ON 8 APRIL 2015, the Full Court of the Federal Court of Australia delivered Paciocco v Australia and New Zealand Banking Group Limited  FCAFC 50 (8 April 2015).
BANKING AND FINANCIAL INSTITUTIONS – CONSUMER PROTECTION – whether various stipulations for fees are penalties at law or equity, or genuine pre-estimate of damage or compensation – whether the relevant stipulations were for breach of term of contract, collateral or accessory in the nature of security for, and in terrorem of the primary stipulations, or for a further contractual right or accommodation – the relevance of the “tests” in Dunlop Pneumatic Tyre Company Limited v New Garage and Motor Company Limited  UKHL 1;  AC 79 to the construction and characterisation of the provisions – whether the fees were extravagant or unconscionable – whether the charging of the fees constituted unconscionable conduct, unjust transactions or unfair contract terms under Australian Securities and Investments Commission Act 2001 (Cth), National Consumer Credit Protection Act 2009 (Cth), and Fair Trading Act 1999 (Vic)
LIMITATION OF ACTIONS – whether recovery statute-barred – construction of s 27(c) of the Limitation of Actions Act 1958 (Vic) – whether it applied to a mistake of law
The Full Court:
1.Dismissed an appeal by Paciocco against the decision of Gordon J of the Federal Court in Paciocco v Australia and New Zealand Banking Group Limited  FCA 35.
2.Allowed an appeal by Australia and New Zealand Banking Group Limited against the decision of Gordon J of the Federal Court in Paciocco v Australia and New Zealand Banking Group Limited  FCA 35.
The Full Court held that the bank fees in dispute were not penalties as it had not been proven that they were extravagant or unconscionable.
The Full Court also held that the fees were not unconscionable or unfair under the Commonwealth and State legislation concerning unconscionability, unjustness and unfairness.
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