2.1David versus Goliath

How often have you heard the aloof retort, when some Senior Management Representative of a Financial Institution is confronted with the unfairness of their treatment of the consumer:

“ We have not broken any Law. ”

What the representative means, though the distinction is never made, is that the Financial Institution has not broken any Statute Law; but they may well be flouting the Common Law with absolute abandon. They may also in fact be breaking some Statute Law, but the person confronting them may be unaware of the existence of such a law and, even if he is aware of it, his fear that a libel action by the Financial Institution could ensue prevents him from specifically confronting them on the matter.

Note!  Common Law is the body of Law that has evolved over the centuries and is derived from custom and judicial precedent, rather than statutes. It is the law as stated and decided by the judiciary, and that has become accepted over time to be just and fair.

Note!  Statute Law is the body of written Laws that have been enacted by the legislature (i.e. the various Acts and Statutes of the Government / Parliament).

Generally speaking, the consumer is very slow to engage in litigation; this is particularly the case when the consumer must stand alone against some mighty Financial Institution. The aggrieved consumer’s resolve is gradually worn down by the Financial Institution, by their repeated denials and continual distortion of the substance of his grievance.

When the consumer goes to his Solicitor
, he is firstly confronted with the major obstacle of having to formulate a financially complicated grievance in a manner that will make the basis of a legal case apparent to his Solicitor. The Solicitor will therefore, justifiably, highlight the risk associated with the uncertainty of the outcome of such a complicated case.

Secondly, the Solicitor will point out the ‘David versus Goliath’ nature of the case and the considerable stress associated with taking a Legal Action against such a formidable adversary. As a matter of prudence, he will give express opinion that the consumer will need an ‘expert witness’, expert in financial matters, to support the basis of his case, and that this ‘expert witness’ will have to be of sufficient credibility to be pitted against the formidable ‘expert witnesses’ of the Financial Institution.

Thirdly, the Solicitor will outline the likely heavy cost/stress associated with such an Action. (My own Solicitor said to me: “I hope you have plenty of money. ––– Have you just won the lottery or something?”) He will particularly highlight the cost/stress involved relative to the uncertainty of a successful outcome to the Action.

He will then pose the question: ‘Do you really want to go through with this case?’


The application of the law is generally such that the exercising of his legal rights, both at Common Law and Statute Law, must be done by the individual consumer, each for himself. It is therefore understandable why only the unrelenting among consumers take on the Financial Institutions; and, even with these very few cases, the issue is invariably settled out of Court by the Financial Institutions, thereby ensuring silence and perpetuating the state of ignorance of the Law on such matters among consumers generally.

In this environment, those among the Financial Institutions, who choose to either abstain from enquiry as to the legal duties incumbent upon them at Common Law and Statute Law, or to ignore such duties, have a free hand to take advantage of the consumer at will. The minor financial penalty, if any, accruing from an Action taken by the isolated individual consumer who stubbornly persists in pursuing his grievance, is far outweighed by the rich rewards to be gained by pursuing a policy of abusing the rights of consumers generally.

It is for such reasons that consumer associations continually agitate for mandatory regulations to protect the consumer and impart some semblance of ‘fair play’. The State, eventually, intervenes and enacts Statute Laws dealing with such consumer contracts; but consumer associations then find that they must agitate again to have these Statute Laws enforced.

In recent years much legislation has been introduced in an effort to specifically redress some of the imbalances that existed in contracts between consumers and Financial Institutions.

These Statute Laws are generally just specific, though very well focused, manifestations of Common Law. Their general purpose, by virtue of their mandatory nature, is to clearly define the practices that give rise to an offence or to a contravention of their provisions, and thereby induce the Financial Institutions to refrain from such practices, thus protecting the consumer.

One of the paradoxical effects of such newly enacted Statutory Legislation is that the illusion is created in the mind of the consumer that the necessity of introducing such legislation infers that a legal void existed prior to its introduction.

Nowhere is this paradoxical effect more manifestly exploited than in the field of Consumer Credit and Investment Transactions.

When newly enacted Statutory Legislation is introduced, the Financial Institutions prominently extol their compliance with the specified requirements of such legislation and the delusion is imparted to the consumer that, because no such statute-specified requirements existed prior to the enactment of the legislation, he had no right to redress prior to its enactment.

Add to this then, the further delusion imparted by the orchestrated gravitas with which the Financial Services Regulatory Bodies have for years feigned an able pursuit of their regulatory functions (excepting, it must definitely be acknowledged, some of the eventual efforts by the U.K. Financial Services Authority) and, effectively, etherised the legal profession, thus preventing a proper legal confrontation of the actions of the Financial Institutions on the basis of both Common Law and Statute Law.

One could get the distinct impression that, in the matter of the rights of the consumer to seek redress against Financial Institutions, ‘the Law is an Ass’.

But, it will become clear from the contents of this Chapter that:

–––––– Nothing could be further from the Truth.

When a consumer’s rights are abused, notwithstanding the fact that a crime may have been committed, the consumer is generally left to fight his own corner by taking a Civil Action. It is, therefore, vitally important that you, the consumer, become aware of your considerable powers both under Common Law and under Statute Law.

