The FSO's legal views on time limits for bringing complaints

Brendan Burgess

A very interesting section in their Annual Review 2016 (PDF Page 16)

Time Limits for bringing complaints to the Financial Services Ombudsman

Section 57 BX – (3) (b) of the Central Bank Act 1942, as amended, provides that “a consumer is not entitled to make a complaint to the Financial Services Ombudsman, if the conduct complained of occurred more than six years before the complaint is made”.

During 2016, the High Court came to examine that provision in some detail. Delivering Judgment in Stowe v. FSO and another [2014/109MCA] on 18 April 2016, Twomey J, noted the decision of the FSO to decline to examine an alleged representation of the Financial Service Provider, alleged to have occurred on a date outside the six year period before the complaint was made to the FSO. The Court confirmed that this did not amount to “a serious and significant error” by the FSO. In the opinion of the Court, the alleged representation was not “evidence” of the conduct complained of and/or a parol [verbal, not written] term of the mortgage agreement and consequently, it did not fall for consideration by the FSO. The Court took the view that, to consider the alleged representation to be “evidence”, would circumvent the clear wording of the 1942 Act. The Court noted that:-

“The imposition of limitation periods, such as in this case, can lead to unavoidable hardship in certain cases because by their very nature there has to be a cut-off point at some stage, e.g. a claimant might be one day on the wrong side of a cut-off date or be unaware that they have a complaint until it is too late. Despite this hardship, there are good reasons for having limitation periods, since otherwise, a dispute resolution body, whether the Courts or a body like the FSO, could be open to claims and challenges ad infinitum. Indeed, in the context of limitation periods for other claims, six years for complaints to the FSO is a relatively long period. Unfortunately, it means that consumers like the Stowes may, through no fault of their own, fall on the wrong side of the limitation period.”

The Court also noted in that instance, that a decision had been made by the consumer to complain to the FSO, rather than proceeding to litigate through the Courts. The Court indicated that a complaint to the FSO should not be viewed by a Complainant as a “free go” before then proceeding onwards to the Courts. Twomey J indicated that:-

“It is important for consumers to realise that an appeal from a Finding of the FSO is not a true second bite of the cherry, unlike say an appeal from the Circuit Court to the High Court. In a Circuit Court Appeal, there is a complete re-hearing of all the facts and the Judge can make a decision based on this re-hearing. … In contrast, it could not be said that an Appeal of the decision of the FSO to the High Court has the exact same chance of success as the initial case before the FSO and consumers need to be aware of this fact before undertaking the expense of a High Court Appeal of the decision of the FSO.”

Consideration is currently being given by both the Government and the Oireachtas to amending legislation that would extend the six year limitation that applies for bringing complaints to this office.
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Brendan Burgess

I attended the hearing of this case and the Judge's decision. I have not read the written report which is here:

I have to say, I found the Judge's reasoning bizarre.

The counsel for Stowe was excellent, and I did not think that the FSO's team made any sort of a valid defence.

The legislation is clear:

It's about the "the conduct complained of occurred more than six years before the complaint is made"

It says nothing about evidence from over 6 years ago.

I will study the case in detail.