Property118 Members vs West Bromwich Mortgage Company

Property118 Members vs West Bromwich Mortgage Company

10:25 AM, 3rd March 2014, About 9 years ago

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UPDATE – 31st March 2014

Since publishing this article our campaign has raised over £450,000 and legal action has now commenced. The official closing date for borrowers to be represented in this action was 28th March 2014. However, it may still be possible to be included in the representative action by paying additional fees to cover administration and Court fees to be added to the list of represented claimants. For further details please Contact Carla Morris-Papps at Cotswold Barristers – telephone 01242 639 454 or email

West Brom Tracker Mortgages

Property118 Members vs West Bromwich Mortgage Company

Property118 Members vs West Bromwich Mortgage Company

Borrowers representing 84 mortgage accounts affected by the West Bromwich Mortgage Company 1.9% rake hike to their tracker rate mortgage margins attended a secret meeting of paid up campaign members on 27th February 2014. At that meeting it was confirmed that 420 affected mortgages are currently represented by the campaign group.

Property118 had previously created a secure forum for paid up members of the group to discuss various legal strategies, one of which was a proposal to West Brom to consider arbitration as an alternative to Court action. Each member had paid £240 for each affected mortgage plus a contribution to a campaign marketing campaign.

Arbitration was proposed for tactical legal reasons which were explained by the groups advisers, some details of which must remain confidential for legal reasons.

This would have been significantly quicker and cheaper for all concerned and had massive upsides to West Brom in that the outcome would be confidential. In other words, if West Brom had lost the case, nobody would have “officially” known about it other than those who had already paid to be a member of the campaign group. This would have meant the worst case scenario for West Brom would be losing no more than 10% of their reported £19 million of additional annual profits from this rate hike.

West Brom refused!

This refusal now plays very nicely into our hands for litigation purposes as it will be frowned upon by the Courts, especially if we lose our case and end up having to pay costs associated with the David and Goliath battle. 😉

The attendees of the meeting voted unanimously to proceed immediately with litigation on the basis proposed by (Mark Smith – Barrister-At-Law) as explained below. Thanks were offered to Justin Selig and his team at The Law Department for his sterling work to date in helping us get to this position. Without their help our campaign may never have got this far.

Litigation will commence during the week of 31st March 2014 with the service of Court Papers. This provides a final opportunity for any remaining affected borrowers to commit to the action by Friday 28th March.

We already have more than double the necessary funds on account to pay our own legal team. Mark Smith has agreed to represent borrowers for a fixed fee of £120 + VAT per affected mortgage subject to there being at least 250 borrowers committed. Further details in his Terms of Business and Instruction letter which can be downloaded by completing the form at the bottom of this page.

Existing campaign members are also reminded that they MUST complete and return the instruction form  to Mark Smith to act for them and the required additional funds by 28th March 2014.

The deadline for submission of instructions has now expired, sorry.

Costs Funding

The primary concern of existing members that had to be overcome was their potentially unlimited liability to the West Brom’s legal costs in the event of losing the case and the “open cheque book” often associated with legal cases. It was agreed that all fears could be overcome by creating a fund to be held in a BARCO escrow account (BARCO is the Bar Council – the regulators of Barristers). This account will provide evidence to the Courts that we have sufficient funds on account to settle the other sides costs in the event of losing the case and having an adverse costs order awarded against the group.

The first step of the legal action will be a costs hearing, as part of a “Case Management Conference”. This is where both sides must submit their costs budgets for the case to the judge and where the judge decides upon reasonableness. If either side fails to do this then the maximum they can claim for costs against the other side is the Court fee, i.e. £175! It is extremely rare for judges to award costs in excess of the agreed costs budget.

Our estimate is that based on the number of affected mortgages being represented, and the possibility of more people now wishing to be represented at this stage, the BARCO account could contain as much as double the other sides costs budget. This is why we are so confident about costs not exceeding the amount of funds that will be held in escrow. In the extremely unlikely event of the groups funds being insufficient to meet a potential costs order the group would have an opportunity to withdraw their case and settle the other sides costs to date.

If/when we win, the contents of the BARCO account will be rolled over to deal with all of the costs associated with the inevitable appeal case and if/when that is won the funds will be returned to members. If we lose, the contents of the escrow account will be used to pay costs awarded to West Brom and the balance of funds will be returned pro-rata to members.

The case will be fought on the basis of a representative action. This means that the ruling of the Courts will only apply to those borrowers who have paid to be represented in the case. There will be no free rides!

We fully appreciate that some affected borrowers will not be able to raise the necessary funds in time to be part of this action so there is a Plan B. Affected borrowers who are not represented may have another opportunity to make claims in a few years time. In the meantime they will continue to pay the higher rate and will probably be expected to forfeit any refund of overpayments in return for a no-win-no-fee arrangement. This could be a far more expensive option, hence the reason why so many affected borrowers are so keen to be part of the imminent legal action.

The legal strategy and process we are undertaking will be a very simple one. There will be no witnesses called so there will be no surprise twists such as those often seen on TV where a new witness or new evidence appears at the last minute. On this basis, we anticipate the case, including any appeal, to be concluded before Christmas.

