A recent case was considered by the ACT Civil and Administrative Tribunal (ACAT) in relation to whether charging a fee equal to a terms tuition fees in lieu of notice in an enrolment contract was unfair. This case has been widely reported and published in the news and may have been brought to the attention of many parents.
The parents in this matter advised class teachers during an end-of-year meeting in 2019 that the children would not be returning to the school in 2020. The parents subsequently filed an online form and emailed the school’s administration and enrolment office. The school then claimed full fees for each child for the first term of 2020.
The relevant term was set out in the school’s enrolment contract as follows:
One full College term’s notice in writing to the Principal is required for the intended withdrawal of the child, otherwise a full term’s fees will be charged. The written notice must be received at the College by the first day of term. Any notice received after the first day of term will render parents/carers liable for the fees for that term and the subsequent term in lieu of notice.
The arguments raised by the parents were that, whilst it was accepted that the withdrawal of the parent’s children was not made with a full term’s notice, the contract was allegedly unfair by imposing a penalty on the parents for services they neither requested nor accessed.
ACAT found that the notice term in the enrolment contract was void pursuant to section 23 (1) of the Australian Consumer Law (ACL). In making this decision, ACAT considered several factors namely:
Ultimately, ACAT determined that since the children were withdrawn at the end of the school year, the school would have sufficient time to plan and allocate teaching resources for the following year and could thus mitigate any loss occasioned by the termination of the contract. The parents were therefore successful in setting aside the term of the contract.
This is an important decision for AMPAC’s school clients. Where a school’s enrolment contract requires notice to be given, such notice should reflect a reasonable period for the school to make further arrangements (for example, allocating teaching resources or accepting the enrolment of another child). Where fees are due in lieu of notice, those fees should represent a reasonable pre-estimate of the school’s loss and not impose a penalty on the parents.
To discuss this important topic in more detail, or for further information about AMPAC’s services, please contact us on 1300 426 722 or firstname.lastname@example.org
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