High Court Clarifies The Standard Of Review Of Financial Service Ombudsman Procedure In Dealing With Complaints

The High Court (the "Court") has reiterated that an appeal against a decision of the Financial Services Ombudsman (the "FSO") is not a new hearing of a complaint but rather involves a review of the FSO's decision making procedure. In the recent case of John Caffrey v the Financial Services Ombudsman (Hedigan J., 12 July 2011) (the "Caffrey Case"), the Court followed an established line of case-law holding that the decision of the FSO will only be overruled in the case of a serious and significant error relating to the procedure adopted. Once the FSO's procedure is reasonable, the Court will not intervene to examine the merits of the decision.

The office of the FSO was established under the Central Bank and Financial Services Authority of Ireland Act 2004 which amended the Central Bank Act 1942. Section 57CL of the Act provides either party with a right of appeal to the High Court against a finding of the FSO within 21 days of the finding or such further period as the High Court may allow. An appeal taken under this procedure is separate from Judicial Review proceedings. As set out in Section 57CM of the Act, the High Court has a broad discretion in terms of the orders it can make in such an appeal including, inter alia, affirming the finding of the FSO with or without modification, setting aside the finding of the FSO or remitting the finding to the FSO for further review.

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