We will only be asking the Courts to rule on two things:-

1) Based on the documentation produced by West Brom, do they have the right to increase the tracker margin?

2) Based on the documentation produced by West Brom, do they have the right to call in loans within 28 days without the borrower being in default?

There has been lots of discussion about whether West Brom did or did not provide all of the documentation they are now relying upon. This is not relevant to our case.

There has also been much discussion about Unfair Terms in Consumer Contract Regulations; again this is not relevant to our case.

It has been questioned whether in fact the mortgages issued by West Brom were indeed trackers, this cannot be denied by West Brom as this is the basis they report them to the rating standards agencies – see this link

The agreed level of funds to be deposited into the BARCO account is £1,144 per affected mortgage being represented. For example, somebody wishing to have 10 affected mortgages represented will need to deposit a further £11,440 into the BARCO account. Existing members will receive a refund of unused funds which they paid into the client account of The Law Department. New members will need to pay an additional premium of £356 per mortgage to the Property118 marketing fund to equalise the financial contributions and efforts of the forerunners of the group.

Therefore, the net payment per affected mortgage for members will be:

  • For existing members who have already instructed The Law Department £994 (assuming a refund of £150 per affected mortgage from The Law Department)
  • For new members the total cost per mortgage to be represented will be £1,500

We have created a simple set of instructions explaining how much you need to pay and who you need to pay it to here >>>

Remember, if/when we win you will get more than this amount back when you also factor in 100% of the extra 1.9% interest you have been paying which will also be refunded. The worst case scenario is that you will get none of this money back if we lose. If you can live with that you should proceed.

The reason we have chosen this strategy as opposed to buying ATE insurance is that it costs us much less if we win. We are in this to win this. The above strategy means that we all know what we stand to lose and can proceed with our eyes wide open, confident that our liabilities are limited.

If the balance of the BARCO account associated with this action is less than £250,000 by close of business on Friday 28th March 2014 the legal action case will be aborted, funds will be returned to members within 14 days and that will be the end of the line for this campaign for myself and Property118 – at least for 12 months or more anyway. If necessary we will then take another look at Plan B.

UPDATE – 31st March 2014

Since publishing this article our campaign has raised over £450,000 and legal action has now commenced. The official closing date for borrowers to be represented in this action was 28th March 2014. However, it may still be possible to be included in the representative action by paying additional fees to cover administration and Court fees to be added to the list of represented claimants. For further details please Contact Carla Morris-Papps at Cotswold Barristers – telephone 01242 639 454 or email

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Ian Burton

10:05 AM, 26th March 2014, About 9 years ago

Hi Mark

It does not however preclude us from donating some (or even all) of our winnings towards the BOI.

Just a thought for the altruists amongst us.

Richard Kent

10:14 AM, 26th March 2014, About 9 years ago

Reply to the comment left by "Mark Alexander" at "26/03/2014 - 10:00":

Thanks Mark,

I Know,
It was lighthearted comment hence the " 😉 " at the end.

I appreciate that some might have taken that seriously so you had to reply 🙂

Richard Kent

10:16 AM, 26th March 2014, About 9 years ago

Reply to the comment left by "Ian Burton" at "26/03/2014 - 10:05":

Now that is altruistic statement! 🙂

Can you imagine the reaction from the lenders if you pooled a percentage of the winnings to fight these hikes in future? 🙂

mark smith

10:23 AM, 26th March 2014, About 9 years ago

Reply to the comment left by "Richard Kent " at "26/03/2014 - 10:14":

Dear Richard and others,

Your comment was evidently light hearted, but in view of comments about Mark A elsewhere I reiterate that the WB case funds are tightly controlled, held in escrow under strict conditions, and can only be released once the conditions agreed to by the members are fulfilled.

(Again, I know you meant no harm)

Richard Adams

10:47 AM, 26th March 2014, About 9 years ago

Reply to the comment left by "Richard Kent " at "26/03/2014 - 08:04":

Sure thing Richard opine as you desire. That's what the forum is for. Whether our speculation about mindsets of people we don't know is a worthwhile exercise is another matter? Makes me feel better though.

Broadly we are not far apart. Borrowers with no internet access or little expertise are off the hook in my book and yours, as are folk who just don't know despite all the publicity about Property118. Equally I'll readily excuse those who either have, or have sought, legal expertise and have decided our case is unwinnable. Very few in this category I suspect. They are wrong but entitled to their opinion.

Armed with any expertise they would also know that the WB repossession threat is/was not to be feared so I don't buy that excuse. Any borrower could have checked this out..

Re mortgaging is a fair point. I looked at it but at my age nobody would look at me. While re mortgaging is often bandied about, just how easy and how cheap would it be if indeed even attainable? On a property where value has fallen, impossible I reckon.

