Aniekan Mary Boyo v Lloyds Bank Plc
| Jurisdiction | England & Wales |
| Judge | Anthony Metzer |
| Judgment Date | 23 August 2019 |
| Neutral Citation | [2019] EWHC 2279 (QB) |
| Court | Queen's Bench Division |
| Docket Number | Case No: HQ17X02945 |
| Date | 23 August 2019 |
[2019] EWHC 2279 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Anthony Metzer QC sitting as a Deputy Judge of the High Court
Case No: HQ17X02945
The Claimant appearing in person with a McKenzie Friend, her father, Christopher Boyo
The Defendant represented by Mr Lee Finch of Counsel, (instructed by TLT Solicitors)
Hearing dates: 9 th and 10 th July 2019
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
The Claim and Background Circumstances
The Claimant has brought proceedings against the Defendant for defamation (including malicious falsehood); breach of contract and breach of common law duty in respect of a report that the Defendant made to Credit References Agencies which the Defendant maintains took place in January 2013 in relation to an overdraft on the Claimant's student current account.
The Claimant held three accounts with the Defendant's banking group – The Student Current Account with the Defendant which I shall refer to as “The Account” was overdrawn in the sum of £987.84 as at 9 August 2012 but she also had two accounts with the Halifax, one of which was £3,795 in credit and the other £117 in credit. The Halifax was part of the Lloyds Banking Group but was structurally a separate entity.
On 9 August 2012, the Defendant wrote to the Claimant (Trial Bundle P47) stating:
“Recent risk assessment on your accounts has highlighted concerns and as a result we have taken the decision to close all the accounts you currently hold with us in two months' time. The two-month notice period is set out in our terms and conditions and starts from the date of this letter. In the meantime, I have placed a block on all of your accounts to stop all transactions. You will need to make other arrangements for any credits, direct debits or standing orders set up on your accounts as no further payments will be made …
“If you are in debt with us on any of your accounts you will need to make arrangements to repay the outstanding balance owed to us. We understand that it may not always be possible for you to repay the full amount within two months. If this is the case, you need to visit one of our branches to discuss this further. Please make sure you take this letter with you as a reference”.
As a result, the account was blocked as were the Claimant's two other accounts with Halifax.
It appears from Paragraph 7 of Mr Richard Cox's witness statement who gave evidence for the Defendant and was not challenged on this that the reason for blocking the account was “because of concerns over the Claimant's conduct of the three accounts”. When he gave oral evidence Mr Cox indicated that at the time there was a suspicion of fraud but was keen to make clear that he was not alleging the Claimant (or anyone connected with her) had carried out any fraudulent activity.
The Claimant who was a student at the time was extremely concerned by the letter in consequence of the accounts being frozen and made a complaint. (There is some dispute as to whether that was oral or at a meeting with her father and a representative of the Defendant) – which prompted a further letter from the Defendant dated 14 August 2012 in which the Defendant apologised for the inconvenience caused to the Claimant and reminded her of its terms and conditions when the Claimant had opened her account with the Defendant and informed her that the letter gave the Claimant two months' notice to make other banking arrangements and stating that if the Claimant had not closed her account within that period, a cheque would be sent for the remaining balance whereas if she was overdrawn she would need to repay what she owed by the date shown on the letter. The letter concluded by informing the Claimant that she had the right to contact the Financial Ombudsman Service (FOS) within six months.
The Claimant together with her father who assisted her in all material regards, did lodge a formal complain to the FOS on 18 September 2012 but on 26 October 2012, the FOS confirmed that the complaint was not upheld and that as a consequence the Defendant was not required to reinstate the Claimant's bank account. At Page 423(2) of the Trial Bundle, the FOS stated:
“Whilst it is appreciated Ms Boyo's frustration with this matter, Lloyds TSB's decision to close her account is a legitimate exercise of its commercial judgment. This is not something with the Financial Ombudsman Service ordinarily investigates and it is not appropriate to do so in this case. The decision is in line with the terms and conditions of the account and therefore there is insufficient evidence of a bank error”.
