AIB Taking a High Court case

[Brendan Burgess]

In this thread, I have identified the different cohorts whom I believe should go to the Ombudsman.

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But the majority of customers fall into the following cohort and it should be taken to court.

The We Want Trackers and Basic Compensation Cohort

This is the majority cohort where I think a court action should be taken.

You still have your mortgage with AIB or you have switched your mortgage without changing homes.

If you win your court case, you will get

1. Redress based on the 1.5% tracker from the date you came off the fixed rate. This could be up to 20% more
2. A tracker for the remaining term of your mortgage
3. Some basic compensation for being overcharged.

There is no facility for a class action in Irish courts, so each person would have to take their case individually.

However, it would be a good idea for those of you who want to go down this avenue, to get together and use the same solicitor and barrister.

The case will be heard from the beginning and the Ombudsman's decision will have no relevance.

You will have to prove
1) That there was a breach of contract
2) That there was a prevailing rate and it was 1.5% or lower
3) That you would have availed of it

I think that the chances of winning are good but it would be a very hard fought battle.


Brendan

 

[Brendan Burgess]

The legal system is very difficult, very expensive, very slow and very unpredictable and in Ireland.

So if you go down this route, brace yourself for a few years' frustration.

But someone needs to do it. If a judge rules that there was a prevailing rate and AIB should have offered it, I think that the Central Bank would tell AIB to apply it to everyone.

AIB is convinced that the Ombudsman made a huge error in ruling against it. It is confident that a judge would not arrive at the same conclusion.

However, I think that there is a good chance that a court would rule against AIB. Such a ruling would set a precedent for everyone else.

So AIB might well drag the cases out for as long as possible and then settle them with non disclosure agreements.

Twelve cases have already been lodged before the courts. These may be settled before they get to open court. The risk from everyone else's point of view, is that the case god to court, the borrower argues the case badly and loses. Then that would set a negative precedent for everyone else.

 

[Brendan Burgess]

One of you needs to take the lead on this and coordinate a group approach.

You could either take the case on behalf of the entire 5,600 cohort and insist on going to court and getting a decision.

Or you could just be prepared to settle on behalf of anyone who has subscribed to the group case.

Brendan

 

[coolaboola12]

If there are 12 cases already before the courts, is it not best to wait and see what happens with them ? And if they settle out of court then the rest of us load in ?

 

[Brendan Burgess]

Hi coola

1) You won't know if they settle.

2) You don't know the quality of the cases. The worst outcome is that they reach court, argue it badly, and get a decision against.

3) Even if AIB loses, they could argue that the case had special issues applying to just that case and that it would not be a precedent for anyone else.

But it's a bit of quandary ok.

Most people can sit back and do nothing and hope that someone else goes to the High Court and argues it well.

Brendan

 

[Lainey82]

One of you needs to take the lead on this and coordinate a group approach.

I have no great expertise either from a financial background or from a legal background but I’m happy to help out with planning and organising on this as much as I can. I too feel like this case deserves to go to court. Whether it wins or loses I really believe AIB need to be taken to task on their “legal” arguments, verified by “independent” third parties!!!!

Personally, what I would like to see happen is for about 200-300 of us each to put forward €1000 from our payouts to fund a high court campaign. Similar to Karen’s case being selected for the FSPO, a standard case with no anomalies or special circumstances should be selected to be put forward as the test case to go to the high court with. I believe a few caveats would be required with contributing to this fund. Firstly, the fund is to be used to bring the case before the high court, not just to the high court. What I mean by that is that there’s no settling on the steps beforehand unless AIB are willing to reinstate all the cohort on tracker rate of ECB + 1.5% and no NDA would be signed, it is highly unlikely that AIB would do this. As Brendan correctly pointed out there’s no guarantee that we will win this case but the individual monetary cost of this risk is hugely decreased to €1000, and that’s €1000 that we didn’t necessarily expect to have in the first place. The second caveat would be that although only one case would be selected to go forward, all who have contributed would have the choice to have some level of input into the decision making for the case or could opt to just be a silent contributor. I think it would be unfair if someone contributed and their case wasn’t selected to be put forward and they were completely left in the dark about decisions. However, I’m not completely sure how this might work considering there’d be 300 contributors, but at a minimum a general consensus on how this would work would need to be reached before people started contributing.

