17 May 2007
Consumers who are considering challenging their bank over unfair current account fees were urged not to be put off by Lloyds TSB's court win this week over Kevin Berwick.
District Judge Cook ruled in favour of the bank in a case brought to court by Mr Berwick over his overdraft fees, totalling 2,545.
Mr Berwick claimed that these fees were unfair because the bank was paying out a far less amount to deal with the necessary bureaucracy of his overdraft usage, but the judge decided that there was no evidence that the fees were unreasonable.
In District Judge Cook's view, the fees were not charges for a breach of contract but instead were a recognised part of the price of the service provided by the bank, meaning that he felt unable to rule that the charges were unfair.
The price comparison and switching website uSwitch.com has urged consumers not to be downhearted about the result however, with Mike Naylor, Personal Finance Expert at uSwitch.com, declaring that since the result came from a district court, it was unlikely that the judgement would be considered binding in any other court in Britain.
"We hope that this news does not further confuse and baffle consumers any further with regards to what is and what is not, a fair charge on their accounts," said Mr Naylor.
"In the interim, while we wait for the Office of Fair Trading to report back on its findings and recommendations in this area, we would like to see consumers offered more guidance about the options that are available to them," he concluded.
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