Getting a Refund of Overdraft Fees

[ESCO]

Subject: CONSUMER LAW
My retired parents were recently talked into to purchasing a living will service by a field service representative that visited their home. They were told to post date four checks, one for $350.00 and three more for $715.00. They gave the company’s sales representative the check to send along with their paperwork he had gathered.

Since, I assist them with their finances, and was told what they had did, I immediately told them to cancel the service because the simply couldn’t afford it at the present time.

The services contract was signed on the 7th of April. Both of my parents called and canceled the service on the 12th of April over the phone which was documented on the company’s database. My mother also filled out a cancellation form and mailed it on the 9th of April that was left with her by the company’s representative with the instructions it could be cancelled with 30 days.

One of the checks that were post dated for the 7th was cashed by the company on the 18th of April causing my parents register to be $715.00 in the negative. This check bounced followed by six more that cost my parents a total of $215.00 in overdraft fees.

I contacted the company on the 25th of April asking the company when the were going to pay my parents back the $715.00 for the check they unrightfully cashed, and also ask them about reimbursing them the $215.00 overdraft fees they had caused them to have for bouncing seven checks following their transaction.

I was forwarded to a member of management which informed me that the company would reimburse my parents for the $715.00. But, all they could offer for the overdraft fees that this company caused was an apology.

I also contacted the bank and ask them to waive the fees, and they would not because it was not their fault.

My question is: Can this company be forced to pay back these overdraft fees (which I can prove the caused) or should they just chalk it up as a bad experience?

Any advice would be greatly appreciated. Thanks

[aaron]

My retired parents were recently talked into to purchasing a living will service by a field service representative that visited their home. They were told to post date four checks, one for $350.00 and three more for $715.00. They gave the company’s sales representative the check to send along with their paperwork he had gathered.

What in the world were they getting for that money?

The services contract was signed on the 7th of April. Both of my parents called and canceled the service on the 12th of April over the phone which was documented on the company’s database. My mother also filled out a cancellation form and mailed it on the 9th of April that was left with her by the company’s representative with the instructions it could be cancelled with 30 days.

Was this a person who came to their door on his own initiative, or somebody they invited? If it is the former, they may have remedies under the FTC's 3-day "cooling off period" regulation, which would allow them to cancel the contract (and recoup all moneys) if they cancelled within three business days - and possibly a longer period if they were not properly informed of their rights. There may be similar provisions under Georgia law.

I was forwarded to a member of management which informed me that the company would reimburse my parents for the $715.00. But, all they could offer for the overdraft fees that this company caused was an apology.

The argument can be made that the demand for and acceptance of post-dated checks was in essence a contract that the checks would not be deposited before their dates (which, presumably, were made out pursuant to the instruction of the company), with overdraft fees being a foreseeable consequence of the violation of such a contract. Similarly, it is foreseeable that if you cash a check for a service that has been cancelled, the funds which might otherwise have been in an account to pay for that service wouldn't be there, again with a foreseeable consequence that there could be overdraft fees. You may wish to consider accepting the refund check, then filing a small claims suit for the balance.

I also contacted the bank and ask them to waive the fees, and they would not because it was not their fault.

Banks generally contract with their customers that post-dated checks may be processed at any time, and the Uniform Commercial Code provisions on the subject are favorable to them, so they will likely stick to their guns.

[ESCO]

You ask about what they were getting for that amount on money? In my opionion, nothing that could not have been handled by myself.

Unfortunately the sales person was invited to their home because he confronted my mother in a local restuarant and my mother can never say "NO".

The small claims court was an option I had considered until I found out the claim had to be filed in the state were the person or company was, and that would be Texas.

Someone told me to try writing a firm letter to the company asking for the overdrafts again in writing, threatening small claims court, but I don't forsee the small claims court as an option because it's in a different state.

What do you think about just writing them a letter?

[GreatGadsby]

you shouldn't have to sue them in texas. i thought you could sue where the contract was entered into, presumably georgia.

[aaron]

Is your parents' home in Texas? Because if the sale occurred in Georgia, as GreatGadsby suggests, you should be able to sue there.

[ESCO]

I will definitely persue the small claims court option now that I know I can persue it in Georgia, since that's where my parents live, and that's where the contract was made. Obviously the person I got the info. from that told me the small claim action had to take place in the state or county where the company was incorporated was incorrect.

Thanks again (both of you) for your help