Sonia Tolaney KC and Tim Goldfarb acted for TSB in successfully resisting an appeal by the Claimants on two preliminary issues in proceedings brought by former Northern Rock mortgage customers against TSB: Breeze & Others v TSB Bank PLC [2026] EWCA Civ 32
The claims arise from TSB’s acquisition of thousands of former Northern Rock mortgages, which it administers under its ‘Whistletree’ brand. The claimants allege that TSB applied an excessively high standard variable rate (SVR) to these mortgages, in breach of contract and statutory duty. They also seek relief under the Unfair Terms in Consumer Contract Regulations and sections 140A and 140B of the Consumer Credit Act 1974 (CCA 1974).
TSB succeeded in a trial of preliminary issues (Breeze & Others v TSB Bank PLC [2024] EWHC 2427 (Ch)). The Claimants obtained permission to appeal on two of those issues, namely:
- The Express Terms Issue: Whether TSB breached the express terms of the mortgage contracts by applying a different SVR to its Whistletree mortgages compared to other TSB mortgages.
- The Consumer Credit Act Issue: Whether section 140A(5) of the CCA 1974 precludes certain claims for relief in respect of regulated mortgage contracts.
The Court of Appeal (Newey, Baker, Arnold LJJ) unanimously dismissed the appeal. Arnold LJ gave the leading judgment.
On the Express Terms Issue, Arnold LJ agreed with the Judge at first instance that TSB’s interpretation of the mortgage contracts is the correct one ([34]), which did not require TSB to align the SVR applied to former Northern Rock mortgages with the SVR applied to TSB’s other mortgage products.
The Consumer Credit Act Issue raised a novel point of statutory interpretation. Arnold LJ held that TSB’s interpretation of s. 140A of the CCA 1974 is correct with the effect that the court cannot make an order for relief under s. 140B of the CCA 1974 affecting a regulated mortgage contract, such as for repayment of sums paid under that contract or to vary the terms of that contract. This ruling clarifies how mortgages will be regulated where they are entered into as linked transactions to other consumer credit agreements.
Sonia Tolaney KC and Tim Goldfarb appeared for TSB, instructed by Hogan Lovells International LLP.
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