The key headlines are:
The CA dismissed the banks’ appeal, and held that unarranged overdraft charges are assessable for fairness. However, the CA expressly said that there was some hesitation in reaching its decision. This emphasises that the issue is difficult and complex and the CA declined the banks’ request to appeal its decision to the House of Lords.
What happens next?
The banks will be applying to the House of Lords for permission to appeal. This process of applying to the House of Lords is normal practice, and the CA’s decision shouldn’t be taken to mean the House of Lords will not grant permission to appeal.
There will be some media comment around banks having lost the appeal, and this may include speculation that the banks should now repay customers charges. This is not correct because the CA has not said that our overdraft charges are unfair but that they are subject to the test of fairness. Whether the charges are fair will be heard in the next phase of the test case.
The banks will continue to deal with customer enquiries and complaints about unarranged overdraft charges in the usual way. They expect the FSA waiver will remain in place until July 2009 and they are hopeful that it will continue to remain in place until the conclusion of the test case. The CA was explicit in recommending that County and Sheriff Courts continue to keep cases relating to unarranged overdraft charges on hold.