Providing a win for ANZ Bank in a $50 million class action brought against it by IMF, the Federal Court ruled today (5 December) that the bank's honour fees, dishonour fees, over-limit fees and non-payment fees were not capable of being characterised as penalties.
Maurice Blackburn filed the class action against ANZ on 22 September for unlawful penalty fees - the first of 12 major banks to face mass legal action - arguing that the exception fees charged by ANZ are illegal and that banks should only charge customers for their reasonable costs incurred, which may be as little as $1, rather than the $20 currently charged by ANZ for late credit card payments.
"We identified 17 different fees and charges applied by ANZ to its customers, which we believe are an unfair and excessive imposition on the more than 34,000 people who are part of the class action," said Maurice Blackburn principal Andrew Watson.
Following a two and a half day hearing in October, Justice Gordon held today that one of ANZ's bank fees - the late payment fee - was capable of being characterised as a penalty. Whether it is in fact a penalty will be examined in the action's main trial in 2012.
"Today's Federal Court judgment found that most of the fees being looked at by the court were not a penalty," said ANZ chief executive officer Australia Philip Chronican.
"Our consistent position has been that while some of these fees may have been unpopular, we believe they were lawful and we're pleased this has been largely vindicated in today's ruling.
"The one finding in IMF's favour does not provide a resolution for class action participants. It's a complex case still in the preliminary stages and we will continue to vigorously defend the IMF action next year," he said.
The legal action is being funded on a 'no win, no fee' basis by litigation funder IMF Australia and managed by its subsidiary, Financial Redress.