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VIC Debt Collection and Private School Fees Contract

Discussion in 'Debt and Bankruptcy Law Forum' started by schoolfeetrouble, 21 February 2015.

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  1. schoolfeetrouble

    21 February 2015
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    I enrolled my son in a private school early learning centre. We paid an enrolment fee of $100 to be added to a waiting list and then paid a further $800 to confirm his place when we were notified that there was one available. When we paid the $800 we signed an enrolment contract which said that we would give a terms notice if our son was no longer going to attend the school and if we didn't we would be liable for a terms worth of fees.

    This school wasn't our first preference and we weren't notified by our preferred school until the beginning of year. When we were offered the place we accept and I gave notice to the original school that we would not be attending. They then contacted me to say that we would have to pay the first term's fees. I didn't realise this would be the case but I did sign the enrolment contract so this is partially my fault for not reading.

    Anyway I said I couldn't pay the fees because reality is I can't pay two sets of school fees. I spoke to a friend who is a registrar at another school who said that a school could only legally chase for the fees if they weren't able to fill the spot and could then try and recoup monies lost. So based on this I had a friend ring up and enquire about places in ELC3 and she was told there were not places available. Based on this I thought that was the end of it. But I yesterday received a letter from a debt collector saying that I owe the school the money. I hadn't received any other notification from the school about payment i.e. a reminder notice or anything. the original bill, a phone call I then made to say I couldn't pay because he wasn't attending the school and now a notice from the debt collector.

    So my question is can they force me to pay? If they have filled the spot then they are not down on money?

    The contract talks about giving a terms notice but my child never attend the school so is that a loophole I can use? A term technically doesn't mean anything to me as he actually never attended so how could I give that terms notice?

    Also I feel like the debt collectors notice is a bit of a scare tact; they have not tried to recover the money from me at all the just sent it straight to the debt collector.
  2. Sarah J

    Sarah J Well-Known Member

    16 July 2014
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    Hi Schoolfeetrouble,

    Have you contacted the Victorian Department of Education? I understand this is a private school and so the department may not be able to help, but it is worth a try. There may be some legislation in Victoria that governs how much a school can charge for fees and under what conditions they are allowed to charge. The Department may be able to point you in the right direction here.

    Other contacts:
    In fact, I would start with Consumer Affairs Australia.

    Hope this helps.
  3. Sophea

    Sophea Well-Known Member

    16 April 2014
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    The reason that your friend said that schools can only claim a term's school fees from you if they don't fill the place with another student and therefore suffer a loss, is because contract law states that penalties are unenforceable in contracts. This means that you cannot impose a penalty on the other party to the contract if they do not perform their end of the contract. UNLESS, it represents your actual business loss resulting from the other party not upholding their end of the contract.

    Therefore, if you can prove that the school did not suffer a loss, and that they filled your child's place and got the school fees that you would have paid then you may have grounds to fight the debt that they are trying to collect from you.

    I would write them a letter stating that what they are charging is a penalty and does not represent any actual loss or damages recoverable by them and is therefore unenforceable.

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