Maurice Blackburn

Federal Court blasts ANZ over abuse of process in bank fees case

A Federal Court judge has today found that ANZ bank engaged in an 'abuse of process' and was proposing a 'fishing expedition' in its conduct of the class action over bank exception fees.

Justice Michelle Gordon has ruled that the case should not be delayed while the ANZ conducts an accountancy exercise involving an expert from Deloitte, London.

The decision found that the ANZ's request to delay hearing the core issues in the case while an accountancy exercise was underway would 'make a mockery' of the overarching purpose of the Federal Court.

"I do not accept that a Court should wait and conduct a trial of all issues in two or three years time. It is simply an inappropriate way in which to conduct this piece of litigation," she said.

Addressing the ANZ defence Justice Gordon said: "It is an abuse of process because the allegations are made…without any foundation."

Maurice Blackburn principal Andrew Watson said the historic decision was good news for the thousands of ANZ customers who have been charged penalty fees over the past six years.

"We are very pleased that the Court has rejected ANZ's attempt to delay the case and that this class action on behalf of ANZ customers can now proceed in an efficient and cost effective manner. It's in the interests of all concerned that we get to the heart of the case without any further delays.

"Justice Gordon has essentially dismissed the central basis of ANZ's defence - that the fees were not extravagant and unconscionable. She said the argument was 'unsubstantiated' and 'without any factual foundation'.

"Justice Gordon has also reminded the ANZ that it has obligations to its customers and that lawyers have an obligation to run the case without costly delays."

"This decision provides a 'roadmap' for the remaining bank fees cases involving other major Australian banks," said Mr Watson.

A further directions hearing will be held on 5 May 2011.

Background

Over 27,199  individuals and businesses holding 40,000 personal and business accounts are part of the ANZ class action. The bank penalty or 'exception*' fees imposed by ANZ to customers consist of honour and dishonour fees on bank accounts, and over limit and late payment fees on credit cards.

It is estimated that the total value of the ANZ class action to date is in excess of $50 million, with the average claim being around $1,500 per account holder and the range being from hundreds of dollars to over $35,000.

The legal action is being funded on a 'no-win no fee' basis by litigation funder IMF Australia Ltd and managed by its subsidiary Financial Redress.

ANZ customers can still join the class action at www.financialredress.com.au, email info@financialredress.com.au or call 1300 473 373

Editors' notes:

*exception fees are; honour fees and dishonour fees on bank accounts, late payment fees and over the limit fees on credit cards. They do not include ATM fees or monthly account fees.