Also known as: service charges · service-charge · service fee
Written by attorneys · grounded in primary & secondary sources — see below
3 senses
A fee charged by a financial institution for maintaining or servicing an account. Lawyers may deposit their own funds into a client trust account solely to cover these fees and only in the amount necessary for that purpose.
A fee charged by a financial institution for maintaining or servicing an account. Lawyers may deposit their own funds into a client trust account solely to cover these fees and only in the amount necessary for that purpose.
Select any source to read its text and confirm it supports the definition.
The finance or interest component assessed on a credit obligation. When consumer goods serve as collateral and a secured party fails to comply with disposition rules, a debtor or secondary obligor may recover at least this charge plus ten percent of the principal or cash price as a statutory minimum.
Select any source to read its text and confirm it supports the definition.
A user fee charged by a property-owners association for services or facilities. Unless the declaration provides otherwise, the amount must be reasonably related to the association's costs and may not force some members to subsidize benefits to others.
Select any source to read its text and confirm it supports the definition.
The finance or interest component assessed on a credit obligation. When consumer goods serve as collateral and a secured party fails to comply with disposition rules, a debtor or secondary obligor may recover at least this charge plus ten percent of the principal or cash price as a statutory minimum.
A user fee charged by a property-owners association for services or facilities. Unless the declaration provides otherwise, the amount must be reasonably related to the association's costs and may not force some members to subsidize benefits to others.
Each sense below has its own examples, sources, and questions.
Samuel Soto maintains a client trust account that incurs monthly bank fees for wires and statements. He deposits a modest personal sum calculated to match only the expected charges for the coming month. The bank deducts the actual fees from that deposit and Soto withdraws nothing more.
Stella Shapiro deposits client funds into an IOLTA account that generates interest net of bank service charges. The bank remits the net interest to a legal foundation for charitable purposes. Shapiro confirms the service charges never reduce the principal client balances.
Sierra Santos, a bank shareholder, challenges corporate spending on ballot measures funded partly through service charge revenues. The corporation claims the expenditures advance its business interests. Santos argues the use of those revenues infringes shareholder rights.
The deposit must be limited to the amount necessary for that purpose. A fixed large buffer that greatly exceeds documented monthly charges violates the rule even if no client funds are lost.
Supporting sources
Sylvia Santos financed a used minivan for family use through a secured lender that later repossessed and sold the vehicle without proper notice. The court finds the disposition violated Article 9 rules for consumer goods. Santos recovers the credit service charge plus ten percent of the principal amount without proving actual loss.
Solomon Silver's airline enters a long-term fuel supply agreement that includes variable into-plane service charges. Monthly liftings fluctuate with weather and schedules, affecting the total service charges billed. The parties dispute whether those charges fall within the contract's price-escalation clause.
The debtor recovers at least the credit service charge plus ten percent of the principal amount or cash price. This floor applies regardless of actual loss or the existence of a deficiency.
Supporting sources
Selena Singh, a public school teacher, objects to paying a service charge equal to union dues. The charge funds collective bargaining and also political activities unrelated to representation. Singh sues claiming the mandatory payment violates her First Amendment rights.
No. Unless the declaration authorizes broader revenue raising, such fees must reasonably relate to the cost or value of the specific service provided.
Supporting sources
…members of the Union were nevertheless required to pay the Union a service charge equal to the regular dues. The Union used the service charges for purposes of collective bargaining, contract administration, and other union services, but also for political and ideological activities unrelated to collective bargaining. Appellants,…