Private schools in spotlight over ‘unfair’ fees

Parents are being slugged up to $10,000 for pulling their children out of private schools. But the exorbitant ‘penalty’ could actually be illegal.

Caulfield Grammar is among hundreds of private schools in Melbourne which charges such a fee. Picture: David Geraghty

Private schools in Victoria may not have the right to charge parents penalty fees of up to $10,000 if they do not give a term’s notice before pulling their child out.

Schools are now seeking legal advice on the validity of such policies which have been ruled unfair by an interstate tribunal.

Hundreds of Victorian private schools such as Caulfield Grammar, St Margaret’s Berwick Grammar, Melbourne Grammar, Huntingtower and Cook St Christian College have this fee clause.

Parents have long felt unfairly pressured by such rules, that can serve against the interests of children who may have a good reason to leave a school without waiting a full term.

Many such schools also have long waiting lists and high demand for places, meaning they can replace students without loss.

Schools are now receiving legal advice that says such policies are at risk if they are viewed as a penalty to frighten the parents into compliance rather than a genuine pre-estimate of the loss to the school.

The ACT administrative tribunal case involved Brindabella Christian College and parents who withdrew their children from the school at the end of 2019 without giving a full term of notice. The school argued that they were liable for the first terms fees of 2020 as a consequence.

Senior member Elspeth Ferguson ruled the notice must be a “genuine pre-estimate of the school’s loss in the event a child is withdrawn, rather than imposing a penalty upon the parents”.

She did not accept the school’s argument that a full term’s notice was a “bare minimum” required because if a child was withdrawn without notice the school may not be able to replace them “in a timely way”.

Melbourne lawyer Paul O’Halloran from Colin Biggers and Paisley agreed such terms “were not an accurate estimate of the loss of the school”.

“Schools unilaterally set school fees policies with no opportunity for the parent to terminate, and if there is no loss to the school from that withdrawal then it is an unfair term,” he said.

He said the ACT tribunal was not binding on Victorian schools but was “making schools nervous” and they were seeking advice about the legality of such policies.

Brindabella Christian College has changed its policy.