The Chapters that follow will decode and analyse the advice, representations, quotations, terms and conditions, pertaining to an Endowment Mortgage Contract and a Repayment Mortgage Contract. These analyses are presented as clearly as possible on a first principles basis. The subject matter, however, is such that your continued interest will best be ensured if I first generate in you a belief that, by going to battle, justice can actually be achieved.

This Chapter is therefore intended to give you a battle – confident familiarity in the usage of the most powerful legal weaponry from the Arsenal at your disposal through Common Law and Statute Law.


While interpretation of Law is a matter for those qualified to do so, this in no way takes from the fact that the Law itself is, thankfully, written in English. As I have no legal qualifications, my inexpert selective survey of the Law, as presented in this Chapter, is one where the various elements of Law have been primarily chosen from four formidable books on the subject of Contract Law.

These four books are:

(1) ANSON’S Law of Contract —— 29th Edition (2010)

— edited by J. Beatson, A. Burrows and J.Cartwright.

— published by Oxford University Press.

Sir Jack Beatson DCL, LLD, FBA is a Justice of the High Court, Queen's Bench Division, and sometime Rouse Ball Professor of English Law, University of Cambridge.

Andrew Burrows BCL, MA, LLM (Harvard), FBA, QC (HON) is Norton Rose Professor of Commercial Law, University College Oxford.

John Cartwright BCL, MA is Professor of the Law of Contract, University of Oxford, and Professor of Anglo-American Private Law, University of Leiden.

(2) Contract Law in Ireland —— 6th Edition (2008)

— by Robert Clark.

— published by Thompson Round Hall.

Robert Clark, B.A., L.L.M., Ph.D, Barrister-at-Law (King’s Inns) is Associate Professor in the  School of Law, University College Dublin, and a consultant to Arthur Cox, Dublin and London. 

(3) Contract Law

Cases, Materials and Commentary —— (1994)

— by S. Wheeler and J. Shaw.

— published by Oxford University Press.

Sally Wheeler, Lecturer in Law at the University of Nottingham. (1994)

Josephine Shaw, Senior Lecturer in the Department of Law at the University of Keele. (1994)

(4) Cheshire, Fifoot and Furmston’s Law of Contract —— 15th Edition (2007)

— edited by M.P. Furmston.

— published by Buttersworths (Lexis Nexis). (This Title is now owned by Oxford University Press.)

M.P. Furmston TD, MA, BCL, LLM, Emeritus Professor of Law and Senior Research Fellow at the University of Bristol, is also a Bencher at Gray's Inn, and was previously a Fellow of Lincoln College at the University of Oxford. 

On the matter of Cases and Materials, particular elements from U.K. and Irish Case Law have also been extracted from:

Contract Cases and Materials —— 4th Edition (2008)

— by Robert Clark and Blanaid Clarke.

— published by Gill and Macmillan.

Robert Clark, B.A., L.L.M., Ph.D, B.L. is Associate Professor in the Law School, University College Dublin, and a consultant to Arthur Cox & Company. 

Blanaid Clarke, B.C.L., M.B.S., B.L. is Associate Professor in the Law School, University College Dublin.

On specifics of the Law relating to the correlation of Duty to Non-Disclosure, I have referenced extracts from the superlative:

The Law Relating to Actionable Non-Disclosure and Other  Breaches of Duty in relations of Confidence, Influence and Advantage
—— 2nd Edition (1990)

— by A.K. Turner and R.J. Sutton

(updated and much expanded — from the Original [1915 edition] Text by George Spencer Bower).

— published by Butterworths.

George Spencer Bower, Sometime one of His Majesty's Counsel and a Master of the Bench of the Inner Temple.

Sir Alexander Kingcome Turner, K.B.E., M.A., LL.B. (N.Z.), (Hon.) LL.D. (Aukland), formerly President of the Court of Appeal of New Zealand.

Richard John Sutton, B.A., LL.M. (Aukland), LL.M. (Harvard), Professor of Law in the University of Otago.

I have also referenced some compelling statements on the matters of Fraud and Negligence from:

Salmond and Heuston on the Law of Torts —— 21st Edition (1996)

— by the Late R.F.V. Heuston and R.A. Buckley.

— published by Sweet & Maxwell.

R.F.V. Heuston, D.C.L. (Oxon.), F.B.A., Honorary Fellow of Pembroke College, Oxford, Honorary Bencher of Gray’s Inn and King’s Inns, Dublin, was Regius Professor of Laws at Trinity College, Dublin.

R.A. Buckley, M.A., D.Phil, of Lincoln’s Inn, Barrister, Professor of Law at the University of Reading. (1996)


Note! Within this Chapter on 'The Weapons of Law', I have only used the selective elements of the Law that I consider to be the most pertinent to the subject matter of this Book.


The use of the various extracts cited from the referenced Law Books should not be construed to in any way infer that the conclusions I have drawn are somehow condoned or supported by the authors, editors or publishers of these books.


Copyright © 2013, 2014 John O'Meara. All Rights Reserved.