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Court overturns ruling that case fees are unfair

The Court of Appeal has rejected a county court judgment that it is unfair for advisers to pay a Financial Ombudsman Service case fee where a complaint is not upheld.

Following a hearing in April, the Court of Appeal said last week that it had upheld the FOS’s appeal against the Pickering decision.

In the ruling in February, Judge Rutherford of Trowbridge county court found the FOS’s practice of charging firms for dealing with rejected complaints to be “unfair in principle and in practice”.

An FOS spokesman says: “The FOS is pleased that the Court of Appeal has provided clarification on this issue.”

The FOS brought the case against Heather Moor & Edgecomb directors Brian and Dolly Pickering after they refused to pay four case fees of £360 each for cases that were not upheld.

Dolly Pickering says: “We are devastated by this verdict and will decide whether to appeal this week.”

The FOS, which can claim its legal fees from HME,could drop the costs if the Pickerings decide not to appeal. HME also lost a Court of Appeal case last week where it contended that the FOS should follow common law in resolving complaints. The judge ruled this is not the case under the Financial Services and Markets Act.

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