Group RESP (Registered Education Savings Plan) Unlawful Enrollment Fees and Sales Charges – Quebec Consumer Class Action

Case name

Quebec Class Action for illegal fees charged by CST, Universitas, Heritage, Children’s, Global and Knowledge First;

Quebec Superior Court file #

500-06-000803-169;

Violations

Plaintiff alleges that the sales charges and/or enrollment fees charged by all of the Group RESP providers in Quebec, without exception, are unlawful. Indeed, section 1.1 (7) of Regulation No. 15 Respecting Conditions Precedent to Acceptance of Scholarship or Education Plan Prospectuses, c. V-1.1, r. 44, provided that:

“The fees charged, including the commissions of the distributor and its salesmen, must not exceed $200 per plan. The first $100 paid under the plan may be applied against this fee and the balance may be deducted at a maximum rate of 50% of each of the further contributions”.

Proposed Class

All natural persons, who at any time since July 19th, 2013 (the “Class Period”), while residing in the province of Quebec, had a contract with any of the Defendants in which they were a subscriber and/or contributor (either primary or joint) for a Registered Education Savings Plan (“RESP”), and who were charged a fee (referred to as “Enrolment Fee”, “Sales Charge” and/or “Membership Fee”), including the commissions of the distributor and its salesmen, exceeding $200.00 per plan;

Proposed Subclass 1

All natural persons, who at any time since July 19th, 2013 (the “Class Period”), while residing in the province of Quebec, had a contract with any of the Defendants in which they were a subscriber and/or contributor (either primary or joint) for a Registered Education Savings Plan (“RESP”), and who incurred the complete forfeiture of the capital and accumulated interest in their RESP because it was abandoned before its maturity;

Proposed Subclass 2

Proposed Subclass 2:  

All natural persons, who at any time since July 19th, 2013 (the Defendants  “Class Period”), while residing in the province of Quebec, had a contract with any of the Defendants in which they were a subscriber and/or contributor (either primary or joint) for a Registered Education Savings Plan (“RESP”), and whose RESP Agreement included the following clause (or similar thereto) with respect to the Sales Charges, Enrolment Fees and/or Membership Fees:

You acknowledge that a sales charge of $_____ (_____ units x $200 per unit) is deducted from early contributions.

The sales charge is deducted from your contribution as follows:

All of your contributions are applied to the Sales Charge until it is one-half paid.

After that, only one half of contributions will be applied to the Sales Charge until it is fully paid.

Remedies sought for consumers

Plaintiff was charged $7800.00 for 3 of his RESP Group plans and is seeking reimbursement of the difference unlawfully charged ($7200.00) for himself as well as for all Quebec consumers who were charged enrollment fees in excess of $200.00 PER PLAN (not per “unit”), by any of the following Group Registered Education Plan Providers: CST, Universitas, Heritage, Children’s, Global, Knowledge First. Injunctive relief ordering Defendants to cease charging fees above the legal limit of $200 per plan is also being requested.

Status

Pending Authorization hearing

Files – Moshe Segalovich v. CST, Universitas, Heritage, Children’s, Global and Knowledge First

pdf_iconApplication to Authorize -CST- Filed July 19, 2016

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By | 2017-01-31T09:05:07+00:00 October 7th, 2016|Active Class Actions|Comments Off on Group RESP (Registered Education Savings Plan) Unlawful Enrollment Fees and Sales Charges – Quebec Consumer Class Action