High Court Action - taking a bank into the High Court

[HighCourtAction]

Hi all, Wondering whether anyone has experience of taking a bank into the High Court. I had a business which was over-charged leading to it's closure, I lost everything, I have a forensic accountants report to show how the business could have avoided closure had the bank returned the over-charged amount. Finding it hard to find any examples on-line so any help appreciated.

 

[john luc]

I had a case similar but as severe as your one with AIB. I went the accountant to bank manager approach which was less argumentative than the legal route. They were happy to gave in quickly and began offering me compensation. I as was my right kept refusing until they reached their top number then we were at an impasse so I was then able to engage the ombudsmen. They hated that. He spent 3 months and found in my favour and threw on a few more Bob to break the ice. I took it, had my case on the ombudsmen end of year report and then continued to trade my business with A IN because they now had a BIG flag on my a/c to say, DON'T MESS WITH THIS A/C AGAIN.
best year of my trading life that was.

 

[HighCourtAction]

Hi John Luc, Glad to hear it went well, unfortunately for me I had already placed the business into liquidation, it was the day of the newspaper notice that they called to say they owed me money ! I'll just have to wait for the solicitors etc to sort it.

 

[Jim2007]

I have a forensic accountants report to show how the business could have avoided closure had the bank returned the over-charged amount.

It would have to be one hell of an over-charge to convince any court that that alone would have prevented the business from failing. And most of those forensic accountant's reports I have seen don't stand up very well in court if they are trying to predict what the future might have been - far too many assumptions for the defence to attack.

My advice would be to very carefully control the costs of such an action if you do decide to go to court.

 

[HighCourtAction]

Thanks Jim, I understand your comment regarding the ''future'' which no one could predict, however the report merely confirms that had the refund been made (when the opportunity presented itself to the bank) the business would not have exceeded it's banking facilities and would have continued to trade. In any case your point to the issue of costs is in hand. Thanks again.

 

[Palerider]

If your audited historic and recent accounts do not support your position you will lose, there are so many factors influencing the success of any business that I cannot see you prevail especially as the overcharge could not be in the tens of thousands or could it ?

 

[Jim2007]

Thanks Jim, I understand your comment regarding the ''future'' which no one could predict, however the report merely confirms that had the refund been made (when the opportunity presented itself to the bank) the business would not have exceeded it's banking facilities and would have continued to trade. In any case your point to the issue of costs is in hand. Thanks again.

That is not going to get you very far, you would need to show that you were generating and growing cash flow, otherwise it will just be argued that refund would have be just postponed the close down and if you had the cash flow it will be argued that you did not need the refund to continue.....

 

[HighCourtAction]

Hi Palerider and Jim2007, all told the business was due a refund of 15000 euro, to give you an example I once purchased 7500 euro worth of product and turned it into net sales of 80000 euro, who's to say that what would have happened or not, what I do know is the business had trimmed its overheads dramatically, reduced staff to one, rented out office and warehouse and would have continued to generate cash, I know this because after the closure I continued as a sole trader. To revert back to my original post I guess there are few if any examples of this scenario. I did find one which is on-line with a case which led to a 6 figure compensation however in this case the business was not lost.

 

[Jim2007]

Hi Palerider and Jim2007, all told the business was due a refund of 15000 euro, to give you an example I once purchased 7500 euro worth of product and turned it into net sales of 80000 euro, who's to say that what would have happened or not

Nobody. It is purely hypothetical, you might as well argue that had you spent the money on lotto tickets you’d have won. It will make no difference to your case.

what I do know is the business had trimmed its overheads dramatically, reduced staff to one, rented out office and warehouse and would have continued to generate cash,

You have just described the typical failing business. It would not need to do those things if it was a cash generator. The 15k would have only prolonged the agony, that will be the defense.

To revert back to my original post I guess there are few if any examples of this scenario. I did find one which is on-line with a case which led to a 6 figure compensation however in this case the business was not lost.

There is nothing concrete in your case and in most such cases people would not be willing to put up the cash to take legal action. Remember if you loose, you most likely end up paying the defense costs as well. And I expect in most situations owners of a failed business would not have the case to take such cases.

 

[Palerider]

I don't mean to be disrespectful so I won't be, move on with your life, save your hard earned, you have no idea how the costs will rise as they drag you out with disclosure after disclosure, forget about it, you will not succeed.

