Charging a customer $98 because of a 45-cent overdraft is one of the reasons TD Canada Trust faces millions in claims under a proposed class action lawsuit on behalf of every customer charged an NSF fee in the past ten years..Ontario Superior Court upheld a complaint from one depositor charged $98 in NSF fees over a 45-cent overdraft..“These are genuine issues,” wrote Justice Edward Belobaba..The question was whether the Toronto Dominion Bank properly notified customers they could be charged multiple fees for bouncing the same cheque, he added..Tyler Dufault of Trenton, ON, a longtime TD customer, in 2020 made a PayPal payment worth $19.49 with only $19.04 in his account..“I understand if I had insufficient funds in the savings account to cover the amount of the transaction, TD Bank could charge me, at most, a single NSF fee if it decided to reject the payment,” Dufault wrote in a Court affidavit..TD initially charged $48 for insufficient funds. It then charged a second $48 fee when PayPal four days later electronically resubmitted the same payment demand for the same purchase..The bank contract with depositors stated only a single NSF fee would apply..Belobaba called it a “standard-form ‘take-it-or-leave-it’ contract.”.“The plaintiff does not question the bank’s right to charge additional service fees for additional services provided the additional fees are fully and fairly disclosed,” wrote Belobaba..“There is nothing in this fee disclosure provision about the bank’s right to impose a second NSF fee when someone else, a third party payee such as PayPal, re-represents the rejected payment.”.“The issue here is not whether PayPal was wrong to re-present the rejected payment — it wasn’t — or whether the bank was wrong in theory to charge a second $48 NSF fee for the additional expense of processing the re-presentment — it wasn’t. The issue is whether the bank fully and fairly disclosed the possible imposition of this second NSF fee in the fee schedule of its consumer banking agreement.”.The court rejected TD lawyers’ request to dismiss the claim and ordered the Bank to pay $120,000 in costs. A ruling is pending on whether to certify a class action claim on behalf of thousands of TD customers charged NSF fees since 2010..Dufault’s lawyers noted the bank settled at US$41.5 million in a similar class action claim in New York..The bank collects $2.9 million a year in service charges, including NSF fees.
