Actions over Mortgages must take account of EU rules.

4ensic15

blueythebear wrote: »

I'm not proposing amending the term. I'm agreeing that the variable interest rate term will have no effect if found to be unfair but there will invariably be other clauses in the loan documentation that will be present that will allow interest be applied.

For example, most facility letters will set out basic information like the amount of the loan, the term and importantly, the interest rate as it applies at the outset of the loan. The result will be that the Bank will be likely able to charge interest as per the rate at the beginning of the loan and not at the punitive rate that is set out in the particular unfair term/clause.

In a lot of loans the initial interest rate is high relative to current interest rates. The complaint is mainly that reductions in wholesale market rates are not being passed on. paying 6% when the bank was sourcing money at 5% might be reasonable but now people are bieng charged 4% when the bank is sourcing money at 1%.
Taking out the variation clause will do a fat lot of good in that common scenario.

ReddySteady

Blueythebear, if the specific variable interest rate clause that deals with variable interest rate payments during the term of the loan is found to be unfair, then as Forbearance has said, it must be removed, it cannot be amended. The bank cannot attempt to charge interest via the back door by trying to circumvent the directive, that in itself would be unconscionable and unfair and a breach of article 7 of 93/13/eec.

Forbearance

IMPORTANT UPDATE,

This morning High Court Justice Noonan addressed the court before the commencement of some possession cases and told the court that there were no Judges available to hear these cases. He informed the body of the court of the dictum "Justice delayed is justice denied". He said Ireland is now in breach of the European Charter of Human Rights, all matters were adjourned till late 2017. He informed those affected today, to take the matter up with the European Courts of Justice.

GM228

Forbearance wrote: »

IMPORTANT UPDATE,

This morning High Court Justice Noonan addressed the court before the commencement of some possession cases and told the court that there were no Judges available to hear these cases. He informed the body of the court of the dictum "Justice delayed is justice denied". He said Ireland is now in breach of the European Charter of Human Rights, all matters were adjourned till late 2017. He informed those affected today, to take the matter up with the European Courts of Justice.

Did all the cases all involve EU law - as in applying EU regulations or decisions or implementing EU directives?

I also assume you mean the EU Charter of Fundamental Rights.

Forbearance

GM228 wrote: »

Did all the cases all involve EU law - as in applying EU regulations or decisions or implementing EU directives?

I also assume you mean the EU Charter of Fundamental Rights.

How would I possibly know that ? However, what I do know is that every possession case before a court must be assessed by the court for its possible unfairness under European legislation, whether the defendant raises such an issue or not.

In relation to your assumption I meant the European Convention on Human Rights.

GM228

Forbearance wrote: »

How would I possibly know that ? However, what I do know is that every possession case before a court must be assessed by the court for its possible unfairness under European legislation, whether the defendant raises such an issue or not.

In relation to your assumption I meant the European Convention on Human Rights.

Odd that, the ECHR is an international treaty between the Council of Europe members and has absolutely nothing to do with the ECJ as it isn't national or EU law.

Even matters under the EU Charter of Fundamental Rights or other EU law can only be referred to the ECJ in relation to the non implementation of EU law - in applying EU regulations, decisions or implementing EU directives as per Articles 263 and 265 of the TFEU. You can't simply refer any matter to the ECJ, it's not possible under EU law.

Forbearance

GM228 wrote: »

Odd that, the ECHR is an international treaty between the Council of Europe members and has absolutely nothing to do with the ECJ as it isn't national or EU law.

Even matters under the EU Charter of Fundamental Rights or other EU law can only be referred to the ECJ in relation to the non implementation of EU law - in applying EU regulations, decisions or implementing EU directives as per Articles 263 and 265 of the TFEU. You can't simply refer any matter to the ECJ, it's not possible under EU law.

Maybe Justice Noonan, like a plethora of other Irish Judges, need to read up on the operations and functions of the institutions of Europe and the application of European law.

blueythebear

4ensic15 wrote: »

In a lot of loans the initial interest rate is high relative to current interest rates. The complaint is mainly that reductions in wholesale market rates are not being passed on. paying 6% when the bank was sourcing money at 5% might be reasonable but now people are bieng charged 4% when the bank is sourcing money at 1%.
Taking out the variation clause will do a fat lot of good in that common scenario.

