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Judgment on Australian Bank Fees Case

05 February 2014

Judgment on Australian Bank Fees Case

Today her Honour Justice Gordon of the Australian Federal Court delivered judgment in the Australian Bank Fees case, Paciocco v ANZ.

Her Honour found that late payment fees charged by the ANZ were illegal and ‘extravagant, exorbitant and unconscionable’. Lawyers for the plaintiffs claim the ruling is set to change the banking landscape in Australia.

Fair Play on Fees lawyer Andrew Hooker says, “We have been closely monitoring the progress of the Australian bank fees case because, although there are differences between the Australian and New Zealand laws, it will provide our legal team with some important guidance on how best to represent the needs of New Zealanders in the bank fees case in New Zealand.

“From what we heard in the Federal Court today, Fair Play on Fees think the outcome of the case bodes well for its case in New Zealand.

“The case has wide reaching effect for bank customers across Australia, and will be helpful for our legal team to review and determine how best to characterise the New Zealand case against the banks.”


In 2012, the High Court of Australia decided that a breach of contract was not necessary to show that a fee was a penalty. This signalled a significant shift in the way many had understood the state of the law to be and is an important strategic win for the Australian bank customers’ ability to show that the fees are illegal.

In the December 2013 Australian Federal Court trial of Paciocco v ANZ, lawyers for the plaintiffs claimed against the ANZ bank by alleging that the bank charged exorbitant fees of between $20-$45 for a service that cost them only a matter or cents or a few dollars at the most to administer. The plaintiffs argued that charging these amounts was effectively a penalty and the banks were illegally charging its customers and should repay the fees. The lawyers for the ANZ bank argued that the fees were commensurate to the service provided to its customers in managing their accounts and transactions.


Justice Gordon today ruled that the late payment fees the bank charged customers were invalid. But her Honour also said that other fees the bank charged, including honour and dishonour fees, over-limit fees on credit cards, were reasonable and were not penal in character. Her Honour therefore found that banks could charge its customers these kinds of fees legally.

While the Court’s decision is being lauded as a partial victory for bank customers, the lawyers for the plaintiffs have announced they are reviewing the judgment and considering their options.

The team behind the case is New Zealand lawyer Andrew Hooker, Australian class action experts Slater & Gordon and litigation funder Litigation Lending Services. The litigation is structured to ensure claimants have no upfront costs and nothing to lose by joining the action. All legal services are provided on a no win, no fee basis.

New Zealanders can join the action against unfair bank fees by registering at:


About Andrew Hooker

Andrew is an Auckland based lawyer specialising in civil litigation. He has more than 20 years’ experience in insurance related litigation. Prior to working as a lawyer Andrew worked in claims and sales for a major New Zealand insurance company and also set up and ran a nationwide specialist insurance investigation company.

About Slater & Gordon

Slater & Gordon is Australia’s largest consumer law firm. For 75 years, Slaters have been standing up for the rights of ordinary working people, not big companies. Slater & Gordon have been pioneers in Australian class actions over the past 25 years. They will be lending their expertise in tough, large-scale litigation to this case as legal advisors.

About Litigation Lending Services

Litigation Lending Services is a litigation funding firm which will provide financial support to the case. Its parent company, Litigation Lending Services, has been operating for over 13 years in both Australia and New Zealand. Having established itself funding general commercial claims, the company has expanded over the past five years and has also funded a number of successful class actions.

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