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Last Updated: Thursday, 28 June 2007, 16:10 GMT 17:10 UK
Judge warns banks over fee cases
Ian Pollock
BBC personal finance reporter at the Leeds Mercantile Court

Twenty pound notes
Banks have been compensating customers
Dozens of bank charges cases were settled at the Leeds Mercantile Court after the judge threatened to use some of them as a legal test case.

Judge Simon Grenfell made the threat as he dealt with about 75 claims by bank customers for refund of overdraft fees.

Originally, 250 cases were to be heard, but most were settled in advance.

Most of the remaining cases were settled in the claimants' favour, or with the banks being given more time to agree a deal.

"The court has an immense number of cases before it, as do courts across the country," said Judge Grenfell.

The threat by Judge Grenfell of forcing a legal test case over the issue of bank charges is likely to have rocked the banks.

In the past, across the UK, the banks have attempted to settle all the cases against them rather than willingly contest one before a judge, because they are afraid that a lost case might set a precedent.

That could see all the banks being forced to go back through their records for the past six years, repaying overdraft charges to every single customer who they have charged in that time.

Annoyance

Many of the 24 claimants, who attended the court in person, expressed annoyance at what they said were the delaying tactics used by their banks.

One bank - the Alliance & Leicester - declined even to attend the hearing and the judge said he might order the bank to come to court to explain its absence.

A barrister for Lloyds TSB admitted: "The solicitors are completely overawed by the number of cases before them."

More mass hearings of bank charges cases are scheduled for courts in England in the coming months, especially in London.






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