Thanks again everyone.I have reread his contract and it only stated that they will charged 2% if we pay with credit card. It has the installment plan details, like the date and amout due but nothing about late fee at all.I know that he is in the wrong for late payment, however I do think the school should send a reminder through an email or letter, especially as it is $100/week penalty, it seems that they just let it continue week by week and assuming that the student received the sms is not good enough. He goes to school 5 days a week so at least they can always let the teacher know or ask him to go to the office to see them if they really want to remind him.This is only his second term in here so I'm sure he learnt his lesson and I told him to put a reminder on his mobile phone too for when the next installment due.
In that case they dont have a leg to stand on regarding late fees. Unless he signed another form and they didnt give him a copy (have seen that done too).
I would be encouraging him to write them a letter stating that "here is the payment. In future you would appreciate any fees correspondence to be in writing as clearly the SMS system doesnt work. In regards to the late fees, there will be no payment as upon rechecking my contract there is no facility for this charge. Unless the school/uni can show where I signed stating that I agree to this charge"
or something along those lines.
If you are his legal guardian or sponsor then I would also put in there that you would like to be included in the communication.
I would also still ring ACCC / The education Ombudsman / Dept Of Fair Trading to find out my rights behind their policy. Its a nice touch to a letter when you can add - 'Dept xyz has informed me that ....'