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Landlords set to start legal action against Bank of Ireland

It is now been three years since Property 118 questioned West Brom’s – the now obsolete specialist lending arm - decision in September 2013 to raise its tracker rate for around 6,700 landlords without a base rate rise from 1.49% to 3.49%.

Despite legal action launched by Property 118, a court sided with West Brom in January 2015, saying the lender was allowed to increase its rates to handle changing market conditions. But that decision was overturned by the Appeal Court in June 2016 after it found that West Brom had been wrong to raise rates in the way it had.

West Brom eventually repaid £27.5m of overpaid interest to its customers and this led Property 118 to question the way other lenders were treating tracker rates, identifying Skipton, Manchester Building Society, and the Bank of Ireland as dealing with their customers in a similarly unfair way.


The Property 118 Action Group has been using a crowdfunder website to build up funds to sue lenders that acted in a similar way to West Brom.

But while Property 118 has suspended its plans to pursue Manchester BS due to insufficient data and complaints, the group’s founder, Mark Alexander, has confirmed plans to legal proceedings against the Bank of Ireland, although its initial action will not be against the Bank of Ireland, but the law firms involved in advising upon and completing the mortgages.

Alexander said: “The legal battle against The West Brom lasted nearly three years before Property118 Action Group were triumphant – the Court of Appeal eventually overruled the Financial Ombudsman Service and found against The West Brom, who were then compelled to refund a reported £27,500,000. We believe compensation claims relating to the Bank of Ireland tracker rate differential increase could more than double this figure.”

However, the case against the Bank of Ireland will not be an easy one to win as it rejects the claim that the outcome of the West Brom case is applicable to them.

A Bank of Ireland spokesperson recently said: “The West Bromwich case is not com­parable to Bank of Ireland UK.

“Bank of Ireland’s offer document and mortgage terms and conditions expressly stipulated that the tracking margin or differential could be varied, and the offer and mortgage conditions documents are consistent, allowing for the differential to be lawfully changed.”

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