Police Dept Employees' Credit Union v Flood

The case of Police Dept Employees' Credit Union v Flood arose from a dispute between the Credit Union and Ms Flood, a former member, regarding the validity of certain charges and fees imposed on her credit account. The dispute was heard by the Federal Circuit and Family Court of Australia. The Credit Union sought to recover fees and interest from Ms Flood, arguing that she had breached the terms of her credit agreement. Ms Flood, on the other hand, contended that the Credit Union had breached the Consumer Credit Code by imposing unauthorised fees and interest charges, among other things.

The court was required to determine several key legal issues, including whether a pre-Code continuing contract could be partly in writing and partly not in writing, and whether the Credit Union had imposed a fee and an interest charge in breach of the Code. The court also needed to decide whether the opening and closing balances in statements of account must be correct in fact or correctly reflect the credit provider's books, and whether a statement of account should include interest actually debited or only interest properly debited. Additionally, the court had to consider whether insurance particulars previously disclosed in accordance with the Code were sufficient, whether credit was limited to a period not exceeding 60 days, and whether overdrawn credit constituted the provision of credit without prior agreement, thereby excluding the operation of the Code. Finally, the court needed to determine whether charges were payable even if credit facilities were not available.

The court found that the Credit Union had breached the Consumer Credit Code by imposing unauthorised fees and interest charges on Ms Flood's account. The court held that a pre-Code continuing contract could not be partly in writing and partly not in writing, and that the Credit Union had breached the Code by imposing a fee and an interest charge. The court also found that the opening and closing balances in statements of account must be correct in fact, and that a statement of account should include interest actually debited. The court held that insurance particulars previously disclosed in accordance with the Code were sufficient, but that credit was limited to a period not exceeding 60 days. Finally, the court found that overdrawn credit constituted the provision of credit without prior agreement, thereby excluding the operation of the Code, and that charges were not payable if credit facilities were not available.

The court ordered that the Credit Union pay Ms Flood's legal costs and dismissed the Credit Union's claim for recovery of fees and interest.