Bank charges case ends second week

Posted on 25 January 2008 by Charcol

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The High Court test case on bank charges today reaches the end of its second week.

The case aims to settle the legal arguments behind the large number of county court cases where personal banking customers have been claiming refunds of their overdraft charges.

The banks have argued that the 'unauthorised' overdrafts to which the charges apply are core to personal banking. As such, they do not fall under the scope of the 1999 Unfair Terms in Consumer Contracts Regulations act, as the Office of Fair Trading argues.

Defending building society Nationwide, which agreed to the test case along with seven high street banks, Mr Geoffrey Vos QC said that there were different contractual positions for customers who were in credit, compared to those in the red.

"It follows, as night follows day, that the debit customers regard their overdraft as the main part of the service," he added.

According to BBC News, the OFT is expected to present its case on Tuesday 29 January. It could be a further two weeks before the court reaches a decision.

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