Brennan v National Westminster Bank Plc

A claim for repayment of bank charges should not proceed where the principal monetary claim has been satisfied and the remaining claims have no reasonable prospect of success. A declaration concerning unfair terms must be assessed in the circumstances of the particular consumer contract and cannot determine the position under other contracts. An account of profits is exceptional and requires an evidential basis. The Unfair Terms in Consumer Contracts Regulations 1999 provide specific remedies for unfair terms and do not create a private tort or damages action merely because a term is unenforceable. Aggravated and exemplary damages require an established tort and a proper factual basis.

The claimant pursued repayment of charges applied to his current account, alleging penalty charges and unfair terms under the Unfair Terms in Consumer Contracts Regulations 1999. He later sought amendments adding claims for a declaration, an account of profits, consequential, aggravated and exemplary damages, and breach of statutory duty.

The bank refunded the charges, interest and related sums. His remaining claims and proposed amendments were struck out or dismissed by His Honour Judge Simpson. Flaux J refused permission to appeal in writing. This was the claimant’s renewed oral application for permission to appeal.

1. Permission refused. Pitchford J agreed with Flaux J that there was no reasonable prospect of successfully challenging the earlier order. The bank had satisfied the sustainable monetary claim by refunding the charges, interest and consequential loss. A claimant’s public-interest motive did not justify continuing proceedings where no arguable relief remained.
2. A declaration in the proposed terms could not properly be granted. Under regulation 6 of the Unfair Terms in Consumer Contracts Regulations 1999, fairness had to be assessed by reference to the circumstances attending the conclusion of the particular contract. The court could not determine the legality of terms in contracts made with other consumers at other times.
3. An account of profits was an exceptional remedy. Following the general guidance referred to in Attorney General v Blake [2001] 1 AC 268, there were no exceptional circumstances, no evidence that the bank had obtained profits properly accountable to the claimant, and no evidential basis for expert investigation. The charges had already been refunded.
4. The allegation of inflicting loss by unlawful means was hopeless on the principles analysed in OBG Limited v Allan [2007] 2 W.L.R. 920. The case did not involve the relevant tripartite economic tort, intimidation, or a crime committed against the claimant.
5. The Regulations did not impose an actionable statutory duty requiring the bank to levy proportionate or fair charges. Regulation 8 made an unfair term unenforceable, while the Regulations provided specific enforcement mechanisms, including the Director of the OFT’s functions and injunctive relief. Verein fur Konsumenteninformation v Karl Heinz Henkel [2002] ECR I-8111 concerned jurisdiction and a third party’s injunction claim; it did not establish a private tort action by an individual consumer in England and Wales. Garden Cottage Foods Ltd v Milk Marketing Board [1984] 1 A.C. 130 did not support the claimant’s argument.
6. Aggravated damages could not be recovered without tortious liability and were unsupported by any conduct causing injury to dignity or feelings. Exemplary damages likewise lacked evidence of calculated wrongdoing. The late attempt to reopen charges from 1998 to 2000 was speculative, unparticularised and statute barred.
7. It would be disproportionate to allow the action to proceed merely to expose the bank’s practices publicly. The earlier refusal of amendment and the strike-out or dismissal of the remaining claims were upheld.

• High Court (Queen’s Bench Division): renewed application for permission to appeal refused. The court agreed with Flaux J’s refusal and upheld the order of His Honour Judge Simpson striking out or dismissing the remaining claims.