The Court of Appeal has handed down its judgment in Breeze & Others v TSB Bank PLC [2026] EWCA Civ 32, upholding the decision of the High Court (Thompsell J) on two preliminary issues in significant group litigation claims brought by former Northern Rock mortgage customers against TSB.

The claims arise from TSB’s acquisition of a portfolio of former Northern Rock mortgages and loans, 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).

The appeal concerned two preliminary issues – a question of contractual construction and a matter of statutory interpretation. In summary:

  • Express Terms Issue: Whether, following transfer of the mortgages, TSB breached the express terms of the mortgage contracts by charging interest based on the ‘Whistletree’ SVR and not one of TSB’s pre-existing SVRs which it applies to its other mortgages.
  • Consumer Credit Act Issue: Whether section 140A(5) of the CCA 1974 precludes certain claims for relief in respect of regulated mortgage contracts where they are ‘related to’ a separate credit agreement.

Both Issues were determined in favour of TSB at first instance, but the Claimants obtained permission to appeal to the Court of Appeal.

The Court of Appeal (Newey, Baker, Arnold LJJ) dismissed the appeal on both Issues:

  • It held that, on their proper construction, the contractual terms did not require a transferee lender (here, TSB) to charge the borrowers interest by reference to one of its own pre-existing SVRs. The transferee was entitled to continue to charge the rate applied by the transferor lender (Northern Rock) and subsequently vary it in accordance with the terms of the contract. This outcome disposes of the primary claim brought by the Claimants.
  • The court cannot make an order, under s.140B of the unfair relationship provisions of the CCA 1974, for relief affecting a regulated mortgage contract, such as for repayment of sums paid under that contract or to vary the terms of that contract. Such an order is precluded because it would be “in connection with” the regulated mortgage contract. The Claimants’ case was found to be a transparent attempt to avoid the consequences of the statutory scheme by using their unsecured loans as a back door to obtain relief in respect of their regulated mortgage contracts which (as they accepted) they cannot obtain by the front door.

This judgment has significant implications for the ongoing litigation and other cases involving former Northern Rock mortgages, other transferred mortgage portfolios and linked credit agreements.

The judgment of the Court of Appeal can be found here.

James Duffy KC appeared for TSB, together with Sonia Tolaney KC and Tim Goldfarb, instructed by Hogan Lovells International LLP.