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| Version 0 | Version 1 |
|---|---|
| Bank charges appeal is thrown out | Bank charges appeal is thrown out |
| (10 minutes later) | |
| An appeal by eight banks against a ruling that a regulator can investigate the fairness of overdraft charges has been thrown out. | An appeal by eight banks against a ruling that a regulator can investigate the fairness of overdraft charges has been thrown out. |
| The Appeal Court ruled that the Office of Fair Trading (OFT) has the power to look into the issue. | The Appeal Court ruled that the Office of Fair Trading (OFT) has the power to look into the issue. |
| Master of the Rolls Sir Anthony Clarke said the banks could not appeal against the decision in the House of Lords. | Master of the Rolls Sir Anthony Clarke said the banks could not appeal against the decision in the House of Lords. |
| Tens of thousands of claims currently on hold in the English and Scottish legal systems will stay frozen. | Tens of thousands of claims currently on hold in the English and Scottish legal systems will stay frozen. |
| Sir Anthony dismissed the appeal and told the banks they should now allow the OFT to decide whether their charges were fair or not. | Sir Anthony dismissed the appeal and told the banks they should now allow the OFT to decide whether their charges were fair or not. |
| However, cases will stay frozen until the OFT has concluded its investigation. | However, cases will stay frozen until the OFT has concluded its investigation. |
| Unanimous decision | |
| The banks had argued that their overdraft charges fell outside the scope of the 1999 Unfair Terms in Consumer Contracts regulations. | |
| It is great to see the Court of Appeal being so unequivocal in their guidance to the banks Chris Warner, Which? | |
| However, the three Appeal Court judges rejected this. | |
| "We have unanimously concluded that the application should be refused," said Sir Anthony. | |
| "The issues should now be resolved by an OFT assessment of fairness." | |
| If the banks wish to appeal further they will have to appeal directly to the House of Lords for permission. | |
| Bank charges campaigners were delighted with the Appeal Court ruling. | |
| Chris Warner, of the consumers' association Which?, said: "It is great to see the Court of Appeal being so unequivocal in their guidance to the banks that this is the end of the road. | |
| "They should now let the OFT do its job. The banks have the right to appeal to the House of Lords but the Court of Appeal could not have been clearer that that is not the appropriate way to go forward." | |
| The British Bankers' Association (BBA) said: "These are important points of law. The courts can now go on to clarify the fairness of charges. Before that can happen the Office of Fair Trading [OFT] has to provide the courts with its views on how charges should be assessed." | |
| Next stage | |
| This is the latest stage of litigation between the OFT and eight banks which started in July 2007. | |
| Since then, tens of thousands of claims for the return of overdraft charges have been frozen in the English and Scottish legal systems waiting for a test case to eventually decide if bank overdraft charges are fair or not. | |
| If the OFT ultimately wins the case, several billion pounds could potentially be refunded to millions of bank customers. | |
| The banks must now decide if they wish to argue over the OFT's jurisdiction to the House of Lords or whether they should now proceed to a second round of court hearings over the issue of fairness itself. | |
| Alternatively, they could try to cut a deal with the OFT to short-circuit the whole process if they felt they were likely to lose. |