VANCOUVER – A class action lawsuit filed has been filed in the Federal Court of Canada against Shaw Cablesystems alleging the company does not properly disclose the interest it charges on overdue accounts.
The suit was filed January 31, 2011 by the law firm of Poyner Baxter of North Vancouver (which also issued the press release), alleging a violation of the federal Interest Act. Such a suit is typically brought in the name of one or more individuals as "representative of a class," and, if successful, would apply to all charges imposed by Shaw on overdue accounts during the past six years pursuant to the Statute of Limitations, says the release.
"Shaw’s practice of charging an interest penalty on overdue accounts is neither uncommon nor illegal, nor is the rate of two per cent," said lawyer Jim Poyner. "However, the Interest Act specifically requires that the annualized rate be fully disclosed to consumers which, in this case, is two percent compounded monthly, effectively 26.8% per annum. If not disclosed, the law is very clear: the maximum rate that can be charged is five per cent per annum."
Most firms comply with the law by clearly stating all penalties on their statements, continues the release. Others provide direct links to specific information on their web sites. "No such information or direction exists on the Shaw statements. If one mines down deeply enough on the Shaw web site, the information can be found, but those who can find it deserve a prize," Poyner said.
"Invoices sent by Shaw to its subscribers… stipulate that amounts owing after the ‘billing date are subject to an interest charge, calculated at 2% per month, compounded monthly’. In contravention of the Interest Act… Shaw has failed and continues to fail to state on its invoices what the annualized interest rate upon compounding the said monthly 2% interest charge and as a result thereof, the Plaintiff and all other putative class members have sustained damages," reads the Statement of Claim.
The Statement of Claim filed in the Federal Court cites "egregious conduct" and seeks a refund, interest and costs on behalf of all Shaw customers who paid overdue penalties during the past six years. No amount is mentioned in the Statement of Claim.
Shaw has yet to respond publicly. We’ve asked for comment, so stay tuned.
