Author: Mark Fletcher

The Banking Industry Ombudsman website has some helpful information for canceling a direct debit which may be useful to newsagents who have had payments deducted for Bill Express equipment this week even though they had cancelled the direct debit authority with their bank.

If you have given a third party an authority to debit your account, that authority may be cancelled either by notice to the third party and/or by notice to the bank. This is reflected in clause 19 of the New Code of Banking Practice, which says that a bank will promptly process your instruction to cancel a direct debit request and will not direct or suggest that you should first raise any such request directly with the third party. The bank may suggest that you also contact the party and this is a prudent course to take to ensure that the authority is cancelled.

Newsagents who cancelled their direct debit authority and had money taken our for the Bill Express equipment this week ought to make representations to their bank about how this is a breach of the Code of Banking Practice.

If your bank refuses to refund the money they allowed to be deducted after you cancelled the direct debit authority, you should advise them you will make a complaint to Financial Ombudsman Service.  Click here for details of how to register your dispute online.

Mark Hawthorne at The Age today continues excellent reporting on Bill Express and the collapse of OnQ.

We have spoken to the Administrators of OnQ and they have provided a formal proof of debt form. This will need to be completed and lodged with Worrells in advance of any creditors meeting. My view is that OnQ is indebted to my newsagencies for the rebates as documented in Schedule D of the Bill Express agreement.

While there is no money in OnQ, by registering as a creditor newsagents can at least have a voice at the table as the last rites are performed and therefore hopefully be better informed. I will publish an updated example of the form completed later today.

When a creditors meeting is announced I will publish details here along with a proxy form.

Meanwhile, a group of around 20 newsagents yesterday met with representatives of the ANF in Melbourne. Most of the meeting was taken up with Bill Express matters. The difference between the ANF approach and that of the team behind the NSW instituted Class Action was evident. The ANF approach is to negotiate a settlement of the Mobius debt newsagents have been saddled with. The NSW Class Action approach is to challenge the debt on the basis of legal precedent. As I blogged here last week there are precedents worth considering.

The major flaw in the approach the ANF is taking is that it accepts that the equipment rental agreement is separate to the Bill Express agreement. That acceptance leaves the ANF strategy pursuing an outcome which is unacceptable to newsagents. Unless the ANF changes its approach or communicates its reasoning in a more convincing way it will continue to lose members on this issue.

The ANF Directors needs to practically and publicly demonstrate that they will pursue the Mobius agreement issue until the very end and that they will put the needs of newsagents ahead of their own. If they are not prepared to do this they ought to resign. On the evidence so far this year, the Directors of the ANF have not put the needs of newsagents ahead of their own.

My understanding is that the majority of newsagents attending the meeting in Melbourne with the ANF yesterday signed up for the NSW Class Action and not the ANF strategy.

OnQ, the parent of the collapsed Bill Express company, has announced the appointment of administrators.  This move was only a matter of time given once Bill Express collapsed.

I am a creditor of OnQ as are most newsagents.  The Agreement I signed commits the company to paying rebates as outlined in Schedule D attached to the Agreement.  While the company will claim that it varied the Agreement, I’d like to hear how a judge views that.  In the meantime, I’ll register as a creditor.  If I get a form for this I will post it here.

I will be interested to see what happens now with ETT, a public company 43% owned by Bill Express.  If it collapses that will be three related  ASX listed companies collapsing.

On the weekend I checked my Bill Express and Mobius equipment agreements and noticed that the document version markings, in fine print on the lower left corner of each page, matched.  These common markings link the Bill Express and Mobius equipment finance agreements.

Much has been made about these agreements being separate.  The ANF in its communication to newsagents makes it clear they view the agreements as separate.  While I am no lawyer, I would have thought that a court would find it relevant to its considerations that agreements intended to be separate would have the same version markings.

The status of these agreements is of grave concern to newsagents across the country.  It concerns me that not enough is being done by the ANF to address this situation.

A Victorian newsagent wrote to his bank a week ago seeking a refund of the funds taken from his account by Mobius for the Bill Express equipment. His letter sought the refund on the basis that the direct debit authority he signed for the Bill Express equipment was in favor of Technology Business International. Yesterday morning, checking his account, the newsagent found that his bank had refunded payments it has deducted without his authority since March this year.

This is a tremendous outcome.  Good on the bank for realising that it did not have the right paperwork to allow such a withdrawal.

At Networked Knowledge Dr Robert N Moles publishes material about alleged serious miscarriages of justice.  In one post, Contract Law Lecture, Moles writes about contracts and reasons for termination.  In citing the case of Foley v. Classique Coaches Ltd, Moles writes:

A problem will arise if the machinery provided for in the contract breaks down for reasons over which the parties have no control. The traditional common law rule was that if the means for ascertaining the price failed, there could be no contract.

Newsagents entered in to a contract to finance equipment to operate the Bill Express and DialTime services, at the same time they entered into a separate contract for the provision of the Bill Express / DialTime services.
I am sure the legal experts representing newsagents are looking carefully at the status of the finance contracts given that the purpose of the machinery provided under the contracts contract has failed.

I have been contacted by several newsagents in the last 24 hours about the role of the ANF in promoting Bill Express to new newsagents at the ANF run newsagents training course. In each case they say the ANF participated with Bill Express employees in promoting Bill Express to new newsagents. This included talking up the rebates. I am told there was no mention that the rebates could be removed at any timer.

One newsagent told me that they explicitly asked the ANF representative if the ANF had checked Bill Express out. The answer was they had and that it was a good deal. The ANF staffer did not disclose that they worked for an organisation which made a commission from its endorsement of Bill Express.

Keeping its own arrangement secret meant that newsagents did not have all relevant facts when considering the advice on the ANF on Bill express.

Some associated with the ANF put it about that I am obsessed with the organisation. This is not the case. I am concerned that the ANF did not disclose its own commercial relationship with Bill Express each time it promoted Bill Express to newsagents.  I have put these and other issues to the organisation and it has not responded.