Determinations

TDR Case Note T003685 (2009)

Issue

Billings - charging of voice calls for dial-up internet connection, Telecommunications Service Obligations (TSO)

Background

The customer entered into a contract with the Scheme Member Provider (provider) for the provision of home telephone services in Auckland in 1998, on a plan that excluded free local calling.  In September 2008, 10 years later, the provider began billing the customer for local calls but those made between 1998 and 2008 were not charged. In fact, the customer had a dial-up internet service with an Internet Service Provider (ISP) using the prefix 0867 for connection. The provider charged calls from the customer to this number as local calls. The customer lodged a complaint about this charge, pointing out that the provider did not give prior notice about billing these calls. He also said that the provider’s terms and conditions did not mention any charge for dial-up internet calls.  He further claimed that the 0867 number did not meet the criteria for a local call made in Auckland when his ISP was based outside of Auckland.

The provider denied that it had failed to notify the customer of the 0867 call charges. In fact, the customer’s local calls had been payable since 1998 but the provider had simply failed to bill for these. The Telecommunications Service Obligations (TSO) Deed defined ‘local calls’, which included local calls for dial-up internet access.  The provider submitted that the TDR service had no jurisdiction to consider the definition of local calls.  However, the provider offered the customer a goodwill credit of two months’ local call charges for omitting to notify him of its error in not billing the 0867 calls.

The customer responded that the TSO did not come into effect until 20 December 2001, and that the 0867 calls before that date were not chargeable.  He submitted that the provider has therefore breached clause 10 of the Customer Complaints Code (Code).
Adjudicator’s decision: The adjudicator found that there were essentially two issues, (1) whether the provider could charge for the calls to ISPs as local calls and (2) whether the provider should have given notice of the charges to be imposed.

With regard to charges for the calls to ISP, the adjudicator found that the contract between the provider and the customer provided for a charge for local calls. The TSO defined local residential telephone service as including local residential dial-up data services and included 0867 numbers.
The adjudicator found that there had been no breach of clause 10 of the Code.  The Code only came into force on 30 November 2007, so any complaints about matters before that date were excluded from its scope.

The adjudicator also found that there was no breach of the Provider’s Residential Terms and Conditions, which enabled the provider to charge for local calls if the customer had selected “one of the available alternatives to the standard residential line rental”.  The provider was entitled to charge the customer for the cost of his local residential dial-up service.

With regard to giving notice of the charges, the adjudicator found that there was no change to the terms of the agreement made in 1998. Those terms included charges for local calls. The customer was therefore liable for cost of local calls and the provider was under no duty to notify the customer of a change to his billings. The provider made an error by a failure to bill for the local calls over the 10 year period and simply commenced billing for services as provided for in the agreement. The adjudicator found that there had been no breach of the Code.

Final outcome

The adjudicator concluded that there was no breach of either the contractual terms between the parties or of the Code. There were therefore no remedies awarded.