In Andrews v Australian and New Zealand Banking Group Limited [2011] FCA 1376 Justice Gordon of the Federal Court made preliminary decisions about which of ANZ Bank’s exception fees for a range of banking products may be penalties.

Different fees were charged for different events and for different types of accounts: Retail Deposit Accounts, Consumer Credit Card Accounts, Commercial Credit Card Accounts and Business Classic Accounts.

Justice Gordon decided that the Late Payment Fees in respect of certain credit card accounts are capable of being characterised as a penalty. On the other hand she concluded that the Honour Fees, the Dishonour Fees, the Overlimit Fees and the Non-payment Fees were not penalties.

No decision was made in relation to the amounts of the fees.

Her reasons considered banker-customer law, the history of the law of penalties, the current state of the law of penalties in Australia, the regulatory framework relevant to the Exception Fees (including the Corporations Act, the UCCC and the Banking Code of Practice) and each of the Exception Fees and the distinctions between them.

UPDATE 28 December 2011: The customer plaintiffs have lodged an appeal in their class action against ANZ challenging the ruling that honour, dishonour and overlimit fees were not penalties.