The customers of ANZ and ASB will make up one of the largest lawsuits of this type in New Zealand history.
The multimillion-dollar claim was filed in the Auckland High Court in 2021 against Australian-owned ANZ and ASB for failures to refund interest and fees to 150,000 customers.
The Court of Appeal's judgement found the approach where affected customers had to opt to join the class action placed unnecessary hurdles in the way of customers and what they were entitled to.
The lawyer leading the class action, Scott Russell, said it was a major win which could see thousands of homeowners paid back excess charges over nine years.
The ruling means every affected customer will be part of the class action unless they opt out.
"It not only removes a significant barrier for consumers who might have been unaware they had a right to participate, it means if we are successful, ANZ and ASB will be held liable for every eligible customer that was allegedly impacted when the banks breached New Zealand consumer protection laws - not just those who elected to participate in the class action," Russell said.
"It's notable that ANZ and ASB didn't tell their customers their consumer protection rights had been breached, or that they were entitled to have the interest and fees they'd paid refunded.
"Instead, the banks quietly did a deal with the Commerce Commission and hoped over 100,000 customers wouldn't figure it out."
He urged customers to contact their bank and ask for copies of their loan documents and communications.
The relevant periods are:
- ASB Bank customers: 6 June 2015 to 18 June 2019
- ANZ Bank customers: 6 June 2015 to 28 May 2016 (for loans entered into post 6 June 2015)
While ASB declined to comment, ANZ said it had already put customers back into a position where they would have been, had the issue not occurred, and was defending the case.
In a statement, ANZ said the High Court ruled in 2022 that class action would be opt-out, meaning customers would automatically be included, which ANZ had not challenged.
"The recent Court of Appeal hearing rejected the plaintiffs claim for a wider ANZ class and confirmed the High Court decision that the banking class action currently before the courts only includes ANZ customers who entered into a loan from 6 June 2015 and also received a loan variation letter that was affected by the calculator issue (i.e. received a letter containing incorrect information between 6 June 2015 and 28 May 2016).
"We have relevant records for customers who might be part of the class, which we will retain. There is no need to contact the bank at this stage. The Court will consider as part of the proceedings how and when to notify customers who are part of the class and who may have a claim."
ANZ said whether the plaintiffs had a claim was still to be determined.
The bank said once it realised the issue, contacted the Commerce Commission to alert it and acted quickly to correct it.
