Request to refund Agent fees

Friday, November 29, 2019

Issue/Summary of Complaint

1. The Student, [redacted], was accepted into the New Zealand Graduate Diploma in [redacted] (the “Program”) with [redacted], the Provider.

2. The Student was issued with an invoice for the payment of fees dated 21 May 2019. On the Provider invoice the Agent is stated as [redacted] (“Agent”).

3. The Student paid the full amount of the Provider invoice on 17 June 2019. On the Provider sales receipt the Agent is stated as [redacted].

4. The Student’s fees are currently being held with the Public Trust.

5. The Student sent a notification of his intention to withdraw from the programme on Thursday 18 July 2019.

6. The Student informed the Provider of his personal circumstances as the basis for why he needed to withdraw from the Program. Some of the reasons outlined in the withdrawal letter highlighted the financial hardship being experienced by the Student and his family.

7. The Student requested in his letter of withdrawal that the fee to be deducted for the early withdrawal from the Program be minimised.

8. The Provider acknowledged receipt of the withdrawal application from the Student and advised the Student that they would contact the Agent ([redacted]) then advise the amount of refund that would be paid to the Student. In the letter from the Provider there was a suggestion to the Student that they also contact (the Agent).

9. The Student confirmed to the Provider that he had informed his Agent.

10. The Provider reiterated that a fee was payable to [redacted] as they provided services to the Student in their role as his Agent.

11. There was an exchange of emails between the Student and the Provider relating to the payment of the fee along with the Provider’s responsibility as set out in The Education (Pastoral Care of International Students) Code of Practice 2016.

12. The Student raised a complaint with the New Zealand Qualifications Authority (NZQA) and was referred to iStudent Complaints on the basis that there was a financial dispute between the Provider and the Student.

13. The Provider was notified of the Student’s complaint on 8 August 2019.

14. The Student and the Provider met in mediation on 8 October 2019 in an attempt to reach agreement. The Provider and the Student were unable to reach agreement and the matter has now been referred to adjudication.


Background

15. The Student made enquiries about applying for the Program initially via WeChat conversation through (the Agent).

16. The Student was in WeChat communication with (the Agent) from March 2019 through until June 2019. During this period (the Agent) provided answers to the Student’s queries and assisted with providing information as part of the enrolment process for the Program.

17. The Student completed an online application form for the Program dated 22 April 2019. On the form the Student has ticked the box indicating that he has an Educational Partner (Agent) and has named the Agent as [redacted].

18. The Student undertook an interview on 9 May 2019. He was advised that he “passed the interview and an unconditional offer will be issued within the week.”

19. The Student signed an Offer of Place for International Student (“Offer”) with the Provider for the (Program) dated 23 May 2019. The Agent named on the form is [redacted].

20. The Student signed page 7 of the Offer which is titled ‘Withdrawals and Refunds’. A link on the page provides details of the Withdrawal and Refund policy.

21. The Student applied to Immigration New Zealand direct and was issued with an Approval in Principle (AIP) letter dated 5 June 2019.

22. The Student paid his full fees as indicated by the Sales receipt dated 17 June 2019 which amounted to NZ$30,444. This consisted of tuition fees ($29,500.00), Student fee insurance ($66.70), Student card fee ($10.30), Police vetting fee ($25.00) and Medical insurance (16 months) ($842.00).

23. The Student was issued with a New Zealand Student Visa Approval from Immigration New Zealand dated 18 June 2019.

24. The Student booked a flight to arrive into Auckland on September 14 2019.

25. The Student’s submission is that the advice given to him about when he should arrive into New Zealand was not clear and left him with insufficient time to be ready to start the Program. The Student cancelled his flight resulting in a financial loss.

26. The Student submitted a letter to the Provider advising that he would be withdrawing from the Program dated 18 July 2019.

27. The Provider acknowledged receipt of the Student’s letter and advised him they would need to contact (the Agent) before a decision could be made about the amount of refund as follows: “Let me contact your agent [redacted], then get back to you regarding how much refund you can get after you withdraw from our [redacted] program. I suggest you inform [redacted] of your current situation as well. I’ll be in touch once I hear back from them.”

