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Australian law firm Slater and Gordon today announced plans for a class action on behalf of bank customers in New Zealand who have been overcharged up to $1 billion (NZD) in bank fees.
Slater and Gordon class action lawyer Ben Hardwick said more than a million New Zealanders were eligible to join the action which will be the largest in New Zealand history.
“Litigation of this scale is something that is new to New Zealand. Slater and Gordon is bringing to the table decades of experience in this area, as the firm that has pioneered class actions in Australia over the past 25 years,” Mr Hardwick said.
The firm is working with Auckland lawyer Andrew Hooker, who will lead the action, and litigation funder Litigation Lending Services (NZ) in a case that follows similar actions commenced in Australia in recent years.
“Since the 1980s, class actions have given better access to justice to thousands of Australians and we are pleased to be able to share some of our experience with our neighbours across the Tasman,” Mr Hardwick said.
Mr Hardwick said Kiwi banks had been overcharging customers on default fees for years, charging them an average of $15 every time they overdraw their accounts, pay their credit card late or bounce a cheque, when the actual cost to the bank is only a few cents.
“These fees are clearly excessive and we estimate charges totalling up to $1 billion over the past six years. This case is about giving New Zealanders an opportunity to take a stand,” he said.
The case will be based on the doctrine of penalties that places a limit on the amount a contracting party can be charged if they default on an obligation. If a default fee is higher than what it actually costs the other party, then it will be deemed an unenforceable penalty and the courts will intervene to limit the amount of the fee to the actual cost incurred.
“We are not saying banks can’t charge fees, we are saying that they need to be fair and lawful,” Mr Hardwick said.
New Zealanders can join the action against unfair bank fees by registering at www.fairplayonfees.co.nz.