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sydney alternative media - non-profit community independent trustworthy
Thursday, 1 October 2009
Telstra shock enforced separation follows timing of billing price gouge on public
Mood:  surprised
Topic: aust govt

We wrote on a crikey.com.au ezine string perhaps a month ago along the lines of 'we can feel a class action coming on' regarding Telstra's arrogant attempt to alter their customer contracts unilaterally making a penalty fee of $2.20 admin fee for paying their bill over the counter.

That is, altering the custom for time immemorial to pay cash for a service direct to the service provider unless otherwise agreed specifically in a contract. We thought this could well amount to misleading and deceptive conduct by Telstra given the custom for time immemorial.

We even submitted a complaint to the ACCC competition and consumer authority about the contractual ambush. And we posted it here on the SAM news blog you can see below at the end of this article. Our concerns for instance: What if this penalty would have influenced choosing a different provider of a new service. What if one doesn't trust payment over the web for infamous security reasons? What if Telstra's bills have been inflated and reduced recently after complaints making a direct debit system unwise?

Counter to this have been the green campaigners - for instance on Sydney local abc radio recently promoting the idealistic paperless office as here, who rely on hardship concessions for difficult cases, and good luck with that. Similar to this presentation:

YouTube - Going Paper-Less But as Jon Dee explains, corporate paper dependency is a river of waste flowing through bu... ... The Paperless Office

and the good and worthy John Dee here too:

Putting paper reliance out with the rubbish - environment, Paper ... 21 Jul 2009

 

Notice the dating of this new payment penalty system as here being 14th Sept 2009 as per notices for the last 2 months in their printed bill:


Now notice the date for the shock defacto enforced separation announced by Minister Conroy, no doubt with an eye to various political factors like this above to millions of Telstra customers, and not least the tens of thousands of unionised workers, present or past.

Here are the terms of the ACCC response to our complaint still curiously unresolved, we posted here on 4th Sept 2009 as a media backgrounder part of our Sunday Political Talkies weekly media monitoring column:

2. Telstra price gouging, with interesting response from the ACCC here especially re unconscionable conduct of Telstra. They say not (see bold added below), but we wonder:

From: ecologya
Sent: Thursday, 23 July 2009 3:39 PM
To: Infocentre
Subject: Complaint form submission [SEC=UNCLASSIFIED]

Dear Mr McLoughlin, Thank you for your email of 23 July 2009 to the Australian Competition and Consumer Commission (ACCC) regarding the $2.20 fee Telstra is now imposing if customers choose to pay in cash. 

The ACCC administers the Trade Practices Act 1974 (TPA) for the purposes of protecting consumers and encouraging a fair and competitive business environment. 

From the information you have provided in your email it is unlikely that the conduct by Telstra would raise concerns under the TPA. If Telstra choose to increase their fees for services, they are free to do so. The ACCC is not a price setting body for goods and services at either the retail or wholesale levels. It does not have a direct role in regulating or setting prices except in the case of products or services that are declared under Part IIIA of the TPA. Internet service provision has not been declared under Part IIIA of the TPA. In these circumstances Telstra is free to determine its own pricing policies and provided that it does this independently it is unlikely to raise concerns under the TPA. 

Generally speaking, companies are free to set the terms and conditions of their contracts. The issues you raise are very specific matters of a contractual nature. While it is not the role of this office to provide legal advice, I would suggest you put your complaint in writing directly to Telstra in an endeavour to resolve your concerns. Should you still be dissatisfied, you may wish to seek independent legal advice on whether civil action might be appropriate. It is up to an aggrieved party to bring a private action if they believe they have suffered loss or damages as a result of any breach of the terms or conditions of a contract. 

Please note however,  that Telstra have included a clause in their contracts with consumers that provides for changes to rates and charges provided that they give reasonable notice of the changes. Clauses of this nature are sometimes referred to as unilateral variation clauses and are not, of themselves, prohibited by any provision within the TPA.   

That said, this office accepts that unilateral variation clauses can be a factor that the Courts will take into account in determining whether a corporation has engaged in conduct that might be considered to be ‘unconscionable’. In this regard s.51ABof the TPA includes a non-exhaustive list of factors which may be taken into account by the court. It should be noted that unconscionable conduct goes beyond normal harsh dealings and all of the circumstances need to be examined to establish whether a contravention has occurred. The Courts in applying this provision have often stated that simply establishing one of the factors listed in this provision is insufficient to substantiate a claim of unconscionable conduct. In this instance, this office is of the view that Telstra’s reliance on a unilateral variation clause to impose the price increase you complain of would not, of itself, result in the transaction being unconscionable. 

