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Court of Appeal rules FOS fees are not unfair

The Court of Appeal has rejected a recent County Court judgement which declared it unfair for advisers to pay a Financial Ombudsman Service case fee if they were found innocent.

The judgement, released today, follows a Court of Appeal hearing in April and upholds the FOS’s appeal against the original County Court decision made in February.

A FOS spokesman says: “The FOS is pleased that the Court of Appeal has provided clarification on this issue. It affected everyone which is why it was important this clarification was given.”

The FOS appealed the ruling as it was worried it could have significant implications for the way the organisation is funded.

In the original ruling, Judge Rutherford of Trowbridge County Court found the FOS’s practice of charging firms for the cost of dealing with complaints that are rejected to be “unfair in principle and in practice”.

Judge Rutherford ruled that “no reasonable public body would maintain and enforce such a rule”.

The ombudsman service brought the case against IFAs Brian and Dolly Pickering after they refused to pay four case fees of £360 each.

The Pickerings have not yet decided whether to appeal the ruling.

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