28. The Student replied to the Provider on 22 July 2019 confirming that he had informed his
Agent as follows:
“I informed my agent of my request last Thursday. They are aware of it. Could you please
let me know how I should complete my request and the process of refund as well as the
amount of fees that I can be refunded?”

29. The Provider informed the Student on 23 July 2019 that they had contacted his agent and that a discussion was being held with the company director and her team and a that decision was being made “pretty soon”.

30. The Provider advised the Student on 24 July 2019 that [redacted] would deduct the amount of $4,925 and “refund all other fees to you”. The Student was informed that the fees were being held in the Public Trust account.

31. There were several emails exchanged between the Student and the Provider on 25 July 2019.

32. The Student responded to the email dated 24 July 2019 on 25 July 2019 as follows,
“Thank you for your timely reply. I really appreciate it! Two months before the enrolment date, I decide to withdrawal myself from your program, with sadness and sorrow, because of
harsher conditions: family, floods, and everything. I have explained them in my previous
mail. I genuinely hope that you could recalculate and reduce the deduction amount. Regarding to my present circumstance and two months before the enrolment, a deduction of
$4,925 is such a large number. I sincerely hope that you can take my factors into consideration and show more compassion!”

33. The Provider responded on the same day and reminded the Student that they could deduct “up to 25% of the full fee” in line with “NZ government” and [redacted] policy.

34. The Provider included in their response the links to the “Student withdrawals and refunds” (International Students from the New Zealand Qualifications Authority website) as well as a link to (the Provider’s) Student Withdrawal and Refund Policy for International Students. The reply included an explanation of the reason for the deduction as follows:
Our General Manager considered your situation and decided to deduct the minimum amount of your fees. (Provider) only charge $500 administration fees, and we have to pay $4425 service fees to (Agent) as the college had an agreement with this company which bind by the New Zealand government policy. This company helped you with program and visa applications. NZ government requires education provider to protect agent by paying service fees. That’s why $4925 is the minimum amount that we will deduct.”

35. The Student responded with a request to the Provider that they only deduct $500 for administration fees and that he would negotiate his own fee with (the Agent) as follows: “So, if I discussed with [redacted] Agent and come up with a new agreement with them, could you only deduct from me the $500 administration fees and the new fees I negotiate with Agent [redacted]?”

36. In response to the Student’s request about negotiating his own fee with [redacted], the Provider advised “As of the agreement which we signed with (the Agent), we need to
pay 15% of tuition fees to the company. This agreement is monitored and supervised by
NZQA… Their whole team discussed your case then the Manager already requested their
Accounts staff send an invoice to claim $4425 service fees from our college.”

37. The Provider requested that the Student “Please fill in our withdrawal form, so we can move on to next step.”

38. The Student did not agree with the fee being paid to (Agent) “I find the service fee of [redacted] Agent unreasonable…I doubt the service fees and hope you can delete this part. Otherwise I will report the issue to NZQA and request them to make a judgement concerning the service fees.”

39. The Provider included in its response a link to the “government policy of international student refund requirement”. A request was made to the Student to “Please fill in attached (Provider) withdrawal form, so we can continue to process your case.”

40. The Student advised the Provider on the 29 July 2019 that he had contacted (Agent)
concerning the service fee of $4425. He included a reply from (Agent) and advised the Provider “I have never signed any contract with (agent), letting alone that they don’t charge this fee. So the decision of deducting $4425 service fee, from my tuition is unreasonable and should be corrected.”

41. The Provider provided a response on the 30 July 2019 reminding the Student “our college signed an agency agreement with [redacted]. For any student who successfully received a student visa from Immigration NZ, our college needs to pay commission to the agent. This is protected by NZ government, including NZQA and the Ministry of Education.”

42. In the response above The Provider offered a possible solution to the Student “Maybe you come to study our program once your family situations gets better. So you don’t lose any
money. NZ Public Trust will keep your money until you come to NZ and start our [redacted]
program.”

43. The Student sent a response on 30 July 2019 emphasising that he had “never signed any agreement or contract with any agent party” and advised the Provider that he had “completed the visa application all by myself”. It was the Student’s view that the contract between the Provider and (Agent) “does not apply to my case, and the deduction of service fee of $4425 from my tuition to pay the agent is not just and should be eliminated.”

44. The Provider confirmed to the Student on 30 July 2019 “We received your application through (Agent) in April, they verified all your application documents. NZ government does not require an education provider to contact the agent company to get proof that a student signed an agreement with his/her agent.”

45. The Provider outlined the requirement by Immigration New Zealand and the reason why “Our Registry Team issued the offer letter and invoice with [redacted] name in. You signed and accepted our offer of place. Then you paid fees to the Public Trust, and our Accounts Team issued the receipt with [redacted] name in. This receipt is required by Immigration NZ to issue a student visa.” The Provider requested that the Student “please check all those documents and tell us why you signed back our offer with Agent name shown as [redacted].”

46. The Student provided a response on 5 August 2019. He provided an explanation of why he signed back the offer with the Agent name by advising “based on faith that I held in your college, New Zealand Education and the Public Trust system of New Zealand to which my money was transferred.”

47. The Student shared that he had never been informed “in any way by (Agent) that my information was used by them for their business purpose and that the name on the documents means that the (Agent) would receive commission or service fees from my case. I was mislead and deceived…”

48. The Student has referred to The Education (Pastoral Care of International Students) Code of Practice and has asserted “your college is obliged to manage and monitor your agents including the [redacted] in this case. If your agent, in this case [redacted]  is found to have been or is involved in misconduct and wrongdoings that are against the rules and regulations, your college is obliged to take appropriate action to address conduct or an omission by an agent, or terminate contracts with an agent.”

49. The Student requested that the Provider “take immediate actions to help investigate into the complaints made” in his email.

50. The Provider responded to the Student’s email of 5 August 2019 by advising of the
partnership they have had with [redacted] since 2005 and they have “never find this company has any misconduct or dishonest behaviour. Or we should cancel their agreement for long time.”

51. The Student sent a further response on 5 August 2019 addressing some of the matters raised in the Provider’s previous email. The Student confirmed “I will not go to study”. Additionally, the Student reiterates that the Provider “is obliged to monitor and manage your agent, take appropriate actions in case of misconducts.” The Student requests that the Providerinvestigate in the claims immediately!”

52. The Provider responds to the email of 5 August by stating “Our college has followed NZQA’s Education (Pastoral Care of International Students) Code of Practice 2016 (Amendments 2019) to manage our agents and education partners… I don’t know what to investigate.”

53. The Student’s complaint was acknowledged by iStudent Complaints on 8 August 2019 and the Provider was advised of this on the same date.

54. The Student and the Provider met in mediation on 8 October 2019 in an attempt to reach agreement. The matter was referred to adjudication on 9 October 2019 and the Student and the Provider have now had the opportunity to make their submissions.


Student’s Position

55. The Student’s submissions to the International Contract Dispute Resolution Scheme are dated 17 October 2019.

56. The Student has responded to the Provider’s position that he is not entitled to a 100% refund of fees as follows:

56.1 The Student admits that “the woman/(Agent) is involved in my application to (Provider)”.
56.2 The Student acknowledges that he “did sign the offer of place from (Provider)”.
56.3 The Student “would like to point out these do not mean that (Provider) could deduct 19% of my tuition”.

 

57. The Student refers to the Education (Pastoral Care of International Students) Code of Practice “(Provider) is obliged to manage and monitor their agents, including the [redacted] in this case. If [redacted] is found to have been or is involved in misconduct and wrongdoings that are against the rules and regulations, (Provider) is obliged to take actions to address the misconducts or terminate contracts with an agent when necessary”.

58. The Student states that “instead of putting students’ interest in the first place and helping students to verify facts, (Provider) has chosen the totally opposite path, neglecting student’s requests and kept supporting their Agent [redacted] when they were clearly aware of the misconducts”.

59. The Student states “After I repeatedly reported the misconducts and violations by their Agent, (Provider) has never taken any actions to investigate. I pleaded them to investigate again and again, I did not ask them to give an answer immediately but at least try to investigate but I was turned down!”.

