In a groundbreaking decision, the English High Court confirmed that KPMG, a private body, was subject to judicial review when performing a public function, in the context of a UK Financial Services Authority review. As decisions of the English courts are of persuasive authority in Ireland, this case has significant implications for private bodies carrying out public law functions, especially those bodies that are appointed by the Central Bank of Ireland to act as "skilled persons".
Background
In 2012, the UK's Financial Services Authority identified serious failings in the sale of certain interest rate hedging products by banks to particular categories of customers. In response, a number of banks agreed to individually review each such sale and provide redress to customers where appropriate. The FSA invoked its statutory power to require that the redress process be overseen on its behalf by an independent reviewer with the necessary skills to confirm the appropriateness, fairness and reasonableness of the offers of compensation. Such appointees are commonly known as "skilled persons".
One customer, Holmcroft Properties Limited was dissatisfied with the level of compensation offered to it and sought leave to judicially review KPMG, the skilled person overseeing its past business review.
Following an application for leave in April 2015, the English High Court granted Holmcroft permission to apply for judicial review of KPMG, notwithstanding that KPMG is a private body. The Court held that as it was a matter of considerable public interest and as an arguable case had been made out, the redress scheme overseen by KPMG had a sufficient public law dimension to deem KPMG subject to judicial review. The substantive judicial review case is yet to be heard.
The underlying message from this leave application is that private bodies must be cognisant when agreeing to carry out functions of a public nature that they could ultimately be subject to judicial review.
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