The term allowed PayPal to keep fees that it had erroneously charged if the small business involved didn't notify PayPal of the mistake within 60 days.
The financial technology company had already voluntarily removed the clause from its contracts on November 8 last year, two months after court proceedings began.The Federal Court has now declared the term void from the start of the contracts and ordered that PayPal be restrained from applying, relying on, or enforcing, the term in its contracts with small businesses.
He also found that, as well as only having 60 days to notify PayPal of any errors, the account statements provided did not clearly detail the types of fees and manner in which they were calculated in a way that was easily reconcilable, making it difficult for small business owners to identify any errors.