Jersey: Onward For The Ombudsman

The Royal Court has recently handed down its judgment in the first judicial review of a decision of the Channel Islands Financial Ombudsman ("CIFO") Future Finance Limited v Channel Islands Financial Ombudsman [2019] JRC041.

Factual background

CIFO was set up in 2015. The primary role of CIFO is to resolve complaints about financial services provided in/or from the Channel Islands. When CIFO receives a complaint about a Financial Services Provider ("FSP"), it will conduct an investigation, will try to facilitate a settlement of the dispute and, if that fails, will make a determination. If the determination is accepted by the consumer it becomes binding on the FSP. CIFO is not a court or a regulator and therefore does not fine or discipline FSPs, but it can make awards requiring the FSP to pay money to the complainant, and the awards can be enforced in court as a civil debt up to £150,000.

Future Finance Limited ("Future Finance") was subject to a determination by CIFO in relation to a private mortgage which was arranged for a Jersey couple (“the Complainants”) by Future Finance Ltd. The Complainants had approached Future Finance to find the best deal available for a mortgage. Future Finance agreed to do so but advised the Complainants that they would not be able to obtain a conventional mortgage and that the best option available was a private mortgage. Consequently, the Complainants entered into a private mortgage proposed by Future Finance. Shortly after the purchase the Complainants found themselves in financial difficulty.

The Complainants complained that the private loan was not suitable for their needs at the time. The complaint was subsequently referred to CIFO, who determined that, contrary to their assurances, Future Finance had not made reasonable efforts to find the best mortgage for the Complainants. CIFO ordered Future Finance to pay compensation to the Complainants. Future Finance applied for a judicial review of CIFO's decision.

Judicial Review: Grounds

Future Finance sought a judicial review on the grounds that CIFO acted ultra vires, illegally or irrationally by

  1. making factual errors;
  2. assuming that it had jurisdiction over Future Finance in respect of mortgage broking business;
  3. failing to take into account relevant considerations; and
  4. taking into account irrelevant considerations.

Judgment

Under ground (2), the Court held that Future Finance was a "relevant ancillary business" as defined under Article 9 of the Financial Services Ombudsman (Jersey) Law 2014 ("the 2014 Law") and was not exempt under Article 6 of the 2014 Law. Therefore, CIFO had jurisdiction over Future Finance’s mortgage broking business.

The Court dismissed Future Finance's submissions under grounds (1), (3) and (4). The Court held that "the complainants had a legitimate expectation in all the circumstances that Future Finance Limited would make reasonable efforts to find a conventional mortgage before putting forward a more expensive private lender" and "it was reasonable of the Ombudsman to conclude that the expectation had not been met in this case" [at paragraph 68].

Anonymity

CIFO applied to preserve the anonymity of the Complainants on the grounds that it is the policy of the Ombudsman, as with other such Ombudsman schemes, to maintain confidentiality over the identity of a complainant. Complainants are informed of this at the outset of the CIFO process and the Ombudsman undertakes to maintain confidentiality, subject to legal obligations, preserving such confidentiality as far as possible so as to encourage complainants to use the Ombudsman process. In a small community like Jersey there is all the more need to avoid revealing personal information about people's personal financial affairs [paragraph 75].

The Court accepted that the Complainants’ identities were irrelevant to the proceedings [paragraph 80]. The Court anonymised the judgment to avoid reference to the Complainants’ identities and ordered that publicly available documents held by the court shall not identify them. However, the Court did not think it proportionate on the facts of this case to impose wide ranging reporting restrictions on the press which were not time barred.

Conclusion

This case is the first of its kind in the Channel Islands. CIFO will doubtless be satisfied that it has successfully defended the first major challenge to its authority.

www.bakerandpartners.com

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Topics
 
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions