Brendan Burgess
Founder
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Bill Prasifka was on This Week today at 1 pm, and this is a transcript of what he said. He came on at around 1.45 if anyone needs to listen back to it.
How many cases?
Between July and Dec 2011: 100 cases about the type of mortgage and this would include trackers.
All cases are individual
We must look at the underlying documentation very clearly
Does it say that they are entitled to a lifetime tracker?
What happens when they fixed?
Sometimes the documentation is clear – this is a new agreement which supersedes the old agreement. Sometimes it does not say that.
We look at the original document and any amendment to it
Some documentation is very clear. The only thing which changes is that they go on a fixed rate for a short period. That is clear. The person is always entitled to their tracker back.
Some amending documentation clearly says that when the Fixed Rate is over, the only entitlement is the existing suite of products which the financial institution has. If trackers have been withdrawn by the financial institution, they would not be entitled to it
But the critical point for us – we look at the language. It has to be clear, Plain English which people can understand. In a recent high court case, that approach has been vindicated.
The judge ruled that clauses with huge implications for customers must be in plain English . it behoved the bank to spell out
And when they don’t?
The consequesnces are that people could be entitled to their trackers back. When we see that some of the ambiguity , when it is not spelt out clearly for the benefit of customers, we have been upholding the complaint.
The cases turn on the documentation not on the intent of the bank We read the documentation We read the language. We try to have a consistent approach with all of these cases and our decisions are legally binding
I have been surprised by the variety of documentation even within the same institution, where there are different agreements for the same basic issue.
When you rule against a bank for a customer with a particular mortgage and particular set of documents what should the bank do for customers with similar agreements and similar mortgages?
It is best practice that they should internalise the methodology and apply it across the board
Should they be contacting customers with similar agreements?
That is for the regulator and we are talking to them.
How many cases?
Between July and Dec 2011: 100 cases about the type of mortgage and this would include trackers.
All cases are individual
We must look at the underlying documentation very clearly
Does it say that they are entitled to a lifetime tracker?
What happens when they fixed?
Sometimes the documentation is clear – this is a new agreement which supersedes the old agreement. Sometimes it does not say that.
We look at the original document and any amendment to it
Some documentation is very clear. The only thing which changes is that they go on a fixed rate for a short period. That is clear. The person is always entitled to their tracker back.
Some amending documentation clearly says that when the Fixed Rate is over, the only entitlement is the existing suite of products which the financial institution has. If trackers have been withdrawn by the financial institution, they would not be entitled to it
But the critical point for us – we look at the language. It has to be clear, Plain English which people can understand. In a recent high court case, that approach has been vindicated.
The judge ruled that clauses with huge implications for customers must be in plain English . it behoved the bank to spell out
And when they don’t?
The consequesnces are that people could be entitled to their trackers back. When we see that some of the ambiguity , when it is not spelt out clearly for the benefit of customers, we have been upholding the complaint.
The cases turn on the documentation not on the intent of the bank We read the documentation We read the language. We try to have a consistent approach with all of these cases and our decisions are legally binding
I have been surprised by the variety of documentation even within the same institution, where there are different agreements for the same basic issue.
When you rule against a bank for a customer with a particular mortgage and particular set of documents what should the bank do for customers with similar agreements and similar mortgages?
It is best practice that they should internalise the methodology and apply it across the board
Should they be contacting customers with similar agreements?
That is for the regulator and we are talking to them.
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