A motoring watchdog has accused an Auckland towing company of "extortion" after it towed a woman's car - and then charged her $320 rather than issuing a simple fine.

Kate Bruce admits being 80 minutes late to move her vehicle but says the extra time only cost the company $2 in lost parking revenue and in her opinion the towing fee is exploitative.

The Automobile Association (AA) is now calling for towing charges to be regulated by the Government, saying penalties must be proportionate to the offence.

"This sort of extortion just needs to be exposed so businesses change their behaviour," AA spokesman Mark Stockdale told the Herald.

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But the parking company is defending the enforcement action as necessary to protect private property and free up parks.

Kiwi Parking says towing charges have been justified by the court system and are
Kiwi Parking says towing charges have been justified by the court system and are "fair and reasonable". Photo / Supplied

Bruce, a copywriter, parked in an area managed by Kiwi Parking at 15 Nugent St, Grafton about 9am on Wednesday last week.

She downloaded the Kiwi Park app and paid $5 to park until 2.13pm. But when she realised her meeting had run over time she claims she was unable extend her session as it had already expired.

When she arrived back at the car park about 3.30pm her Toyota Wish had been towed by Supercity Towing, a company associated with Kiwi Parking.

She was forced to handover $320 to get it back.

Bruce questioned why towing was necessary given that in her view the vehicle was not causing any obstruction. She now planned to take the company to the Disputes Tribunal.

"This company is absolutely exploiting the system," Bruce alleged. "It's not okay to do business this way."

Auckland Transport and other major parking enforcement companies that have signed up to a voluntary code of conduct issue breach notices to errant parkers of $40 to $60, which Bruce believed was fair.

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"It needs to be regulated."

She said in her opinion: "It's just a complete racket."

Kate Bruce says a $320 vehicle towing charge was unjustified and exploitative. Photo / Brett Phibbs
Kate Bruce says a $320 vehicle towing charge was unjustified and exploitative. Photo / Brett Phibbs

Stockdale said while the Government moved to regulate clampers last year by imposing maximum fees of $100, private towing operators could charge whatever they liked.

There was no justification to tow someone's car unless in an emergency, he said. A $320 fee was unjustifiable when the company could instead issue breach notices or use clamps.

"That sort of penalty is highly excessive and just shouldn't be used in this situation because the penalty exceeds the offence.

Stockdale said in his opinion: "It's out of proportion with the amount of revenue the parking company lost and it looks like extortion. It's completely unfair."

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Consumer NZ head of research Jessica Wilson said the organisation fielded regular complaints about towing charges.

Motorists who felt hard done by should raise the matter directly with the company before going to the Disputes Tribunal.

Kiwi Parking spokesman Dan Armstrong said Bruce had agreed to the company's condition but breached the terms.

"If she had stuck to the agreement of the original session or paid to set up a new parking session she would not have been towed and no enforcement action would have been necessary."

Kiwi Parking says motorists using its app are sent alert notifications warning their time has expired. Photo / Supplied
Kiwi Parking says motorists using its app are sent alert notifications warning their time has expired. Photo / Supplied

Armstrong said signage warning vehicles could be towed was displayed at the car park. The company would also have sent an alert to Bruce's phone warning her time was about to expire, though she disputes receiving this alert.

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He rejected AA's criticism, saying the company's towing charges "have been justified by the court system as a fair and reasonable price for the type of work".

Towing was necessary because many people did not pay breach notices and their vehicles would still take up other parking spaces, Armstrong said.

"The use of towing is for the benefit of enforcement and removing non-compliant users of the car park.

"The terms are set and people are given the choice to choose whether they accept these terms or not."

Consumer Affairs Minister Kris Faafoi said towers were regulated "to some extent" under the Land Transport Act, meaning consumers already had a level of protection.

Motorists who felt they had been unfairly charged for a vehicle towing could take action in the Disputes Tribunal or complain to the Commerce Commission or NZTA.

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