60. The Student submits that “First, (Provider) kept misleading me after my withdrawal. At first they kept using the term “service fee”, which is on the legal page they sent me. It was a sly attempt to justify their deduction of my tuition. However, as I inquired further and further, they gradually revealed that the money was actually “commission” which is not on the legal page they sent me.”

61. The Student’s position is therefore that he is entitled to a full refund and rejects the Provider’s response that he will not be granted a full refund as a service fee is payable to the Student’s Agent, [redacted] Limited.

62. In his submission, The Student outlines the reasons he received from the Provider about the payment of the “service fee” to (Agent):

“(Provider) claimed they had to deduct my money to pay service fees to (Agent) because:
(Agent) has had meetings and decided to send invoice to (PROVIDER) to claim service fees.
New Zealand labour force is very expensive, and the (Agent) employees are very experienced, they are more highly paid, so we have to pay them service fees.
“Only licensed immigration advisor could accept students’ applications, they are highly paid”.


63. The Student has also provided examples of the replies he received from the Provider
explaining their views of (Agent):
“(Agent) has been working with (Provider) from year 1996, they are the most professional in New Zealand, they are highly recognised by New Zealand government, we have not found any misconducts by them, they send us dozens of students every year.”
“(Agent) is one of the top agents and I don’t think they would do anything wrong.”
“We don’t know what to investigate, where to investigate.”


64. As such, the Student requests a full refund of the fees he has paid to the Provider, a written promise that his materials (provided to support his application) will not be leaked and used for any purpose, as well as an apology.


Provider’s Position

65. The Providers position is detailed in their submissions dated 16 October and 30 October 2019 as summarised below.
66. The Provider is entitled to retain 25% of the fee total:

66.1 “(Student)’s application for a refund fell within the refund period stipulated by the Education Act (1989) Clause 235A.4 which states: “In this section, refund period means the period that begins when the student’s fees are paid to the private training establishment (or paid directly to the independent trustee) and ends on the date specified in the notice made under section 235B.”
66.2 “As stipulated by the Education (Refund Requirements for International Students) Notice 2012, “If an international student withdraws from a programme or training scheme of 3 months’ duration or more within the refund period, the maximum percentage of the payment, or payments, that the private training establishment may retain is 25% of the fee total.”
66.3 “The (Provider) Withdrawal and Refund Policy states that “a student may withdraw before the start of her/his first course” and that when this happens that “a student is eligible for a full refund of the invoiced feeds paid, less 25% or any portion thereof determined by the College based upon specific costs incurred”.

67. The Provider has met the statutory refund requirements:

67.1 “(Student) confirmed that he had read, understood and agreed to the Payment of Terms of (Provider) when completing his application to study with (Provider) dated 22 April 2019. The payment terms of (Provider) were available to (Student) while completing the application. As stated in the Payment Terms, international students withdrawing from their studies prior to the first course starting are eligible for a total refund of fees minus a maximum of up to 25% of the fees received.”
67.2 “(Student) again accepted the (Provider) terms and conditions when accepting his offer of place dated 23 May 2019. Included in the terms and conditions of his offer was the (Provider) Student Withdrawal and Refund Policy, including a direct link to the policy details.”

68. The Provider is entitled to pay to [redacted] a fee for services rendered in relation to (Student)’s application to study with (Provider):