It may be of interest to you that Australian Communications & Media Authority (ACMA) administers a code of conduct for the telecommunications industry entitled “Consumer Contracts Code”. Held within this code is specific mention about unilateral variation clauses and it outlines the obligations of telecommunication providers when applying such clauses. To find out more information about this code you can contact ACMA on 1300 850 115 or by visiting their website at www.acma.gov.au. 

In addition, if you are seeking to exit your contract without penalty, you may wish to raise your concerns with the Telecommunications Industry Ombudsman (TIO). The TIO is an independent, non-government scheme which has been set up to assist consumers with speedy dispute resolution with their telecommunication service providers. Consumers should only contact the TIO if they have already attempted to resolve the dispute with the trader involved. The TIO can be contacted on 1800 062 058, or at www.tio.com.au 

I have recorded the details of your complaint in order to determine whether there is a pattern of behaviour by this particular trader or the telecommunications industry which may raise any broader concerns. Thank you for contacting the ACCC. I trust the above information is of assistance. Yours Sincerely,   FraserACCC InfocentrePh: 1300 302 502 


From: ecologya@
Sent: Thursday, 23 July 2009 3:39 PM
To: Infocentre
Subject: Complaint form submission [SEC=UNCLASSIFIED]

Complainant details

Mr Tom McLoughlin
NSW 2756
Australia
Age: 45-54
Gender: male

Contact details

Date received: 23rd July 2009

Product provider: Telstra
Product description: mobile, wireless broadband package

Complaint

I was a commercial litigation lawyer at Baker McKenzie in another life 1990-91. As per my phone message and email to Choice/policy officer Michael Fromme (spelling?) earlier today, Telstra changing their cash payment system adding a fee for EXISTING (therefore no notice) customers [reported on abc Richard Glover radio earlier this week] looks to me like deceptive conduct (breach s.52 Trade Practices Act). How? Because EVEN IF their contracts have fine print to alter these payment systems adding a $2.20 fee for processing casj (I don't know), it's been no fee FOR TIME IMMEMORIAL. It is totally reasonable for people to assume there will ALWAYS be no processing fee for cash. So they should ONLY be allowed to change the payment system for those who enter A NEW contract of service with NOTICE of potential change in payment system and fee. Otherwise the new fee is a deceptive omission to their original contract, and harsh and unconscionable too. For instance I recently took a mobile/wireless internet package, and I like to pay by cash not by the web because I don't trust it's security with account details and want to minimise that exposure as much as possible. If I had known they would change their account payment system with $2.20 fee when I took the contract/s in March 2009 I may well have decided to go with another provider. At least I would have wanted to know their extra fee per month

Additional information

---
IMPORTANT: This email from the Australian Competition and Consumer Commission (ACCC), and any attachments to it, contains information that is confidential and may also be the subject of legal, professional or other privilege.  If you are not the intended recipient, you must not review, copy, disseminate, disclose to others or take action in reliance of, any material contained within this email.  If you have received this email in error, please let the ACCC know by reply email to the sender informing them of the mistake and delete all copies from your computer system. For the purposes of the Spam Act 2003, this email is authorised by the ACCC
www.accc.gov.au

.......................

Earlier we noted 3rd August 2009 a response to a crikey.com.au 'tips and rumours' piece here of theirs on the same day:

Posted Monday, 3 August 2009 at 5:45 pm | Permalink

Regarding Telstra payment fee, as per my complaint submitted to ACCC and Choice, anyone who is on an recent term contract like for ‘broadband free modem offer’ which for wireless is something like 2 or 3 years, the question becomes:

How can a change of conditions of payment now with a fee AFTER the term contract of years (say 1, 2 or 3) has already been entered into, not be a deceptive and misleading form of conduct in the course of business (to quote s.52 of the Trade Practices Act 1974 (Commonwealth))??? No notice of this new term at the time of contract. No way to avoid it without exposure to other consequences like web insecurity with credit cards.

To me it looks like a Big Four Banks try on because payment by cash with no fee has been a A CUSTOM OF CONSUMER TRADE FOR TIME IMMEMORIAL. The extra fee is not foreshadowed in the original contact. You are now locked into an extra fee exposure when you might have chosen a different telco provider if you knew about this oppressive fee arising.

In my view (as ex commercial litigation lawyer) the only way this new fee is not misleading and deceptive conduct regarding existing term based telco contracts with monthly billing is a renegotiated contract or a completely new contract is commenced or an option to cancel immediately is agreed.

That’s not the case with my 3 year wireless supply contract. And I don’t want to pay by credit card online because the web is not secure. I can feel a class action for misleading and deceptive (and unconscionable) conduct coming on say … about 14th September 2009.

Stay tuned.


 

 


Posted by editor at 10:03 AM NZT
Updated: Thursday, 1 October 2009 10:31 AM NZT

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