Thursday 29 September 2016

'Couple overcharged by €61,000 on PTSB mortgage rejects bank’s 'derisory' €6,000 compensation offer'

By Aodhan O'Faolain & Ray Managh

Published 07/08/2015 | 14:23

The couple from Lusk in Co Dublin were told in late July they had been overcharged by more than €61,000 by PTSB in respect of a mortgage relating to their current and previous family homes for a period in excess of six years.
The couple from Lusk in Co Dublin were told in late July they had been overcharged by more than €61,000 by PTSB in respect of a mortgage relating to their current and previous family homes for a period in excess of six years.

Permanent TSB has told a couple they must accept the bank’s “derisory” €6,000 offer of compensation before it will repay €61,000 it overcharged them on their mortgage, the High Court heard today.

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Liam Fitzgerald and Angela Wallace are among 1100 customers of Permanent TSB who, a Central Bank investigation found, were overcharged and they are suing the bank for damages.

The couple from Lusk in Co Dublin were told in late July they had been overcharged by more than €61,000 by PTSB in respect of a mortgage relating to their current and previous family homes for a period in excess of six years.

Fitzgerald and Wallace claim the bank had written to say it would repay what it had overcharged them, but subject to their accepting PTSB's offer of compensation of €5,798.92. 

Mr Justice Robert Haughton heard the couple had always abided by their mortgage terms with PTSB.  The couple told him in an affidavit it was “utterly improper and unlawful” for the bank to place such a condition on the repayment of money PTSB had admitted was due and owing to them.

They told the court they were being asked to accept a "derisory compensation offer.”

In their High Court action against Permanent TSB Plc they sought an injunction requiring PTSB to discharge its admitted liability in the sum of €61,195.13. They also seek damages for alleged breach of contract and unlawful interference with their economic interests as well as punitive and exemplary damages.

Judge Haughton granted an ex parte application to serve short notice of an application for various injunctive orders against the bank. He said that given the issues involved t was more appropriate to deal with the application when the bank was represented. The matter was adjourned until next Thursday.

Fitzgerald, a solicitor, of Perrin Way, Lusk Village, said in an affidavit that it was "utterly reprehensible" PTSB had not unequivocally offered to “immediately and without question" repay him and his wife the amount they were overcharged.

He said there was no legal basis for refusing to pay the sums overcharged. The condition that they accept the offer of compensation before they could get back the amount overcharged was a disgraceful requirement.

Mr Fitzgerald said the overcharge had caused him and his family financial pressures in order to meet the mortgage repayments.  His family had to make sacrifices and he had to "beg and borrow sums of money from family members" to maintain the upkeep of his home. 

He said they had no savings and none of these difficulties would have been encountered by his family had they not been overcharged by the lender.

The compensation offer had represented a mere 9% of the money they were deprived of for the time they were overcharged, which worked out at 1.5% per annum. At an absolute minimum he felt they ought to be compensated at the Courts Act Interest Rate of 8% per annum.

In its investigation the Central Bank found PTSB failed to inform certain customers of the consequences of their decisions to break early from a fixed rate or discounted tracker period which had seen them lose their contractual right to a tracker rate in the future.

The Central Bank also found PTSB failed to inform other customers of their right to a  tracker rate at the end of any fixed rate period.  Another mortgage provider, Springboard, was also found by the Central Bank to have overcharged some 220 customer accounts. 

The investigation said the lender's failures were a key factor in the loss of ownership of at least 22 properties.

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