Determinations

TDR Case Note T010838 (2012)

Issue

Billings and fees

Background

The Customer transferred his home landline and broadband internet services to the Scheme Member Provider (Provider), because the Provider promised to "match" or "better" all of the Customer's telecommunuications costs, with the possibility of paying 35% of those costs in Batercard trade dollars. During the transfer process, the Customer advised the Provider that his internet data allowance was capped at a certain number of gigabytes, and that when he exceeded that cap his internet ran at dial-up speed, but he was not charged any additional fees.

After receipt of an initial invoice in December 2011, the Customer did not receive any further invoices until 20 March 2012 covering the previous three months, and the Provider also suspended the Customer's service in March 2012 due to non-payment. The Customer complained that he did not receive any warning of an overdue account or that his internet service was to be suspended. The Customer also complained that the Provider had not "matched" or "bettered" his telecommunications costs, because the invoices were a lot higher than those from his previous provider, up to 312% more. The Customer wished to terminate the services, but was advised by the Provider that early termination fees would be applied. The Customer transferred to another provider in May but the Provider continued to invoice him, including an invoice for May that included penalties, and an invoice for June with an outstanding balance of $1,470.

The Customer considered that the Provider had misrepresented the cost of its service, which was a breach of contract, sufficient to render the contract void without any early termination fees. The Customer was willing to pay what the previous provider would have charged, and said he would pay 65% of and the adjusted outstanding balance in cash and 35% with Bartercard trade dollars.

The Provider responded that the Customer’s increased bill related to broadband excess data usage. The Provider did not agree with the Customer’s position and insisted on payment in full of all its charges, late fees and early termination fee.

Adjudicator’s decision

The Adjudicator found that the Customer had advised the Provider of the arrangement he had with the previous provider regarding dial-up speed rather than extra charges upon reaching the data usage cap. The Adjudicator found that there was no agreement by the Customer to pay the excess data charges The Provider had therefore breached its contract with the Customer by applying excess data charges.

The Adjudicator also found that the Provider had offered to match or better all of the Customer’s telecommunications costs.

The Adjudicator noted that the Customer had received the first invoice in December 2011, which had included an amount for ‘excess data x 8 Gig November’ of $85.38.  The Customer should therefore have been aware of the excess data charging but chose not to cancel the contract until 11 May 2012.  The Adjudicator ruled that he should therefore pay the excess data charges from January 2012 until the date of cancellation.

The Adjudicator considered that because of the breach of its contract with the Customer, the Provider was not entitled to any penalty or disconnection charges. Nor was it entitled to the excess data charges for the first invoice in December 2011, as these were not included in the contract. Applying the “equal or better” contractual term, the Adjudicator found that the amount of $268.82 due under the December 2011 invoice should be reduced to $135.00.

Final outcome

The Adjudicator upheld the Customer’s complaint in part, and concluded that: (1) the Provider had breached its contract with the Customer, therefore no penalty or disconnection charges could be applied; and (2) the Customer had to pay the full amount for excess data from January 2012 until the date of cancellation, but no excess data charges were payable on the December 2011 invoice.