruling on overdraft fees

The New York Times reports this week that a federal judge ordered Wells Fargo to pay California customers $203 million in restitution for claims that it had manipulated transactions to maximize the overdraft fees it charged.
Instead of processing transactions in the order in which they were received, Wells Fargo put through the largest to smallest, a judge in San Francisco found. In a stinging 90-page opinion, United States District Judge William Alsup wrote that the practice was unfair and deceptive.

“The bank’s dominant, indeed sole, motive was to maximize the number of overdrafts and squeeze as much as possible” out of customers who spent more than they had in their accounts, the judge wrote. The ruling comes after a two-week trial in the spring heard by the judge.  Wells Fargo, which collected nearly $1.8 billion in overdraft fees in California alone from 2005 to 2007, said it would appeal.

The judge’s ruling could portend problems for other banks that are defendants in similar cases. Other federal lawsuits regarding overdraft fees have been consolidated into one class-action suit in Florida, which also claim that Wells Fargo and other banks manipulated transactions to maximize overdraft fees.

Ruben Honik, one of the lawyers representing plaintiffs in the Florida case, said the judge’s ruling would provide a “road map.  It was a litmus test for our theory and the whole approach we took.”.  Overdraft fees have become an important source of revenue for banks and credit unions in the last decade, particularly as debit cards have risen in popularity.

GLC's Principal appointed Convener of Access to Justice Committee

GLC's Principal Solicitor has been appointed Convener of the Access to Justice Committee (AJC) today by the Council of the Law Society of Scotland.  The AJC is responsible for promoting access to justice for the public in Scotland; monitoring the supply of publicly funded legal assistance across Scotland, encouraging greater co-ordination of services and liaising and negotiating with external organisations such as the Scottish Government, the voluntary advice sector and others bodies. The AJC also collaborates with other Law Society of Scotland committees, including Civil Justice, the Civil Legal Aid negotiating team, Mental Health and Disability, Equality and Diversity and Human Rights and Discrimination.

GLC welcomes £2m rescue plan for Govanhill

Glasgow's Evening Times reports that nearly £2million of Scottish Government money has been set aside to help transform Govanhill. The South Side community has long struggled to cope with cowboy landlords, poor housing, overcrowding and fly-tipping.

Campaigners, supported by Govanhill Law Centre, have been pleading for years for help to address the area’s complicated problems. Now, backed by local councillors, MSPs and Govanhill Housing Association (GHHA), locals have been given £1.8m to start tidying the area.

Part of that plan includes the creation of an enforcement squad – made up of council staff, police and fire officers – with an "armoury" of powers to crack down on slum landlords.  The team will have an annual budget of £300,000 with funding guaranteed for two years.  And lawyers from Govanhill Law Centre, led by Lorraine Barrie, will also be closely involved. Operating from a base in Coplaw Street, it will be the first time all the agencies have been brought together.

Lorraine said: "This new strategy is fantastic. What will really help is if we get the public involved and work on information they give us so we can target problem areas."  The new hit squad will track down unregistered landlords and enforce environmental health laws. Currently, any landlord running a house of multiple occupation without a licence can be fined up to £5,000. As part of the new measures, the maximum fine will next year rise to £20,000.

The Housing Bill currently going through Parliament is intended to strengthen powers for councils to ensure owners look after their property. The Government will review the current landlord registration system later this year, with the aim of helping councils ensure all private landlords sign up.  Lorraine added: "The new measures will give us a powerful armoury and help us take the power back from people who are breaking the law." 

The full story from the Evening Times (which is running a series of reports from Govanhill all of this week) is available online here.