The Claimant then wrote further letters both to the Defendant on 15 October 2016 and to Moorcroft Debt Recovery Limited, whom the Claimant agreed was acting on behalf of the Defendant, on 14 October 2016, essentially as Pre-Action Protocol (PAP) letters. Moorcroft Debt Recovery Limited responded on 18 October 2016 making clear that any default applied to the Claimant's credit file would be done by the client (the Defendant).
The Defendant responded on 26 October 2016 (Trial Bundle page 66) which stated:
“Where we cannot return an account to order with the customer or no payments are received, we take a decision to close an account and transfer the outstanding balance to Recoveries. Our records show that your account was closed on 4 January 2013 and the sum of £1,080.90 transferred to Recoveries.
For clarity, the benefit to customers when this action is taken is that no further interest and charges are applied; however a default is recorded which remains on your credit file for a period of six years”.
The Claimant responded with further letters on 3 November 2016 in which she threatened proceedings would be instigated by 18 November 2016 to which Lloyds responded as follows:
“After reading your further comments, I can confirm that a Formal Demand letter was sent to you on 4 December 2012. This notified you that your account would be closed and that a default would be applied to your credit file unless you cleared the arrears or came to an arrangement with us. Our records show you called us on 12 December 2012 and confirmed you had received our letter. I am therefore unsure why you feel we have failed to notify you of the consequences of not repaying the amount owed to the bank.
“I have already explained the default was correctly applied to your credit file when your account was closed and transferred to Recoveries on 4 January 2013. It will remain on your credit file for a period of six years, no mistake has been made in this regard”.
The Claimant wrote again on 3 January 2017 confirmed that she did not receive a Formal Demand on 4 December 2012 and denied calling the Defendant on 12 December 2012. She wrote again on 7 February 2017 to which the Defendant responded on 10 February 2017 in which the Defendant (then) maintained:
“As part of the closure process in relation to the above account, we issued a Default Notice. Our Default Notice letters are computer produced and we are not obliged to retain a copy of these. Our records show that this letter was issued by first-class mail to you on 4 December 2012 and this was not returned as undelivered. I believe, therefore, that it is correct for us to consider that this legal document should be deemed as served”.
The Claimant wrote a further letter as part of Pre-Action Protocol on 3 March 2017 and issued proceedings on 14 August 2017. The amended Particulars of Claim was served on 7 November 2017 to which there was a response by Defence dated 4 December 2017. The Defendant made a Part 18 CPR request on 8 August 2018 to which the Claimant responded.
As indicated above, the claims instigated by the Claimant comprise defamation, breach of contract and breach of common law duty. The Defendant denied all the causes of action maintaining in respect of defamation that the report was accurate; that the Claimant consented to the reporting; that the report to the Credit Reference Agency was covered by common law qualified privilege; and that the Defamation claim was time-barred under Section 4 of the Limitation Act 1980. In respect of the breaches of contract / common law duty, the Defendant denied any breach of any contractual obligation or common law duty.
The Claimant seeks substantial damages from the Defendant and made an application to increase the value of her claim from around £440,000 to around £1,900,000. That application remains outstanding to be dealt with at the end of a trial of a number of preliminary issues following the order of Deputy Master Leslie on 3 December 2018 in which he ordered a trial on three preliminary questions:
(1) Does the Claimant have any defamation or malicious falsehood claim against the Defendant;
(2) Has the Defendant breached its contract with the Claimant;
(3) Has the Defendant breached any common law duty it owed to the Claimant?
Were all three questions to be answered in the negative, the claim would fail and therefore any questions of quantum would not arise.
Trial Management
The Claimant has been assisted throughout by her father, Christopher Boyo. He was permitted to address the court at all stages with the leave of various masters and represented the Claimant in her successful opposition to the Defendant's application for summary judgment to dismiss the claim or strike out or dismiss individual parts of it before Deputy Master Bard gave judgment on 12 July 2018. Mr Boyo was a witness of fact relied upon by the Claimant and provided a witness statement dated 6 March 2019. The matter was canvassed before me and...
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