That's spot on in that scenario...if variation of interest clauses are deemed unfair it is arguable that the loan reverts to the original interest rate which will often be higher than the present low rates! So in trying to defend themselves, a borrower may actually increase his or her liability...

blueythebear

ReddySteady wrote: »

Blueythebear, if the specific variable interest rate clause that deals with variable interest rate payments during the term of the loan is found to be unfair, then as Forbearance has said, it must be removed, it cannot be amended. The bank cannot attempt to charge interest via the back door by trying to circumvent the directive, that in itself would be unconscionable and unfair and a breach of article 7 of 93/13/eec.

Not sure why you're including your first sentence as I acknowledged that.

Bank is not slipping anything in by the back door. Almost all loan documentation will state the interest rate at the outset of the loan. It's part of the contract and if a clause allowing arbitrary interest rate changes is unfair....then then other clauses will dictate the interest rate applicable

4ensic15

Forbearance wrote: »

Maybe Justice Noonan, like a plethora of other Irish Judges, need to read up on the operations and functions of the institutions of Europe and the application of European law.

His comment was about delay in having cases heard, and was not specifically about mortgage cases. Excessive delay in having a case heard is a breach of the ECHR. Nothing to do with unfair contract terms.

blueythebear

Forbearance wrote: »

Maybe Justice Noonan, like a plethora of other Irish Judges, need to read up on the operations and functions of the institutions of Europe and the application of European law.

I'd hazard a wild guess that the average high court judge has a vast knowledge of such matters...what with being a lawyer for many years and all

Forbearance

blueythebear wrote: »

I'd hazard a wild guess that the average high court judge has a vast knowledge of such matters...what with being a lawyer for many years and all

Then why praytell is there no Irish case precedent in relation to unfair terms in consumer contracts, when every other Member State in Europe has a volume of such precedent, perhaps the average high court judge is not as knowledgeable as you give them credit for being. It took newly appointed High Court Judge Max Barrett ( ex head of enforcement at Danske Bank ) to raise this spectre.

ohnonotgmail

Forbearance wrote: »

Then why praytell is there no case precedent in relation to unfair terms in consumer contracts, when every other Member State in Europe has a volume of such precedent, perhaps the average high court judge is not as knowledgeable as you give them credit for being. It took newly appointed High Court Judge Max Barrett ( ex head of enforcement at Danske Bank ) to raise this spectre.

How many cases have been brought before the high court on unfair terms in consumer contracts?

Forbearance

You tell me ?

ohnonotgmail

Forbearance wrote: »

You tell me ?

you seem very interested in the subject so i assumed you had put some effort into it.

Forbearance

Assume nothing, it makes an ass out of u and me, all I can say is that there is no case precedent in Irish Law that hinged on the application or non application of the EU Unfair Terms in Consumer Contract directive.

blueythebear

Forbearance wrote: »

Assume nothing, it makes an ass out of u and me, all I can say is that there is no case precedent in Irish Law that hinged on the application or non application of the EU Unfair Terms in Consumer Contract directive.

There is case law in relation to the Unfair Terms Directive, just not raised as a defence to lenders seeking repossession orders related to Irish residential mortgages. To my recollection, they were focussed on the definition of consumer and whether a particular borrowing formed part of a consumer contract or not.

However, a judge can only rule on what's put in front of him/her. There is no caselaw on the Unfair Terms Directive as a defence to repossession proceedings because no defendant has raised it until now.

Forbearance

blueythebear wrote: »

There is case law in relation to the Unfair Terms Directive, just not raised as a defence to lenders seeking repossession orders related to Irish residential mortgages. To my recollection, they were focussed on the definition of consumer and whether a particular borrowing formed part of a consumer contract or not.

However, a judge can only rule on what's put in front of him/her. There is no caselaw on the Unfair Terms Directive as a defence to repossession proceedings because no defendant has raised it until now.

