This is Money - Bank charges verdict to finally arrive

The High Court is due to give its verdict today on the appeal made by eight High Street banks against its ruling on bank charges last year.

The appeal case, started in October of last year, is an attempt by the banks to overturn the decision made by the Court that punitive bank charges can be assessed for fairness by the Office of Fair Trading (OFT).

If the banks lose the appeal, bank customers will not be able to reclaim their charges immediately, but the OFT will have the green light to assess bank charges for fairness under the Unfair Terms in Consumer Contract (UTCCR) regulations.

If they find the charges are unfair, customers should then be able to reclaim from their bank, this follows a hold put on reclaiming since the case was announced in summer 2007.

If the banks win, it could spell the end of the entire consumer battle to reclaim billions in unfair bank charges.

That is if both parties decide not to appeal the decision yet again, however.

The banks could put in another appeal to the House of Lords should they lose a second time, which would drag any potential end to the case into 2011. If the OFT loses, it is likely it will get the opportunity to question the appeal decision.

Marc Gander, head of the bank charges lobby organisation Consumer Action Group, said he is sure the OFT will be given this option.

He said: 'I'm sure the judge would grant the OFT the right to appeal in the very unlikely event it loses. It would even things up: each side would then have appealed one of its rulings.

'The only thing that would stop the banks appealing is their public image. To drag this on yet another year by taking it to the House of Lords after delaying the case a year already, I think would mark them out as the people's enemy when their reputation is bad enough already.

'I'm not sure they would have the gall to do that. They may be so reluctant to draw this on that they may throw the towel in.'

A spokesperson for the British Bankers' Association said they didn't want to second-guess the case before the judgment tomorrow. The OFT also declined to state how it will act depending on the announcement.

The OFT announced originally it was taking the High Street banks to court in July 2007 after a wave of public disquiet over bank charges, which could be up to £38 for a minor incursion into an unauthorised overdraft.

The Financial Services Authority granted banks a waiver at this time, allowing them to put all claims on hold until the OFT test case in the High Court is completed. All reclaims have been stalled until the High Court case has been settled, unless a customer can prove they are suffering from financial hardship as a result of the charges.

Either side of the battle has the right to take the case to the High Court, followed by the European Courts until they could be forced to cede defeat. If so, it could take years for the case to conclude.

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