Bank Charges Hearing: The Consequences

We consider what impact barrister Tom Brennan's bank charges case might have on the rest of us.

The next date for barrister Tom Brennan's court case is Monday 21 May. His claim has three stages:An application hearing. This is where he is now. The main story here is that the judge is listening to arguments from NatWest that the claim should be struck out without being heard.The 'actual' hearing. If Brennan survives the first round, the judge will then hear his claim.The appeal. There's little doubt that the loser, be it Brennan or NatWest, will appeal.Here's my view of the various possible outcomes, focusing on the consequences to claimants.Scenario one: Brennan wins the application hearingThis is nice and simple. If Brennan wins the first stage, he'll be allowed through to the next stage: the 'actual' hearing. (See scenarios four onwards.)Scenario two: Brennan loses the application hearingThe worst impact of Brennan losing the application hearing is that many people will incorrectly think that they shouldn't pursue a claim, which will be a setback to the campaign for recovering bank charges.These thoughts would be incorrect, because the application hearing is not about whether bank charges are lawful; rather, it is to decide whether his claim should even be heard, since Brennan has already been refunded (in a nutshell). Unfortunately, I think his chances of winning the application hearing are probably on the wrong side of 50/50, although that still leaves a fair bit of scope for a victory.Scenario three: Brennan appeals the application hearingIf Brennan loses the application hearing, he may be able to appeal on a point of law. If he has a good argument, he has perhaps a 50/50 chance of winning that appeal...See scenarios one and two again!Scenario four: Brennan wins the 'actual' hearingIt's difficult to define a win, because Brennan's claiming all sorts of things and he probably won't get all of them. In addition to bank charges, he's claiming exemplary damages, aggravated damages and consequential loss.Don't worry about what all this means just yet. I suspect that he's claiming the last three simply as a way to help force his bank charges claim past the application hearing stage; he might win the bank charges element and lose all the rest.If he wins the bank charges element then NatWest customers might find it easier to recover their money. Furthermore, all other claimants will get a psychological boost.If he also wins the damages and consequential loss, then we'll need to show other claimants how they can do the same. (Although that will leave me open to further accusations of communism from my colleagues with shares in banks!)Scenario five: the result of the 'actual' hearing might be messyYou must realise that a win for you might not be a win for Brennan, and vice versa. It depends how he pleaded his claim. If he's done it carefully, the judge should make a ruling on whether bank charges are unlawful, which will be useful for all of us, or, at least, to other NatWest customers.If Brennan didn't plead carefully (or NatWest's lawyers are otherwise too slippery), the result might make no difference whatsoever to our claims.However, even if the judge does rule that the charges are unlawful, Brennan might have to pay NatWest's costs, which will cost him a lot more than he will win in compensation. Still, I think that Brennan being told to pay costs is just a tiny possibility if it gets past the application hearing stage.Also, I should remind you that regular claimants such as yourselves have no risk of paying your bank's legal costs, provided you follow guidance, and you claim less than £5,000.Scenario six: Brennan loses the 'actual' hearingIf he loses his claim for bank charges on the basis that they are lawful (which is unlikely!) then the banks will probably stop paying claims altogether. We'll then have to consider why Brennan lost his claim, whether it was unique to his rather unusual claim, and whether it's worth taking any further claims all the way to court.Scenario seven: a word on appealsThe appeals process (presuming the appeal is allowed) will simply delay the effects described in scenarios five and six. If Brennan wins the appeal, see five. If he loses, see six.Sorry that all the above reads like one of those adventure game books: If you want to attack the dragon, go to page 311. To view the remains of the last person who attacked the dragon, go to page 243!Is this claim worth the risks?Sadly, I don't think so. For Brennan personally it could mean bankruptcy. For everyone else, if he loses the application hearing, it'll have the reverse effect that we want: many people will stop claiming.If he wins, we get a psychological boost, but how much is this boost needed when claims are already snowballing, and when previous successes are already encouraging people to pursue their banks? Even if a victory speeds up the claims process, I don't consider that to be enough of a reward.Still, I wish Tom the best of luck.> More articles on this case:The First Bank Charges Court Hearing, 12 April 2007The Fool Talks To Bank Charges Crusader, 20 April 2007Bank Charges Court Update, 1 May 2007> Read The Ultimate Guide To Reclaiming Bank And Card Charges> Compare current accounts and savings accounts.