What is a Fee Dispute?

Keith Koons

A fee dispute occurs when a consumer questions the validity of a charge that he feels another business is not entitled to. This type of inquiry is often associated with businesses like financial institutions or ones that operate within the service industry, but it could also apply to two individuals that can not agree on terms of an item or service. For example, if a buyer and a seller agreed to exchange cash for a vehicle, but they are located in different parts of the world, the seller would likely charge fees to recuperate the shipping and handling costs. If the buyer felt like the costs were unjustified, a fee dispute would take place that may ultimately have to be decided inside a court of law.

Woman holding a book
Woman holding a book

The vast majority of fee disputes involve two separate businesses or a business and an individual. An attorney or private investigator may provide a client a list of miscellaneous expenses that they incurred while performing services on his behalf, and some of these fees may seem questionable to the individual. A fee dispute in this instance would normally begin with the client contacting the professional directly in order to negotiate the overall cost of the services, and often a resolution is discovered without involving the judicial system. When an agreement can not be reached, then legal action can be implemented.

Many states and territories have specific rules pertaining to a fee dispute, and often strict time limits are enforced to ensure fairness to both parties. For example, when a creditor sends an invoice through the mail, the debtor normally has 30 days to respond, and failure to do so could result in an automatic judgment within a courtroom. Also, withholding funds that are legitimately owed during a fee dispute is illegal within many territories as well. If a consumer is seeking civil action against his landlord for failure to repair a leaky roof, he is expected by law to continue making his monthly rent or mortgage payments until the matter is settled.

Another common type of fee dispute occurs when lending institutions implement various fees and unexpected costs on a consumer or a business. Expenses like bounced check fees and over-the-limit fees can rapidly multiply to unrecoverable levels, and often individuals have no choice but to fight them. For example, if a person had $100 US Dollars (USD) within his checking account and issued twenty $5 (USD) checks, his balance should drop to zero; but in this instance, he forgot to record a previous $100 (USD) charge. The bank would, in turn, penalize the consumer with 20 separate fees ranging from $19 to $39 (USD) each plus an over-the-limit fee which could result in over $800 (USD) from one simple mistake. If the financial institution was not willing to remove the vast majority of those fees for the consumer, he would be forced to implement a fee dispute with its corporate office and, eventually, within civil court.

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