Telstra to face ‘late payment fee’ class action

Telstra customers who have paid a late fee to the giant telecommunication company are set to benefit from a multi-million dollar class action to be run by the specialist law firm ACA Lawyers.

The Telstra class action is being backed by one of the UK’s leading litigation funders, Harbour Litigation Funding.

The legal proceedings will target Telstra’s ‘late payments fees’ which ACA Lawyers will argue represents an unlawful penalty because it does not reflect the actual loss to the company caused by the late payment.

ACA Lawyers also announced proposed class actions against Optus and Vodafone who charge similar late payment fees.

Mr Steven Lewis, Principal with ACA Lawyers, said the action was about justice for the clients of Australia’s major telecommunications companies.

“Last week Telstra announced a massive profit which is built in part on revenue from late payment fees often collected from families who can least afford it,” Mr Lewis said.

“Since 2000 hundreds of thousands of Telstra customers have paid late fees in the mistaken belief Telstra was entitled to charge the fee.

“But a recent court decision in relation to credit card fees found that late payment fees charged by banks are unlawful and that clients are entitled to get most of their money back.

“We will argue this is the same for the late payment fees charged by Telstra, Optus and Vodafone,” he said.

The announcement of the legal proceedings comes in the wake of Telstra last week posting an after-tax profit of $4.28 billion for the past financial year.

The company’s financial statement indicates it collected some $272 million for ‘late fees and other miscellaneous fees’ in the 2014 financial year.

Telstra’s accounts for the four years from July 2009 indicate the telco may have collected a further half a billion dollars in late and miscellaneous fees over those years.