These are just my initial thoughts on taking a high court case. I am 100% onboard with supporting a high court action but would not be in a position to fund it myself. If there’s enough people willing to take this action and by grouping our money together we will have the ability to fund the campaign, I’m completely in. I’m also very happy to defer to other ideas on how best to go about this but I just thought I’d share my initial thoughts and see if others were thinking the same or did they have alternative ideas.

But I do think we need to get the ball rolling on this sooner rather than later. The cheques are fresh in our accounts (or hopefully en route to us which I’m hoping mine is!) and the money most likely has not found a home yet. As the saying goes “eaten pie is soon forgotten”, so in 2 months time €1000 may seem like a huge amount of money whereas now it won’t .

 

[Brendan Burgess]

Lainey

That is absolutely brilliant. Sums up and articulates my thoughts better than I can.

I particular - Risk €1,000 for a much more substantial gain.

This is the only bit I would advise against:

The second caveat would be that although only one case would be selected to go forward, all who have contributed would have the choice to have some level of input into the decision making for the case or could opt to just be a silent contributor.

It would be like herding cats. And you will get all sorts of bizarre opinions. "I paid my €1,000 so I want you to make the argument that there was a margin of 0% in my contract so that should be our case."

Set out the basis on which you are going to court. People either agree with this or take their own case.

Set up a small committee of maybe 3 to 5 people.

They will make the decisions.

The rest will have to trust them.

You can't update 100 people on the strategy as it will get back to AIB within a few minutes of the email being sent out.

No one else is bound by the decisions of the committee.

For example, if AIB offers a settlement, you might think it's a fair compromise and worth accepting rather than risk losing in court. They might say "Look we won't offer a tracker but we will increase the 12% write down to 20%". The committee would have to decide if that was reasonable or not.

 

[Brendan Burgess]

What I mean by that is that there’s no settling on the steps beforehand unless AIB are willing to reinstate all the cohort on tracker rate of ECB + 1.5%

That was my initial view on this if there is a High Court case, but my views have changed over the last week.

5,900 people are getting huge redress based on the work of about 100 of us at most. The other 5,800 have got a completely free ride.

If 200 of you do some more work and risk your money and time and AIB says "We will settle on the proposed terms for the 200 of you and a NDA", at this stage, I would probably think you should take it.

It would also mean that people would have an incentive to subscribe the €1000. "If you pay, you will be part of any settlement offer. If you don't, you won't."

Brendan

 

[Deeks1]

That was my initial view on this if there is a High Court case, but my views have changed over the last week.

5,900 people are getting huge redress based on the work of about 100 of us at most. The other 5,800 have got a completely free ride.

If 200 of you do some more work and risk your money and time and AIB says "We will settle on the proposed terms for the 200 of you and a NDA", at this stage, I would probably think you should take it.

It would also mean that people would have an incentive to subscribe the €1000. "If you pay, you will be part of any settlement offer. If you don't, you won't."

Brendan

Fully agree with the Brendan but would there be an issue whereby only the test case benefits due to the NDA?

 

[Brendan Burgess]

would there be an issue whereby only the test case benefits due to the NDA?

Good point.

It would have to be agreed up front that Karen Eile does not settle her case without the settlement being extended to the "subscribers".

Brendan

 

[Lainey82]

It would be like herding cats. And you will get all sorts of bizarre opinions.

This was something I would’ve been afraid of but still feel that a full strategy should be set out and agreed upon before people contribute. I don’t mean legal strategy but more what the group strategy is. I like your idea of setting up a committee. I think you could have the vast majority involved at the beginning and perhaps everyone could then have their say on who the chosen committee should be

No one else is bound by the decisions of the committee.

