Financial Services Complaints Limited (FSCL) made three unsuccessful applications to the Chief Ombudsman to use the name “Ombudsman”. The first decision of Chief Ombudsman to refuse FSCL was made on 15 July 2016, and was subsequently set aside by the Court of Appeal. In this case, the High Court was asked to review the Chief Ombudsman’s second decision to refuse FSCL made on 20 June 2019.
An Ombudsman is an independent official appointed by Parliament to investigate complaints regarding the conduct of government executives and agencies. The name ‘Ombudsman’ is protected under s 28A of the Ombudsmen Act, which holds that only those appointed by legislation or written consent of the Chief Ombudsman may use it.
FSCL was the first scheme to be established under the Financial Service Providers(Registration and Dispute Resolution) Act 2008. The scheme provides an avenue for financial service customers to seek dispute resolution against participating financial service providers. FSCL applied to the Chief Ombudsman for approval to describe itself as “FSCL – a Financial Ombudsman Service”, and its CEO as “Financial Ombudsman and CEO”.
Grice J acknowledged that the decision to refuse FSCL’s applications was reasonably available to the Chief Ombudsman in the circumstances. However, a decision to approve the application was also a viable outcome. It was thus the responsibility of the Chief Ombudsman to approach the issue with an open mind, and not a predetermined outcome.
On its face, the process appeared legitimate. The communications from the Chief Ombudsman to FSCL were all above board and nothing in the official documents suggested pre-determination. However, the Court found that all the evidence of the surrounding actions and circumstances needed to be considered in the round. Steps taken by the Ombudsman outside those official communications to FSCL suggested that the outcome was predetermined.
The High Court found predetermination could be inferred in circumstances where:
- The Chief Ombudsman was predisposed against granting use of the name “Ombudsman” to any private organisation;
- Comments made in emails to the Speaker indicated that “the Chief Ombudsman had closed is mind and was not amenable to persuasion”; and
- The Chief Ombudsman failed to take steps to obtain a savings provision for FSCL to ensure that if approval was granted, it would be effective.
Taken together, this suggested that the Chief Ombudsman never intended to accept FSCL’s application.
The decision was set aside and referred back to the Chief Ombudsman for reconsideration. Grice J suggested that the issue be reconsidered by a different person, either through a temporary appointment to the role of Chief Ombudsman, or a delegation of the decision-making powers.
Following its commencement on 11 March 2021, the Ombudsmen (Protection of Name) Amendment Act restricts the use of the name ‘Ombudsman’ to persons appointed under the 1975 Act or a public sector department. This means that private sector schemes such as FSCL will be prevented in future from applying to use the name for themselves. However, a savings provision has been provided for FSCL under the Act. This means that the scheme will be able to use the name if, upon reconsideration, consent is given by the Chief Ombudsman.
If you are interested in more about this case, or judicial review, please contact Aimee Dartnall.