The High Court of Australia has announced that overcharging fees from customers can be a base to file a case against the banks.
The court ruled by hearing an appeal brought by 38,000 ANZ customers, which laid the way for the customers of eight banks to scrape back $220m in bank fees.
The High Court of Australia has favored that unfair bank fees can be considered penalties, in a class action being managed by law firm Maurice Blackburn Lawyers.
Maurice Blackburn class actions principal Andrew Watson said, "This High Court action represented an important moment in this case for the 170,000 customers currently involved in the class actions we are trying to recover a total of $223 million."
"We say the fees are excessive and extravagant – far beyond the actual cost of administration to the banks," Watson added.
The High Court said that only because certain types of fees were not levied when a contract was breached, it did not mean they were not penalties.
The full lawsuit covers over $230m collected from about 170,000 customers of Australia and New Zealand Bank Group, Commonwealth Bank of Australia, National Australia Bank, Westpac Banking Corp, Citibank, St George Bank, BankWest and Bank SA over the past six years.
Bank customers said that a number of exception fees, such as late payment fees, dishonor fees and over-limit fees, were unfair penalties and simply exceeded the cost to the bank of a customer overdrawing their account.
Customers were demanding that such charges levied by the bank were null and void and the charges collected from customers should be returned, although ANZ denies the fees are penalties.
Commenting on the High Court ruling, ANZ chief executive Philip Chronican said, "The High Court decision "does not provide a resolution for the class action participants. The matter will now return to the Federal Court. The High Court has not determined whether ANZ’s fees are penalties."