Bank charges Q&A: door reopened for reclaimers?

The Supreme Court overturned rulings in the High Court and Court of Appeal that bank charges were subject to fairness rules, under clause 6 of what's called the UTCCR regulations. However, it's now becoming clear the banks' victory isn't 100% clear cut.

This is a quick Q&A on how this result affects you.Q. What was this deciding exactly?A. The case was all about whether the £35-ish a time charges banks levy when you go beyond your unauthorised overdraft limit were lawful. Yet it was based on a very specific piece of law. Had the banks lost, the Office of Fair Trading, which has provisionally said charges are unjust, would have decided whether such fees are indeed unfair.

Q. I have already successfully reclaimed charges, can the bank ask for my money back? A. No. Previous bank charges payouts were made as 'goodwill gestures', as the banks did not want to set a precedent. As such, the money is yours and they cannot ask for it back.

Q. Does the hardship rule still apply? Can I still claim if I'm in hardship?

A. The FSA's hold on banks dealing with the reclaim has been lifted, so there is no longer a specific hardship rule. However, under FSA regulations, banks must treat you fairly anyway and be considerate if you are in hardship. If you think that hasn't happened you can complain to the Ombudsman (see How to complain to the Ombudsman guide). Though if it's about bank charges specifically it's best to follow the information below.

Q. My case is on hold with the courts, what is going to happen?A. It has yet to be decided whether the hold on all cases in the courts will be lifted. The Judicial office says each complainant, for now, will have to apply individually for their case to be heard.

If your case is based on the old template letters and the court deals with it, it's very likely to be struck out. Please let us know if you receive a letter to say your case is being heard.However, we believe (more info below) the Supreme Court judge indicated you can claim under another law. We have now engaged a high end banking lawyer (see MSE appoints top QC story) to see if it's possible to redraft our legal templates to amend the claim for the new rules.

Ensure you're getting the free weekly e-mail where we will publish updates on that as soon as possible.

Q. What if my case is on hold with the Ombudsman?

A. There are 15,000 cases on hold with the Ombudsman, and it has not yet made a decision on what will happen, however it has indicated which path it is likely to take.

It is likely to consider NEW and OLD claims under the following circumstances, though there is no guarantee your claim will be successful:

• If in financial hardship.

• Where you've unintentionally slipped over your limit and the charge is disproportionate to the 'offence'. Eg, you go £5 over but are charged £35.

• Where you're incurring a consistent cycle of charges you cannot break out of.

Ensure you're getting the free weekly e-mail where we will publish updates on that as soon as possible.

Q. My case is on hold with the banks, what is going to happen?A. The banks have eight weeks to deal with it and it is likely they are going to be swamped. When they do deal with your case, it's likely to be thrown out if your argument was based the premise of the OFT's original argument, mainly that the value of fees was disproportionate. Please let us know if you receive a letter to say your case is being reopened.

Yet you can always complain to the Ombudsman if you don't like your bank's response, so the principles in the Ombudsman section above may apply. We are also looking at whether it's possible for reclaimers to claim under the new rules suggested by the Supreme Court judge, and have now engaged a high end banking lawyer (see MSE appoints top QC story) to investigate this. Ensure you're getting the free weekly e-mail where we will publish updates on that as soon as possible.

Q. If my case is struck out or my bank rejects the case can I try again?

A. We are looking to see if there is a different legal avenue people may be able to complain under. If that pans out, it is likely you will be able to complain again.

Q. I haven't yet put in a claim, what should I do?A. Hold off for the moment while we assess the new law of the land, and investigate the exact result. Ensure you're getting the free weekly e-mail where we will publish an update as soon as possible.

Q. How likely is it I will get my money back?A. Much less likely than prior to the result, but not impossible. Still, the best thing to do is plan for getting nothing, but cross your fingers. As we know many people would like a 'what's the chance' type answer, our instinctive guess is even with the new argument there is only a 10-20% chance of most people now getting charges back.Q. How likely is it charges will be lowered going forward?

A. Very likely. There is political will for this to happen and the OFT will continue to investigate whether charges are fair. It is likely we will soon see the end to such high charges for going beyond your overdraft limit.

Q. What is the new argument that may help reclaimers and how do I get template letters?

A. In his judgment the Supreme Court President ended saying "the charges might still be open to assessment by the OFT on other grounds". The fact this was deemed important enough to be said in his very short verbal statement is of great significance.

Our analysis is it was a coded message to the OFT saying 'you can't take the case on this legal basis, but there maybe other avenues under clause 5 that you could try'.

Yet the Office of Fair Trading isn’t due to respond until December and meanwhile over a million peoples' claims are on hold, about to be chucked out. So we (MoneySavingExpert.com) have engaged a top banking barrister (see MSE hires top QC news story) to examine the legal arguments.

He will then redraft our template letters both for existing and new claimants based on the potential new arguments and by looking at other consumer protection laws.

You can see some very provisional details in the Bank Charges New Arguments story, we hope the new template letters will be on the site sometime in the week starting 14 Dec, ensure you’re getting the weekly email and we’ll send a reminder.

Q. Does this impact any other reclaiming campaigns?A. No. All the other major reclaiming campaigns are untouched by this, so you can still reclaim credit card charges, mortgage exit fees, payment protection insurance, council tax and more (see the reclaim section for more).However, could be an impact on some of the planned campaigns which rely on the same law, such as reclaiming mortgage arrears fees.

Q. A company called to say it can still get my charges back for a small fee, is this true?

Some firms may say that can still get your charges back for a fee, yet we rarely think this is a good way to get a refund, especially at the moment as the situation is still uncertain. If you do decide to use a solicitor or claims handler, ensure you use strictly no win no fee operators and that you NEVER pay anything upfront or if you lose.

Q. Does this mean the campaign was wrong all along?

A. Certainly not. It's worth thinking about the result of this campaign – over £1bn was paid back. Many banks have lowered their fees, and people have learned banks are there to sell, not to advise, and you can challenge them. Even with today's bad news, that makes it the most successful consumer campaign since the poll tax riots

Never mind the fact that both the High Court and the Court of Appeal agreed with the OFT's case.

Published 5pm, Friday 27th: MSE engages top banking QC Published 12pm, Friday 27th: Martin Lewis' guide to the new argumentPublished 6pm, Thursday 26th: Hope for hardship reclaimersPublished 2:45pm The phoenix from the flames Published 12:43pm Bank Charges Initial Q&A (replaced by this) Published 12:15pm FSA ends bank charges claims holdPublished 9.45am Bank charges: Reclaiming blow as banks win appeal

Other Bank Charges Links Official Judgment: Supreme Court Party leader letters to MSE: Brown, Cameron and CleggReclaiming Guide: Bank ChargesReclaiming Guide: Bank Charges Hardship.