For example, if AIB offers a settlement, you might think it's a fair compromise and worth accepting rather than risk losing in court. They might say "Look we won't offer a tracker but we will increase the 12% write down to 20%". The committee would have to decide if that was reasonable or not.

I don’t necessarily agree with this. I think, and this is completely how I feel about the situation, that I’d happily pay €1000 to see AIB have to stand up in court and argue their case. Even we lose it’d be nice to return the favour they’ve bestowed upon us and absolutely hold out until the last. I feel they deserve to be brought to court just on how unethical and immoral they’ve been throughout this whole process. I don’t think people will ever be in such a strong position (provided we get 300 people to buy in) to see a case through to the last because the loss vs benefit risk is practically negligible - €1000 to ensure AIB have to defend themselves in high court, for me even if the case is lost I will still see my €1000 as one of my best investments and it will give me great satisfaction!!! I feel like you have had the David and Goliath battle with AIB and now it’s our turn to band together and try and win the war!!!

Also, I think making sure it goes to court and is ruled upon, whether it’s a win or a lose, will take away an awful lot of uncertainty for others in the future and will ensure a precedent is set either way.

 

[Lainey82]

5,900 people are getting huge redress based on the work of about 100 of us at most. The other 5,800 have got a completely free ride.

If 200 of you do some more work and risk your money and time and AIB says "We will settle on the proposed terms for the 200 of you and a NDA", at this stage, I would probably think you should take it.

It would also mean that people would have an incentive to subscribe the €1000. "If you pay, you will be part of any settlement offer. If you don't, you won't."

Really valid points, and I can’t disagree with what you’re saying. I suppose I’m being a bit of an idealist!!! That’s your Trojan work on this case rubbing off on me Brendan!

 

[KurtKasino]

I have no great expertise either from a financial background or from a legal background but I’m happy to help out with planning and organising on this as much as I can. I too feel like this case deserves to go to court. Whether it wins or loses I really believe AIB need to be taken to task on their “legal” arguments, verified by “independent” third parties!!!!

Personally, what I would like to see happen is for about 200-300 of us each to put forward €1000 from our payouts to fund a high court campaign. Similar to Karen’s case being selected for the FSPO, a standard case with no anomalies or special circumstances should be selected to be put forward as the test case to go to the high court with. I believe a few caveats would be required with contributing to this fund. Firstly, the fund is to be used to bring the case before the high court, not just to the high court. What I mean by that is that there’s no settling on the steps beforehand unless AIB are willing to reinstate all the cohort on tracker rate of ECB + 1.5% and no NDA would be signed, it is highly unlikely that AIB would do this. As Brendan correctly pointed out there’s no guarantee that we will win this case but the individual monetary cost of this risk is hugely decreased to €1000, and that’s €1000 that we didn’t necessarily expect to have in the first place. The second caveat would be that although only one case would be selected to go forward, all who have contributed would have the choice to have some level of input into the decision making for the case or could opt to just be a silent contributor. I think it would be unfair if someone contributed and their case wasn’t selected to be put forward and they were completely left in the dark about decisions. However, I’m not completely sure how this might work considering there’d be 300 contributors, but at a minimum a general consensus on how this would work would need to be reached before people started contributing.

These are just my initial thoughts on taking a high court case. I am 100% onboard with supporting a high court action but would not be in a position to fund it myself. If there’s enough people willing to take this action and by grouping our money together we will have the ability to fund the campaign, I’m completely in. I’m also very happy to defer to other ideas on how best to go about this but I just thought I’d share my initial thoughts and see if others were thinking the same or did they have alternative ideas.

But I do think we need to get the ball rolling on this sooner rather than later. The cheques are fresh in our accounts (or hopefully en route to us which I’m hoping mine is!) and the money most likely has not found a home yet. As the saying goes “eaten pie is soon forgotten”, so in 2 months time €1000 may seem like a huge amount of money whereas now it won’t .

Thanks Lainey, you can count me in for this. The more I think about it this simple interest issue is AIB giving two fingers to us and indeed the ombudsman, their attitude stinks and they need to be held to account

 

[Brendan Burgess]

Also, I think making sure it goes to court and is ruled upon, whether it’s a win or a lose, will take away an awful lot of uncertainty for others in the future and will ensure a precedent is set either way.