68.1 “(Student) appointed [redacted] as his Agent when completing his
application to study with (Provider) dated 22 April 2019.”
68.2 The Provider communicated directly with (Agent) on matters pertaining to (Student)’s application:
• 29 April 2019 – (Provider) received documentation from (Agent) via email: Verified
passport, Personal Statement, Professional Referee Report, Verified/Notarised
copy of graduation certificate and transcripts (certified by (Agent)), Verified English Language Proficiency Test results (certified by (Agent)).
• 5 May 2019 – (Provider) received documentation from (Agent) via email: Photo, Statement of Intent, NZQA International Qualification Assessment (certified by (Agent).
• 6 May 2019 – (Provider) organised the scheduling of (Student)’s interview through (Agent).
• 14 May 2019 – (Provider) received Secondary form of ID (certified by (Agent)) from (Agent) via email.
• 22 May 2019 – (Provider) sent (Student)’s offer of place to (Agent) via email.
• 24 May 2019 – (Provider) received the signed offer of place from (Agent) via email.
• 24 May 2019 – (Agent) informed (Provider) via email that they would submit (Student)’s visa application.
• 7 June 2019 – (Provider) received the Approval in Principle (AIP) for (Student) from
Immigration New Zealand via email. The AIP was forwarded to (Agent) via email.
• 17 June 2019 – (Provider) sent receipt of payment of fees to (Student) and (Agent) via email.
• 24 June 2019 – (Provider) received Student Visa (certified by (Agent)) from (Agent) via email.
• 24 June 2019 – (Agent) informed (Provider) of (Student)’s date of arrival in New Zealand.

69. The Provider is entitled to retain a fee for services they provided to the Student:

69.1 “(Provider) completed a range of services related to (Student) including marketing, admissions and enrolment. Prior to (Student)’s application, an (Provider) representative visited (Agent) Branch Office in Shanghai in March 2019 to promote (Provider)’s programs which included discussion of potential enrolment from (Student).”
69.2 “Upon receipt of (Student)’s application on 22 April 2019, (Provider) completed the full admissions process which includes:
Transferring of the application from the online application portal to the student management system.
Requesting, receiving and verification/confirmation of required documentation.
Selection interview with an academic staff member.
Completion of selection including a review by the Selection Committee.
Issuing of offer of place and invoice.
Ongoing communication with [redacted].
AIP and visa review and confirmation.
Preparation for orientation.”

70. The Provider further submits:

70.1 (Student) confirmed that [redacted] was involved with his application to study with (PROVIDER).
70.2 (Student) confirmed that he did sign the offer of place made by (Provider), in which he accepted the terms and conditions stipulated in the offer of place.
70.3 (Student) did not raise any concerns about the conduct of (Agent) during the enrolment process. In relation to allegations that (Provider) breached The Education (Pastoral Care of International Students) Code of Practice 2016 regarding the monitoring of its agents, (Provider) direct (Student) to lodge his concerns with New Zealand Qualifications Authority.
70.4 (Provider) investigated the support provided to (Student) by (Agent) and concluded that they carried out their duties to “a successful conclusion for (Student), and as per the normal responsibilities of an agent.”

71. On this basis the Provider’s position is as follows:

71.1 They reject the Student’s assertion that [redacted] did not act as their Agent.
71.2 (Provider) have stated “from the correspondence and interaction regarding (Student)’s application and enrolment, (Provider) had no reason to believe [redacted] did not represent (Student)”.
71.3 As such, (Provider) will pay to [redacted] a portion of the fee total for services rendered in preparing the application and enrolment onto the Program for (Student).
71.4 The Provider maintains that (Student) consented to abide by the (Provider) Withdrawal and Refund policy “(Provider) provided (Student) with the (Provider) Withdrawal and Refund Policy during both the initial online application process and as a link in the offer of place. (Student) accepted the policy twice when submitting his application, and again when signing his offer of place.”
71.5 The Provider seeks to retain 25% of (Student)’s fees based on “specific costs incurred by (Provider), including the commission fees payable to the [redacted]”.
 

Discussion

72. The questions which the International Student Contract Dispute Resolution Scheme must determine:

72.1 The role of (Agent) as the Agent in this dispute
72.2 The refund of paid tuition fees less the deducted amount of 25%.


