The OFT are now analysing the implications of this judgement for their overall investigation into the fairness of the terms and conditions of the banks. Not all good for the OFT though, they lost on two of the three issues. The court rejected the OFT's case that charges are penalties and they are drafted in unintelligible, misleading language.

A verdict that the fees were also not subject to regulations governing unfair consumer contracts would have blocked tens of thousands of customers from claiming refunds, triggering widespread criticism of the OFT's intervention. Claims against the banks for the return of charges were placed on hold by the FSA in July 2007.

The OFT said it is still not expecting to conclude its own investigation into the fairness of overdraft fees, which it has been pursuing since last April, for several months.

All businesses have a duty to ensure that they are complying with the law. Current account providers will need to consider whether there are any implications from this judgement for their current terms and conditions.

Both the OFT and the banks have welcomed the judgement. The test case process was initiated by both parties to bring clarity to an issue which is of concern to a large number of bank customers.

The court concluded that a further hearing or hearings will now be required in order for the court to determine the issue of fairness (and any outstanding issues relating to the application of the principles in the judgement to the banks' historic terms).

This, in reality, means that the banks will not be paying out anytime soon. There may need to be further court hearings to determine any outstanding issues from the judgement. The exact timetable for the next steps will be decided by the court at a hearing on 22 May.

Whilst this news is encouraging for personal account holders, the good news for businesses is that business accounts are not affected by either the waiver or the test case. We would encourage businesses to submit a claim against their bank sooner rather than later as a victory for the banks with regards to personal accounts is sure to have knock-on effects for business account holders.