Lender refunds repossession expenses charged to customer in part: new GLC legal argument

GLC has settled a court action seeking a refund of a bank's legal expenses levied as the cost of their solicitors raising repossession proceedings against a Scottish homeowner. The action was raised in 2005, and the bulk of legal fees were charged over five years ago.

In Ayr v. BOS plc, the pursuer had contended that on a clear construction of standard condition 12, sch 3, Convenyancing and Feudal Reform (Scotland) Act 1970 and other provisions in that Act, the lender had not been entitled to recoup its legal expenses against its customer because it had failed to serve a pre-litigation 'calling-up notice'.  In light of RBS v. Wilson and others, it ought to have done so.

The case, which was not without additional legal complications, settled extra-judicially for a refund of £600, representing almost half of the lender's costs. GLC will continue to work on how more consumers can secure possible refunds of legal costs, added to their mortgages.