Does this list cover all the non joiners to the action? I stick to my guns and say no and repeat there will be some who are just plain negative - don't want to get involved etc - which like i said before is a sign of our times. Just try recruiting folk to join any cause these days or come out of their houses and support an event in town etc etc. "We'll think about it". Then they draw the curtains and switch the TV on! Pathetic! Can't be bothered to vote in elections either but will whinge in conversation if you are unfortunate to meet them about the grass verges etc.

That we have achieved what we have in spite of all this is beyond the wildest dreams of me for starters and without Mark A it just would not have happened. No firm, inspiring and patient leadership would have led to us being dead in the water. That his magnanimity even now is encompassing arrangements, in discussions with Mark S, for making it possible for the fence sitters I abhor to jump on the bandwagon later on after the win demonstrates what a fine and considerate man he is.


11:47 AM, 26th March 2014, About 9 years ago

Reply to the comment left by "Richard Adams" at "26/03/2014 - 10:47":

I agree. I own properties with an old School friend and my wife.

There is no way either of these two would have done anything about this rise left to their own devises. I have clients who have West brom mortgages and despite talking to them the most they did was sign the petition I set up.

Too many people just sit back and accept it just to get on with an easy life.

That's how these type of organisations can get away with it and Id bet that's exactly what West brom thought would happen.

I thought we might be able to bring pressure on West brom or the regulatory bodies or the MPs to do something. I never thought we would have to take it this far. But they have all sat back, paid lip service to us but at the end of the day left us on our own.

I never thought we would have raised the funds we have , maybe £220K to £250K but never £400k+.

I am very very proud to be able to say a played a small part in this and win or lose I will bore people about what we actually achieved for years to come.

I had hoped that the funds we raised would push West Brom to come to an agreement with us before it went to Court.

I don't care what they do now. I fully believe we have raised more than enough to put together a very strong case and be able to fight an appeal should we win or put up an appeal should we lose.

But, rightly or wrongly I personally hope we as a group are the only ones to benefit as a result of the personal and financial investments we have all put into this . I know everyone will not agree with that and are entitled to their opinion , but I don't see why all those ,just like my friend and wife should benefit from our work and costs .

I do however hope , that should any other organisation try and renege on a contract they realise that there are some people who will stand up to them !

Mark Alexander - Founder of Property118

13:06 PM, 26th March 2014, About 9 years ago

Interesting discussions this morning.

My take on this is that when we win there will be a lot more interest in the case. We will have paid with our time but the financial cost will be negligible if anything at all.

Our win will inspire others to take action because their objections will all have been dealt with and they will probably be offered no-win-no-fee deals. However, there will not be a group to latch onto so when they do win they will pay to get their refunds and original terms restored at a price.

I will personally have no problem promoting that but I will not be doing it for nothing either. The cost will probably be equal to the value of their refunds, by then at least a years worth of over payments, and I will expect to take a fair share of that on top of whatever Cotswold Barristers charge. I think that's only fair, don't you?

By the way, when we do all get our refunds of overpayments and fees held in the BARCO account it will hopefully be the season of goodwill. Please remember us at that time and note that we run Property118 on refunds and sponsorships alone. We would love to be able to do a lot more but there's only so much we can do based upon limited funds 😉

The Man From Nowhere

14:32 PM, 26th March 2014, About 9 years ago

A Supreme Court win today for the "little guy" who has finally managed a hard fought victory against one of the big financial institutions, creating a precedent that will benefit all consumers. It just goes to show that even one man can make a difference if he has the courage to fight for what is just and right.

Today's judgment is a significant victory for consumers.

The judgment establishes that if you buy goods using a credit agreement, and then validly terminate the contract of sale by rejecting the goods, you can also validly end the credit agreement.

More significantly, it establishes that any lender who wants to blacklist a consumer's credit rating, when they are asserting that they've terminated the credit agreement, owes that consumer a duty of care to ensure that they are genuinely in default of the credit agreement.

Mr Durkin had told HFC bank that he'd ended the credit agreement.

The court found that, in the light of that, HFC were under a duty to make the appropriate enquiries to establish if he had. They did not do so.

Mr Durkin's legacy will be that banks and others extending credit to purchase goods under what are known as 'debtor, creditor, supplier' agreements will have to be exceptionally careful before informing credit agencies that the customer is in default.

If they get it wrong and are negligent, they can be sued by the customer.

The Seasoned Female Investor

14:34 PM, 26th March 2014, About 9 years ago

Have not posted for a while........just picking splinters out my ar******* before I commit today with two fees. I like to sit back and watch until the last moment, then play my hand......


May I add.....If, ...when we win the dispute with WB, I would like pledge one months increase on one of my mortgages ( that I won't be paying to WB..because we have won) to Property 118.

I like would motion that if every named person in the class action done the same,...donated one months increase on one mortgage..... 118 would receive a nice cash injection as just rewards.!!!!!

Ian Burton

14:38 PM, 26th March 2014, About 9 years ago

Reply to the comment left by "The Man From Nowhere" at "26/03/2014 - 14:32":

The man from Nowhere

It was a brilliant win and just goes to show that the principal matters. It took a lot of guts to risk giving up £135K Makes our risk look insignificant SO lets soldier on our money is peanuts compared to him

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