Application of 6 year limit for complaints to Financial Ombudsman

In Mortgage Agency Service Number Five Ltd, R (On the Application Of) v Financial Ombudsman Service Ltd [2022] the High Court considered a challenge to the application of the 6 year limit on a complaint to the Financial Ombudsman.

The Ombudsman was dealing with a complaint about unreasonably high interest rates over a period of around 10 years (2008 to October 2018). While she was limited to a time limit of six years which restricted her to interest rates charged since October 2012, the Ombudsman decided that events before this date were relevant to the interest rates charged during the six year period and that she would look at those too –

In my view, MAS5’s decisions to vary the interest rate in what it considered to be the exercise of its contractual powers during the period 2008 onwards have now become the subject of Mrs D’s complaint. Those decisions are relevant to what Mrs D has complained about and which has occurred within the last six years – each of the monthly charges. In considering the fairness of each of the monthly charges from 31 October 2012 onwards, we need to consider all relevant matters contributing to those events. That means we will need to consider the whole history of the interest rate, including before 31 October 2012. That is because the interest variation decisions taken by MAS5 from 2008 to 2012 are important context for the later monthly charges. MAS5 may have determined, in part, the rate that was charged during the period we can consider.

If, to take an example, there was no contractual power to increase the interest rate by 0.75% in November 2011, that could potentially affect whether a monthly charge made in 2015 was fair and reasonable.

The mortgage company challenged this course of action by judicial review but the High Court dismissed the JR

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