Lloyds TSB wins bank charge case

Lloyds TSB has become the first bank to defeat a court challenge by a current account customer over unauthorised overdraft penalty fees.

A district judge at Birmingham County Court dismissed a claim for more than £2,000 in fees and interest on the grounds that charges levied by the bank were a legitimate part of the service.

The verdict will come as a blow to thousands of people still hoping to reclaim "unfair" charges from their bank.

But campaigners noted that the ruling was made by a district judge and as such was not binding in the way that a High Court judgement would be.

The case involved a claim for £1982.37 in fees and additional interest made by Lloyds TSB customer Kevin Berwick.

Mr Berwick argued that Lloyds TSB's charges for going over an agreed overdraft limit were unreasonably high - sometimes up to £30 - and as such he should be reimbursed for money taken from his account in relation to them.

In filing the claim, Mr Berwick's actions were in line with thousands of UK bank customers who have successfully claimed against their current account provider - usually without the matter coming to court.

But unlike most other cases, Lloyds TSB were unable to reach a settlement out of court after Mr Berwick refused their offer, giving a judge the opportunity to rule on the legality of charges for possibly the first time.

District Judge Cook said that Mr Berwick failed to satisfy the court that he had any ground in law to recover the charges, and dismissed the claim.

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