Civil Fraud Quarterly Round-Up: Q1 2021
Over recent years, the courts have made it clear that a very high degree of deference is to be shown to decisions made by Ombudsman services. Only last year, the High Court – in refusing an application for permission to apply for judicial review in R (Sharma) v Parliamentary & Health Service Ombudsman  EWHC 2609 – highlighted the prevailing view of the courts that although judicial review of the Parliamentary Ombudsman is permissible, it will be a rare event. This trend resurfaced again last month in a decision concerning the Financial Ombudsman Service (“the ombudsman”).
In R (Green) v The Financial Ombudsman Service Ltd  EWHC 1253, the ombudsman had found that Mr Green, a financial adviser, had misled his clients, Mr and Mrs Gunner, on the risks associated with a pension drawdown scheme, a finding which Mr Justice Collins clearly accepted. In his decision, the ombudsman went a step further and concluded that the Gunners would not have entered into drawdown arrangements had they been advised properly about its risks; a conclusion Mr Green challenged.
Although not expressly stated in his judgment, it is evident that Mr Justice Collins did not himself agree with the ombudsman’s conclusion on causation – namely that the Gunners would not have entered into the scheme if they had been given proper advice – noting that, “hindsight does sometimes change perceptions.”
However, what Mr Justice Collins was very clear about, was that it was not a decision he was able to overturn. The test he had to consider was whether the decision was irrational in the Wednesbury sense, and it simply was not.
Of future interest to Ombudsman services and those thinking of challenging their decisions was the discussion of the scope of the deference to be shown to the Financial Ombudsman, and Mr Justice Collins remarks that where a decision maker has a particular expertise and is given a wide discretion, such as the Financial Ombudsman, it will be very difficult to establish that a particular decision was irrational.
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