FOS awards cannot be used as a springboard for litigation, says Adam Edwards
The Court of Appeal has overturned the High Court’s decision that the doctrine of merger does not apply to final decisions of the Final Ombudsman Service (FOS). This means that once claimants accept a FOS final determination, it is final and binding such that they cannot pursue civil proceedings for losses over and above the current £150,000 redress limit of FOS jurisdiction.
Complaint
Mr and Mrs Clark (the Clarks) originally raised a complaint through FOS against In Focus Asset Management & Tax Solutions Ltd (In Focus). It was alleged that In Focus had provided poor investment advice, which had caused the Clarks to suffer losses of over £500,000.
FOS upheld the Clarks’s complaint in January 2010. FOS awarded the maximum redress amount within its jurisdiction (£100,000 at that time, now increased to £150,000). In accordance with the statutory regime governing the FOS process, the decision was given as “final and binding” on the parties and FOS also made a recommendation that
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