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After the comment left on my previous post regarding the return of unfair and unreasonable bank or credit card charges (e.g. late payment or exceeded credit limit charges) I have located a copy of the letter which I sent my bank regarding the same.

Of course, this is under English law, so must be used for an institution to which English law applies…

View the letter to my bank here.

You’ll note that there are several points relating to my specific circumstances, but all precedents applied and statutes quoted are accurate and largely applicable to all unfair contract terms similar to this (unfair bank or credit charges).

The main aspect to remember is that their (the bank, credit card company, or other financial institution) charges must represent the actual costs relating to any breach of terms (i.e. missing a credit card repayment) and cannot be used as a means for making profit. To penalise in such a way would represent a “penalty clause” which is against the relevant statutes cited in the letter.

Now, I am not sure, but much of Australian state and federal law is based largely on English law (and occasionally vice versa) particularly due to the commonwealth relationship. For example, precedents from Australian state law are often cited in English cases (as well as, I’m sure, the other way around). What this means, then, is that there may well be some similar argument against the charges levied by Australian financial institutions – though I am by no means certain of this! Perhaps someone can clear this up?

In any case, it would be interesting to know exactly how Australian law (at state and federal levels) regards such charges…