73. Section 9 of the International Student Contract Dispute Resolution Scheme Rules 2016 states that an adjudicator is required to act in accordance with “what is fair and reasonable in all the circumstances, have regard to the law, the relevant good practice, the code, and other Government policies.” Further, “The adjudicator is not bound by either the rules of evidence or previous decisions and is required to determine the dispute according to the substantial merits and justice of the case, and in doing so is not bound to give effect to strict
legal obligations or to legal forms or technicalities.”
74. To determine the role of [redacted] as the Agent in this dispute, consideration must be given to the facts and information provided by the Student and the Provider.
75. The Student provided submissions for consideration on 17 October 2019, the Student has written as stated at [56.1] “To begin with, I admit that the woman/(Agent) is involved in my application to (Provider).”
76. The Student was issued with an invoice for the payment of fees dated 21 May 2019 referred to at [2]. On the Provider invoice the Agent is named as [redacted].
77. The Student paid the full amount of the Provider invoice on 17 June 2019. On the Provider sales receipt referred to at [3] the Agent is named as [redacted].
78. When advised by the Provider to inform his Agent of his intention to withdraw from the Program, the Student has confirmed as referred to at [9] that he has informed his Agent.
79. To determine the refund of paid tuition fees less the deducted amount of 25%, consideration must be given to the relevant statutory and contractual obligations on the Provider relating to refunds.
80. The Student paid his full fees on the 17 June 2019 referred to at [3] this invoked Clause 235A.4 of the Education Act (1989), “refund period means the period that begins when the student’s fees are paid to the training establishment (or paid directly to the independent trustee) and ends on the date specified in the notice made under section 235B.”
81. The Provider states at [66.2] that “If an international student withdraws from a programme or training scheme of 3 months’ duration or more within the refund period, the maximum percentage of the payment, or payments, that the private training establishment may retain is 25% of the fee total.” This is set out in the New Zealand Government Education (Refund Requirements for International Students) Notice 2012 (the “Notice”).
82. The Provider’s refund policy states that “a student may withdraw before the start of her/his first course” and that when this happens that “a student is eligible for a full refund of the invoiced feed paid, less 25% or any portion thereof determined by the College based upon specific costs incurred”.
83. The Student has confirmed that he “did sign the offer of place from (Provider)” referred to at [19]. The Student also signed page 7 of the offer of place titled Withdrawals and Refunds referred to at [20].
84. From the submissions, the Provider has asserted “Under the Education Act (1989) (Provider) is entitled to withhold 25% of (Student)’s fees based on specific costs incurred by (PROVIDER), including the commission fees payable to the [redacted] and its attendant notices.” This is also in line with (Provider)’s refund policy referred to at [66.3].
85. The jurisdiction of the International Student Contract Dispute Scheme is limited to financial or contractual matters as determined by the Education Act 1989.
86. In this regard the writer’s findings are as follows:

86.1 The Student did engage the services of (Agent) International limited as evidenced throughout the submissions. The Student admitted through his submissions of 17 October 2019 that (Agent) was involved with his application to (Provider).
86.2 While the Student does not agree, as stated in his submissions dated 17 October 2019 that “(Provider) could deduct 19% of my tuition.” The provisions set out in the Education Act (1989) along with the Notice support the decision by (Provider) to withhold 25% of the fee total. This is further supported by the Provider’s withdrawal and refund policy referred to at [66.3].
86.3 The Student through his submissions has referred to The Education (Pastoral Care of International Students) Code of Practice with particular regard to the (Provider)’s obligations to “manage and monitor their agents”.
86.4 The Provider has submitted that “(Provider) investigated the support provided to (Student) by (Agent) and concluded that they carried out their duties to a successful conclusion for (Student), and as per the normal responsibilities of an agent.”
86.5 After reviewing the submissions, the writer could not find examples of a breach of The Education (Pastoral Care of International Students) Code of Practice in relation to the service provided by (Agent) to the Student through the application process.
86.6 In the submissions, the Student referred to additional regulations. The writer has
determined that this goes beyond the scope of what was required to address the matters pertaining to this adjudication.


Proposed Decision

87. The proposed decision of the International Student Contract Dispute Scheme is that the
Student’s complaint be dismissed.
88. Both parties now have a final opportunity to provide further submissions before a final
decision from the International Student Contract Dispute Scheme is issued.


Final Decision

1. The parties were invited to provide any final comments on the proposed decision issued 14 November 2019.
2. No further comments have been received from the Student.
3. No further comments have been received from the Provider.
4. The proposed decision of the International Student Contract Dispute Resolution Scheme is confirmed, and the Student’s complaint is dismissed.

 

Adjudicator
Christina Tay
29 November 2019