I fully understand this and it certainly was my original view. But the committee should decide.

I doubt you could force AIB into court.

Presumably if you make a claim, they can settle it in full and avoid court.

While that would not create a legally binding settlement, you would not be tied into a non disclosure agreement and so you could encourage others.

You could also send it to the Central Bank who might tell AIB to implement it for the cohort.

In practical terms, if you get a generous settlement offer for the 200, then it would be very hard to turn it down.

Brendan

 

[Megafan]

That was my initial view on this if there is a High Court case, but my views have changed over the last week.

5,900 people are getting huge redress based on the work of about 100 of us at most. The other 5,800 have got a completely free ride.

If 200 of you do some more work and risk your money and time and AIB says "We will settle on the proposed terms for the 200 of you and a NDA", at this stage, I would probably think you should take it.

It would also mean that people would have an incentive to subscribe the €1000. "If you pay, you will be part of any settlement offer. If you don't, you won't."

Brendan

Hi Brendan

Just on the above, and your other posts on this, the herding cats analogy is perfect because of the diverse range of opinions and levels of annoyance over the actions of AIB.

Going back on when the initial group went to get legal advise some years back, does that group exist in any form still and have an opinion on whether it is something to pursue further? I remember reading posts from someone saying initially there was good engagement but numbers fell away, when there was absolutely no chance of anything.

It is no small thing to make that kind of commitment, even to decide on a particular legal team, pick a suitable test case, prove there was a service breach, prove the prevailing rate was 1.5%, have a strict understanding of what being on a committee would be, versus being part of a wider group of people, how to co-ordinate the cash element, have binding docs on rolling in behind the lead case and they are just some of the things at the top of my head.

Basically, it would need a lot of substance and a figurehead which the FSPO process had in yourself, but I expect legal approaches are behind closed doors more so.

It would seem to need to be led by a solicitor to set the criteria and everyone row in behind it and you are talking maybe years before it got traction. No small thing.

 

[Brendan Burgess]

Just on the above, and your other posts on this, the herding cats analogy is perfect because of the diverse range of opinions and levels of annoyance over the actions of AIB.

And there would be different circumstances as well. If someone faced repossession, they would not accept the same deal as the vast majority who were just inconvenienced a bit.

That wouldn't matter so much if the lead case was not looking for compensation.

Brendan

 

[Megafan]

And there would be different circumstances as well. If someone faced repossession, they would not accept the same deal as the vast majority who were just inconvenienced a bit.

That wouldn't matter so much if the lead case was not looking for compensation.

Brendan

Then you are talking ever decreasing circles really, without huge engagement across the unknowing cohort so you could afford to lose people out of a grouping. Which AIB are depending on.

I always thought that post the judgement, it is on the margins that people could take further action due the lack of clarity on the prevailing rate but maybe you could meet the right judge on the right day.

On a lesser scale AIB have given the window for further compensation as such by calculating interest @ simple versus compound. If everyone was under paid by up to €3k as an example they would easily make that right for the €5,600 costing an additional €15/16mnmn or whatever, that is just a rounding number in the greater scheme of things.

 

[Clareseapoint]

I don't have much financial or legal knowledge, but I feel this was our hard earned money from the beginning, and we should at least be offered a lower interest rate for the remainder of our mortgage, thanks Brendan for everything you did, greatly appreciated. We would be happy to subscribe, as we had to take a mortgage break in March this year, and during the recession after 2008 we struggled financially and emotionally. The cheque received yesterday was a welcome gift

 

[krockroc]

HI Brendan,

happy to contribute €1k too. Win or lose, keeping this in the public eye is important.

 

[Brianios]

Hi,

I would be happy to contribute €1000 to this also. I don't know all the ins and outs of this whole thing but it is clear AIB are doing the least they can to try to put it behind them. They really are a disgrace of a bank. Their owners should be ashamed.. oh wait!!