Andrews v Australia and New Zealand Banking Group Limited [2012] HCA 30

HIGH COURT OF AUSTRALIA

FRENCH CJ, GUMMOW, CRENNAN, KIEFEL AND BELL JJ

JOHN ANDREWS & ORS APPLICANTS

AND

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED RESPONDENT

Andrews v Australia and New Zealand Banking Group Limited [2012] HCA 30 6 September 2012 M48/2012

ORDER

1. Leave to appeal granted in respect of grounds 1-4 of the amended draft notice of appeal.

2. The amended draft notice of appeal treated as filed and the appeal treated as instituted and heard instanter and allowed with costs.

3. Save as to sub-paragraphs (f)(i), (g), (h), (i), (k), (o)(i), and (p)(i) of order 1, set aside orders 1 and 2 of the orders made by the Federal Court of Australia on 13 December 2011, and in their place declare that the circumstances:

(a) that the honour, dishonour, non-payment and over limit fees were not charged by the respondent upon breach of contract by its customers, and

(b) that the customers had no responsibility or obligation to avoid the occurrence of events upon which these fees were charged,

do not render these fees incapable of characterisation as penalties.

4. Set aside the orders with respect to the costs of the Separate Questions made by the Federal Court of Australia on 7 February 2012, and in their place order that the question of costs be reserved for consideration by a judge of that Court.

Representation

J T Gleeson SC with J A Watson for the applicants (instructed by Maurice Blackburn)

A C Archibald QC with M H O'Bryan SC for the respondent (instructed by Ashurst Australia)

Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.

CATCHWORDS

Andrews v Australia and New Zealand Banking Group Limited

Banker and customer – Penalty doctrine – Consumer and commercial credit card accounts – Honour fee – Dishonour fee – Late payment fee – Non-payment fee – Over limit fee – Whether those fees penalties – Whether penalty doctrine limited to circumstances where there is breach of contract – Significance of law respecting penal bonds – Grounds for equitable intervention – Whether penalty doctrine now wholly a rule of common law.