We have all experienced these fees and felt annoyed at having to wear such a large amount for what seems to be a minor default on a credit card or bank account. The customers in this case argued that the fees they paid were not a reasonable estimate of the actual costs to the bank of their default. They argued that the fees amounted to the imposition of a penalty by the bank and were unenforceable. The customers demanded the bank repay those amounts to them and others in the class of customers.
Experts were called by both sides as to what actual costs were caused to the bank by events that triggered the fees. The customers argued that only a narrow range of costs were incurred by the bank. The bank’s expert included a broader range of costs.
The customers succeeded initially, the Federal Court finding that the fees charged by the bank were a penalty. On appeal the Full Federal Court disagreed. The High Court then settled matters by finding that the fees were not penalties; the bank was entitled to be compensated for a broad range of costs caused by the triggering events.
At Everingham Solomons, we have the experience and expertise to assist you with legal advice on your relationship with your bank, one of your key business partners because Helping You is Our Business.
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