 

[HighCourtAction]

Hi Palerider, I would love to move on without this ''stone in my shoe'', however said bank have me and my ex wife in a difficult place, we had purchased a commercial building which is now in heavy negative equity which was leased to the business, the only leverage I have is this case. Legals have said that I have breach of contract, negligence, breach of duty etc etc so I feel I have to see this through.

 

[Jim2007]

Hi Palerider, I would love to move on without this ''stone in my shoe'', however said bank have me and my ex wife in a difficult place, we had purchased a commercial building which is now in heavy negative equity which was leased to the business, the only leverage I have is this case. Legals have said that I have breach of contract, negligence, breach of duty etc etc so I feel I have to see this through.

Can you clarify a couple of things for me:
- was the business a company?
- If so was the bank refund due to the company or you?
- Does the company still exist?
- Did the company cease trading debt free?

 

[HighCourtAction]

Hi Jim2007, The business was Ltd, refund was due to the company, the company was liquidated with debts owing to suppliers and revenue.

 

[Palerider]

The heavy negative equity as you describe it is not the Banks fault.

Your business failed with debts owing to suppliers and revenue.

I bet more than €15000.

I guess you have your point of view, mine differs, you will not succeed and could dig yourself in even deeper, such is life, good luck to you regardless.

 

[Jim2007]

Hi Jim2007, The business was Ltd, refund was due to the company, the company was liquidated with debts owing to suppliers and revenue.

I have is this case. Legals have said that I have breach of contract, negligence, breach of duty etc etc so I feel I have to see this through.

Are you seriously telling us that a solicitor is advising you to take the bank to the High Court in circumstance where the company that had the contract with the bank no longer exists and in any case any damages recovered by the company would have gone to the Revenue in the first instance? One has to assume that the liquidator looked at this option and discounted it as a waste of time and money...

The very first thing you would need to establish is how you have a right to take the bank to court in the first place given that you were not party to the contract between the company and the bank...

Honestly I think you would be better served investing whatever cash you have in your new business rather that spend it on this... but it's your money.

 

[NoRegretsCoyote]

What was the bank charging you for?

€15k is a lot of transactions for a business that failed for a want of €15k.

 

[mtk]

Wont even getting as far as high court mean legal fees > 15k in any case ......and you may lose and have to pay other sides costs....
AFAIK dont lower courts deal with low value 15k cases ? ( but I am not a legal person !)

 

[Palerider]

Wont even getting as far as high court mean legal fees > 15k in any case ......and you may lose and have to pay other sides costs....
AFAIK dont lower courts deal with low value 15k cases ? ( but I am not a legal person !)

Good point and shows how poorly advised the OP is in this.

 

[Leo]

I once purchased 7500 euro worth of product and turned it into net sales of 80000 euro

One danger with introducing this arguments is the question of why you were unable to purchase €1,000 of stock and turn it into >€10k sales, then take those proceeds and repeat.... If a margin of that size was repeatable, €15k shouldn't have been an issue.

 

[DirectDevil]

Just a few basic observations.

1. PROOF.

OP carries the burden of proof here.
OP must show that the conduct of the bank was directly responsible for causing the loss absent other possible contributory or intermediate interfering factors such as trading conditions and the like.

2. STANDARD OF PROOF.

The standard of proof is the balance of probabilities i.e. at least 51% more likely than not to be correct.

3. SECURITY FOR COSTS.

I hope that OP's solicitor has explained clearly the concept of security for costs.
In some cases a defendant may request that the plaintiff shall deposit a sum of money against the contingency of the action being lost and the defendant not being able otherwise to recover any costs awarded.
Where the plaintiff is effectively an entity in liquidation that would probably be a fair target for such an application.
The defendant must actually seek and obtain a court order for security of costs.
The Master would usually deal with the application and decide, on the merits, what orders if any to make.
If the Master thought the plaintiff's case to be of highly uncertain merit an order for security of costs would probably issue.
Obtaining an order for security of costs can be a very effective way of killing an action stone dead.

Unkind though it may sound OP may need to decide at some point to cut his losses before incurring financial liabilities.
That said, give it as good a shake as you can before running in to heavy costs.