Blueythebear, it is for the court of each Member State to consider, in it's own motion, whether any consumer contract put before it for adjudication falls foul of the unfair term directive. I repeat again, it is a requirement of the directive that such Member State court so assesses, whether the defendant has raised the unfair terms directive as a defence or not ( see ECJ Pannon determination.) This is the crux of my argument.

ReddySteady

Forbearance wrote: »

Blueythebear, it is for the court of each Member State to consider, in it's own motion, whether any consumer contract put before it for adjudication falls foul of the unfair term directive. I repeat again, it is a requirement of the directive that such Member State court so assesses, whether the defendant has raised the unfair terms directive as a defence or not ( see ECJ Pannon determination.) This is the crux of my argument.

I get it.

blueythebear

Forbearance wrote: »

Blueythebear, it is for the court of each Member State to consider, in it's own motion, whether any consumer contract put before it for adjudication falls foul of the unfair term directive. I repeat again, it is a requirement of the directive that such Member State court so assesses, whether the defendant has raised the unfair terms directive as a defence or not ( see ECJ Pannon determination.) This is the crux of my argument.

But that doesn't answer the question why there is little or no caselaw on the application of the Unfair Terms in Consumer Contracts Directive... in my own view, in order to get a precedent on the subject, it must be raised as a defence for the court to specifically address it as part of a judgment.

I completely understand that the Court must of its' own motion examine the contract in question under the Unfair Terms Directive but no Judge has expressly done so thus far. It could be because no analysis of the fairness of the contract terms is carried out or it could be because the analysis was carried out and no terms were deemed to be unfair. I imagine that the answer lies in the middle somewhere, in that the relevant terms being relied on in the application for possession have been deemed as fair in the process of the court coming to its' decision.

GM228

4ensic15 wrote: »

His comment was about delay in having cases heard, and was not specifically about mortgage cases. Excessive delay in having a case heard is a breach of the ECHR. Nothing to do with unfair contract terms.

A breach of Article 6 of the ECHR would be a matter for the European Court of Human Rights (which I might add could not make a binding ruling on Ireland), not the ECJ. The ECHR has not acceded to the EU as yet and as such is beyond the competence of the EU to decide upon.

Are we sure this isn't getting mixed up with a breach of Article 47 of the EU Charter of Fundamental Rights which is something you can refer to the ECJ.

GM228

Forbearance wrote: »

Blueythebear, it is for the court of each Member State to consider, in it's own motion, whether any consumer contract put before it for adjudication falls foul of the unfair term directive. I repeat again, it is a requirement of the directive that such Member State court so assesses, whether the defendant has raised the unfair terms directive as a defence or not ( see ECJ Pannon determination.) This is the crux of my argument.

The Pannon case is interesting in that it isn't technically automatically applied to Irish courts per se.

As it is a preliminary ruling in relation to the interpretation of a Directive under the provisions of Article 234 of the TFEU the ruling simply provided an interpretation, or more accurately it clarified a requirement of Directive 93/13/EEC.

As we are dealing with the requirements of a Directive, that clarified requirement does not technically have the rule of law until that requirement is specifically transposed in Irish law. As such Irish law would require those specific requirements of the directive to be transposed into Irish legislation including possibly the Rules of Court. As such until that actually happens I would think that a plaintiff still has to raise the defence of the Pannon judgement under the concept of Vertical Direct Effect.

Also worth noting that Mr. Justice Barret didn't state that "The EU rule imposes an obligation on courts in such cases, regardless of whether they are asked to do so or not, to examine the mortgage contract and decide if any of its terms are unfair" as per the Irish Times article in your OP. He stated in dictum that the ECJs observations appear to contemplate a court, even in an adversarial system of justice, to act in a inquisitorial manner. That to me isn't conclusive. He also raised concerns on how the task identified by the ECJ falls to be discharged in a common law system grounded upon, inter alia, the rules of precedent.

Forbearance

GM228 wrote: »

The Pannon case is interesting in that it isn't technically automatically applied to Irish courts per se.

As it is a preliminary ruling in relation to the interpretation of a Directive under the provisions of Article 234 of the TFEU the ruling simply provided an interpretation, or more accurately it clarified a requirement of Directive 93/13/EEC.

