The Financial Services Ombudsman is a statutory officer who deals independently with unresolved complaints from consumers about their individual dealings with all financial services including banks and credit unions. It is a free service to the complainant and once somebody has made a formal complaint to their bank for instance, they can submit a complaint on line to the Financial Services Ombudsman.
However, where proceedings have commenced against an individual for instance by a bank for outstanding liabilities, making a complaint to the Financial Services Ombudsman does not necessarily terminate or stall those proceedings.
There was an interesting judgment delivered on the 16thMarch, 2017 whereby Start Mortgages Limited was suing an individual in Cork in relation to a loan offer and agreement dated the 7thJune, 2006. This was in respect of a term loan in the sum of €770,000 for a period of 30 years at an interest rate of 2.6%. The loan was advanced to the defendant on or about the 9thOctober, 2006 but he subsequently defaulted on repayments.
By letter dated the 18thJuly, 2014 Start Mortgages demanded immediate repayment of the sum of €981,886.28.
The defendant objected to the application proceeding to judgment until resolution of all complaints made by him to the Financial Services Ombudsman.
The High Court was adamant that it could proceed to deal with the matter despite the complaint residing with the Financial Services Ombudsman and remaining unresolved. However, the court could put a stay on any order that issued and in the event that theFinancial Services Ombudsman would make a determination which would suggest that the application was brought prematurely then invite the parties to make submissions as to whether that ought to be reflected in any costs order that the court might make.
Significantly, this case illustrates that just because a defendant/customer of any bank or credit union makes a complaint to the Financial Services Ombudsman that does not prevent the bank/credit union proceeding to obtain judgment even though a stay could beput on execution of the judgment.
Think before you act