If you always wondered how your bank calculated their charges of £30 for sending you a letter, you are not alone. The UK Banks have refused to explain even to a House of Commons select comittee how they calculate their figures.
In English law, penalties for breach of contract are not enforceable because the amount that can legally be charged must reflect the actual losses incurred as a result of the breach of contract.
The Office of Fair Trading (OFT) in the UK has determined that anything over £12 is automaticaly deemed unfair (this does not mean anything below £12 is fair), meaning, you are now able to claim back those unfair penalties from your bank.