- ANZ credit card fee battle reaches High Court of Australia
- Elizabeth Byrne
- 07/02/2016 Make a Comment
- Contributed by: Bazza ( 1 article in 2016 )
Bank customers could be eligible to be reimbursed hundreds of millions of dollars in credit card late payment fees if a challenge beginning in the High Court in Canberra today [4/2/16] succeeds.
Key points:
Thousands of ANZ customers are part of a class action hoping to convince the court the fees are not legal.
It is one of several class actions against the big banks, with the other cases waiting on the outcome of the High Court appeal.
The cases include the Commonwealth Bank, Westpac, National Australia Bank, Citibank, St George, BankSA, and BankWest.
Initially the Federal Court ruled in favour of the customers finding the late payment fees were extravagant, exorbitant and unconscionable, and therefore not lawful.
Then Federal Court Justice Michelle Gordon found the late payment credit card fees of up to $35 bore no relationship to the cost to the bank, which was about 50 cents.
Justice Gordon now sits in the High Court and will not be able to take part in the hearing.
Her original judgment was later overturned by a full bench of the Federal Court, prompting the High Court action.
The case has narrowed since it began after both Justice Gordon and the full bench found other bank charges, including over-limit credit card fees, were fair.
One of the lawyers representing the customers, Andrew Watson, said if they won the case it would have ramifications across the banking sector.
"The case will determine principles which affect not just the customers of ANZ but every banking customer in Australia who's ever paid a late payment fee on a credit card," he said outside the High Court.
"They (ANZ) could have, if they wanted, charged late payment fees of up to $7,000 per transaction because that was the maximum conceivable cost that could have occurred if someone was one day late paying their credit card transaction.
"We think that's an absurdity, we're going to say that to the High Court. We hope we succeed."
Key points:
- Thousands of ANZ customers joined a class action to have late fees ruled an unenforceable penalty
- The Federal Court initially ruled the fees of up to $35 bore no relationship to the actual cost of 50 cents
- ANZ won an appeal to the full bench, prompting today's High Court challenge
Thousands of ANZ customers are part of a class action hoping to convince the court the fees are not legal.
It is one of several class actions against the big banks, with the other cases waiting on the outcome of the High Court appeal.
The cases include the Commonwealth Bank, Westpac, National Australia Bank, Citibank, St George, BankSA, and BankWest.
Initially the Federal Court ruled in favour of the customers finding the late payment fees were extravagant, exorbitant and unconscionable, and therefore not lawful.
Then Federal Court Justice Michelle Gordon found the late payment credit card fees of up to $35 bore no relationship to the cost to the bank, which was about 50 cents.
Justice Gordon now sits in the High Court and will not be able to take part in the hearing.
Her original judgment was later overturned by a full bench of the Federal Court, prompting the High Court action.
The case has narrowed since it began after both Justice Gordon and the full bench found other bank charges, including over-limit credit card fees, were fair.
One of the lawyers representing the customers, Andrew Watson, said if they won the case it would have ramifications across the banking sector.
"The case will determine principles which affect not just the customers of ANZ but every banking customer in Australia who's ever paid a late payment fee on a credit card," he said outside the High Court.
"They (ANZ) could have, if they wanted, charged late payment fees of up to $7,000 per transaction because that was the maximum conceivable cost that could have occurred if someone was one day late paying their credit card transaction.
"We think that's an absurdity, we're going to say that to the High Court. We hope we succeed."
Source: https://www.abc.net.au/news/2016-02-04/anz-credit-card-fee-battle-reaches-high-court-of-australia/7138414
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