As we are dealing with the requirements of a Directive, that clarified requirement does not technically have the rule of law until that requirement is specifically transposed in Irish law. As such Irish law would require those specific requirements of the directive to be transposed into Irish legislation including possibly the Rules of Court. As such until that actually happens I would think that a plaintiff still has to raise the defence of the Pannon judgement under the concept of Vertical Direct Effect.

Also worth noting that Mr. Justice Barret didn't state that "The EU rule imposes an obligation on courts in such cases, regardless of whether they are asked to do so or not, to examine the mortgage contract and decide if any of its terms are unfair" as per the Irish Times article in your OP. He stated in dictum that the ECJs observations appear to contemplate a court, even in an adversarial system of justice, to act in a inquisitorial manner. That to me isn't conclusive. He also raised concerns on how the task identified by the ECJ falls to be discharged in a common law system grounded upon, inter alia, the rules of precedent.

GM228, do you think the Irish Judiciary have complied with si 27/1995 as amended in terms of their assessment, on their own motion, of any probably unfairness within terms in mortgage contracts that come before the courts for adjudication ?

Forbearance

GM228 wrote: »

The Pannon case is interesting in that it isn't technically automatically applied to Irish courts per se.

As it is a preliminary ruling in relation to the interpretation of a Directive under the provisions of Article 234 of the TFEU the ruling simply provided an interpretation, or more accurately it clarified a requirement of Directive 93/13/EEC.

As we are dealing with the requirements of a Directive, that clarified requirement does not technically have the rule of law until that requirement is specifically transposed in Irish law. As such Irish law would require those specific requirements of the directive to be transposed into Irish legislation including possibly the Rules of Court. As such until that actually happens I would think that a plaintiff still has to raise the defence of the Pannon judgement under the concept of Vertical Direct Effect.


Also worth noting that Mr. Justice Barret didn't state that "The EU rule imposes an obligation on courts in such cases, regardless of whether they are asked to do so or not, to examine the mortgage contract and decide if any of its terms are unfair" as per the Irish Times article in your OP. He stated in dictum that the ECJs observations appear to contemplate a court, even in an adversarial system of justice, to act in a inquisitorial manner. That to me isn't conclusive. He
also raised concerns on how the task identified by the ECJ falls to be discharged in a common law system grounded upon, inter alia, the rules of precedent.

GM228, own motion assessment in relation to the unfair terms directive became obligatory after the Aziz case going forward, as alluded to by Justice Barrett in AIB v Counihan. There is a good article in the April 2017 Irish Law Gazette relating to Unfair Terms that may clarify matters for you in this regard.

ReddySteady

ReddySteady wrote: »

Chops018, here is the standard variable interest rate mortgage term in a BOI mortgage.

3.4 The Bank may vary the interest rate on the Loan up or down at
any time or times during the period of the Loan at its discretion.

Now, lets apply the Matei determination to this clause, in para 76 it states

"As regards the contractual terms at issue in the main proceedings and, first, those allowing the lender unilaterally to alter the interest rate, the question arises as to the foreseeability for the consumer of increases in that rate which may be made by the lender according to the criterion, which is prima facie not transparent, relating to "significant changes in the money market", even if that formulation is in itself grammatically plain and intelligible."


So in the Matei determination it states that the parameter of "signifigant changes in the money market is not tranparent" and therefore can be assessed as been unfair by a national court, then pray tell, how has BOI gotten away with their variable rate term not so assessed ? The answer is that the Court must assess possible unfair clauses of it's own motion whether a defendant has brought it to the courts attention or not, this has not happened. Think of all the repossession cases that BOI and the other Irish Banks have got away with because the Irish Judiciary have not complied with their obligations under the Treaty of Rome. Wow, need to get in touch with Gary Fitzgerald BL urgently and get this show on the road.

That the same guy who wrote that article in the April 2017 edition of The Irish Law Gazette on Unfair Terms, Forbearance are you Gary Fitzgerald or do you know him ?

ReddySteady

I see all the Pharacies and Sagucies legal types have gone quiet on this thread! anyone out there.