Claw Back Commission

dunstonh

Once Court procedings have started FOS cannot intervene but if an Ombudsman decised they cannot charge you then that will be legally binding on them and a court would have to follow that decision.

magpiecottage, that makes sense and follows my understanding. However, I was also of the understanding that the court would likely want the FOS process to complete first if its already in process. Although that is at the opinion of the judge (on the basis with small claims that you have to be seen to do as much as you can to resolve the issue without court action).

Therefore getting it into the FOS before court action starts would be important.

Incidentally, whilst DaCouch is right that Compliance Consultants CAN be expensive, I would charge them a lot less per hour than they want to charge you!

This firm is directly authorised as well so they either use compliance consultants or do it in house.

Badger72

magpiecottage wrote: »

I recommend you print off copies of ALL correspondence between you and them and the FOS form, complete it and send it off first class today. Once Court procedings have started FOS cannot intervene but if an Ombudsman decised they cannot charge you then that will be legally binding on them and a court would have to follow that decision.

Equally if the FOS say that I am wrong then it wouldn't go through the courts. So I am now thinking that I may have more chance through the courts rather than a professional industry body.

dunstonh

Equally if the FOS say that I am wrong then it wouldn't go through the courts.

No. The FOS ruling is binding on the FSA regulated firm. It is not binding on you.

The FOS is probably slightly more consumer biased than the court in that it also considers fairness. The court will just look at law.

Quentin

From what you have told us this won't go to court (the broker would have to pay for all the court fees, with (from what you have told us) no contract in place to rely on). Additionally, any expenses you incurred over attending a hearing would have to be paid by the broker!

All in all it would be a complete waste of money plus a possible telling off from the judge for wasting the court's time as well as worrying you!

Badger72

dunstonh wrote: »

No. The FOS ruling is binding on the FSA regulated firm. It is not binding on you.

The FOS is probably slightly more consumer biased than the court in that it also considers fairness. The court will just look at law.

The way I see it. If i complain to the FOS and they judge me to be wrong then I HAVE to pay. If I don't and ignore the court threat, they may not take me to court (though I agree it looks likely that they will try).

magpiecottage

Badger72 wrote: »

The way I see it. If i complain to the FOS and they judge me to be wrong then I HAVE to pay. If I don't and ignore the court threat, they may not take me to court (though I agree it looks likely that they will try).

No - a Ombudman's decision is legally binding on both parties provided the complainant accepts the decision. If they do not then it has no validity in law.

In other words, if an Ombudsman issues a decision that no charge then, provided you get written confirmation back to the FOS that you accept that decision within one month then that will be the end of the matter. If the firm then take you to Court, the Ombudsman's decision is a defence that the Court will not be able overturn.

If the Ombudsman rules against you, then you do NOT have to pay unless you tell the Ombudsman you accept the decision (which you are not obliged to do).

On the other hand, if they take you to court and win, you will also have to pay the court fee - another 10%. Even if you go to FOS and lose, at least you will know that it is probably not worth contesting in court - and it will not cost you to go to FOS.

Based on what you have said, I think it very unlikely that an Ombudsman would rule in favour of the firm - particularly as an Ombudsman, unlike a court, would probably look at the affordability issue and may throw it out on those grounds anyway (and if it was not cancelled under the cooling off notice might even award reimbursement of premiums paid).

However, once court proceedings are issued, the FOS has to defer to it unless both parties agree to stay them in favour of FOS - and it is unlikely that the firm would do so as it will probably realise its chances of success will be considerably reduced.

I have seen similar cases of this nature and therefore recommend you go to FOS now because otherwise it can quickly become very messy and possibly expensive.

magpiecottage

dunstonh wrote: »

This firm is directly authorised as well so they either use compliance consultants or do it in house.

I generally work with directly regulated firms although I do work for networks (and sometimes life offices) from time to time.

Badger72

magpiecottage wrote: »

No - a Ombudman's decision is legally binding on both parties provided the complainant accepts the decision. If they do not then it has no validity in law.

In other words, if an Ombudsman issues a decision that no charge then, provided you get written confirmation back to the FOS that you accept that decision within one month then that will be the end of the matter. If the firm then take you to Court, the Ombudsman's decision is a defence that the Court will not be able overturn.

If the Ombudsman rules against you, then you do NOT have to pay unless you tell the Ombudsman you accept the decision (which you are not obliged to do).

On the other hand, if they take you to court and win, you will also have to pay the court fee - another 10%. Even if you go to FOS and lose, at least you will know that it is probably not worth contesting in court - and it will not cost you to go to FOS.

Based on what you have said, I think it very unlikely that an Ombudsman would rule in favour of the firm - particularly as an Ombudsman, unlike a court, would probably look at the affordability issue and may throw it out on those grounds anyway (and if it was not cancelled under the cooling off notice might even award reimbursement of premiums paid).

However, once court proceedings are issued, the FOS has to defer to it unless both parties agree to stay them in favour of FOS - and it is unlikely that the firm would do so as it will probably realise its chances of success will be considerably reduced.

I have seen similar cases of this nature and therefore recommend you go to FOS now because otherwise it can quickly become very messy and possibly expensive.

Superb and many many thanks. Just to clarify, I write to the Insurance firm tomorrow, recorded del, advising that am making a formal complaint and that they have 8 weeks to reply. If/when they reply I then send complaint form to the FOS. So I don't for now write to the FOS?

magpiecottage

Badger72 wrote: »

Superb and many many thanks. Just to clarify, I write to the Insurance firm tomorrow, recorded del, advising that am making a formal complaint and that they have 8 weeks to reply. If/when they reply I then send complaint form to the FOS. So I don't for now write to the FOS?

No - if have already written and complained and they have come back threatening to take you to Court then go to FOS with copies of both your complaint and the subsequent letter threatening court action. You are effectively in a race with them and need to get your complaint to FOS before they submit the papers to the Court.

If you indicate you are going to FOS they may submit the papers to the court immediately.

Make clear to FOS in the complaint form and covering letter that you are submitting the complaint to them now because their response to your complaint to them was to tell you they intend to take you to court and you need to get FOS to accept the complaint first.

Badger72

I called the FOS and registered complaint. Forms in post tomorrow. Recorded of course. Also wrote to the company trying to screw me over and informed them that I have complained (this is what the FOS recommended).