Property118 Members vs West Bromwich Mortgage Company

by Mark Alexander

10:25 AM, 3rd March 2014
About 6 years ago

Property118 Members vs West Bromwich Mortgage Company

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Property118 Members vs West Bromwich Mortgage Company

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


Mike L

21:03 PM, 3rd April 2014
About 6 years ago

Richard Kent

I think you missed my main point. I like being involved and doing something about the situation we find ourselves in. Why would I want to stop or cut down? I'm enjoying it.

Onslow Clough

23:52 PM, 3rd April 2014
About 6 years ago

Hi Mike, I'm with you, we didn't get to where we are now by sitting back and doing nothing. As a group we have been very proactive and must continue to be so, that is why we will succeed.

Richard has provided an in-depth breakdown of your post which i'm sure you found very helpful and not at all patronising, but personally I would suggest you don't rise to the bait.

Lets all carry the fight to WB. Lets put pressure on our MP's, write to national newspapers or even local papers, lets get our story heard. Let as many people as possible hear the David and Goliath story.

I know I will be doing all this and more and i would politely suggest no-one tries to explain to me in point by point detail why I am wasting my time.

Onslow Clough

1:34 AM, 4th April 2014
About 6 years ago

This is how I imagine our friend Lewis Ranieri would be in a pop group. Hope you're watching Lewis.


Onslow Clough

1:46 AM, 4th April 2014
About 6 years ago

hopefully this link will work.

Lewis,, Enjoy.

Mark Alexander

8:21 AM, 4th April 2014
About 6 years ago

From a marketeers perspective it has been intriguing to observe the various human behavioural patterns throughout this campaign to date.

We've seen the typical emotional rollercoaster of surprise panic blame. We've seen the RTMS team building model (Recruit, Train, Motivate, Sell). We've seen teamwork and now some of us have surplus anger, adrenaline and endorphins in our systems which some soldiers experience after returning home from battle.

We must all accept that we are all different, there is little point arguing about it.

We have achieved part one and two of our mission and as Richard Kent quite rightly points out the next important stage will be the first trial hearing. That's not to say that anybody is right or wrong if they choose to continue campaigning in the meantime though. Battling on these opinions is merely a sign of different emotions coming out between battles. The more they are debated the stronger those emotions become until they engrained into the psyche.

Most will now have gone back to their normal lives and will no longer be following this forum, I would say that represents around 90% of the signed up group. That's absolutely fine, I would rather they focus their efforts on reading other threads and new articles on Property118 anyway, assuming they have the time and inclination to do so. Please remember that "to facilitate the sharing of best practice in the PRS" is the goal of Property118, not just to fight mortgage lenders.

Rest assured, we now have a system to email all signed up members of the group whenever there is anything important to communicate. Therefore, following this forum thread is no longer important.

Our campaign has also come under attack on other forums by landlord bashers and conspiracy theorists and they may migrate here to attempt to cause disruption. One did so a few weeks ago and was banned from posting again. If fact, our security here is so strong it is not even possible for another member to post the name that person was using as a pseudonym without the comment being marked as spam. We also have other security built into our systems to detect location, IP address and more so we do have the ability to identify and block these trouble makers.

Nevertheless, the time has come to close down this thread and utilise only the secure forum to organise further campaigning for those who wish to be part of it.

All BankersAreBarstewards Smith

8:46 AM, 4th April 2014
About 6 years ago

Interesting and rational comments about a volatile few days on the web. Thanks Mark. With regards to your comment

"Nevertheless, the time may soon come to close down this thread and utilise only the secure forum to organise further campaigning."

Please don't forget those of us who are not "paid up members" but who have nevertheless contributed to the funds in order to support WB victims.... I think we would be delighted to be kept up to date with publishable information. I hope I speak for others in this position, when i say that of course we understand the strict security requirements of the secure forum, but, these Lender bullying issues are of national importance for a lot of people.

Mark Alexander

9:00 AM, 4th April 2014
About 6 years ago

Reply to the comment left by "All BankersAreBarstewards Smith" at "04/04/2014 - 08:46":

Point very well made and noted.

If there are any twists and turns which are appropriate for publication I will create new articles as necessary. We also have the ability to produce articles without a discussion forum below, i.e. information only news articles.

Neil Patterson

20:06 PM, 17th February 2016
About 4 years ago

Article from the FT adviser >>

"Time can be a great healer when it comes to obscuring memories of financial disasters.

So let us have a short history lesson and remember why such guarantees were put in place in the first place.

It followed a series of scandals, some of which saw pensioners being sold loans attached to investment products which were supposed to repay the interest.

The most infamous of these were the West Bromwich Building Society home income plans.

In 1998 West Bromwich lost a High Court battle brought by 190 customers and was ordered to pay compensation averaging £13,000 to £14,000 per client.

We can only imagine how many people might be caught in a similar scandal in today’s much larger market.

Equity release is a worthwhile product. But it is also very complex and being sold to, potentially, very vulnerable people."

Mark Alexander

6:57 AM, 8th April 2016
About 4 years ago

The appeal date is confirmed, please see the linked article below ...

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