In a world where the various ombudsmen are replacing the Courts for the resolution of consumer claims, what happens when two or more respondent firms are covered by the jurisdiction of different ombudsman schemes? For example, what if a mortgage borrower wants to claim against his conveyancing solicitor and his mortgage broker at the same time?

The FOS, Pensions Ombudsman (PO) and Legal Ombudsman (LO) all have rules allowing for the determination of complaints against two or more respondents but these are assumed to be respondents subject to the same relevant jurisdiction.  They each also provide for the dismissal of complaints without consideration of the merits if the matter is already being, or would be more appropriately, dealt with by the Courts or another complaints scheme (e.g. DISP 3.3.4, LO Scheme Rules 5.7 and 5.12-13).

The FOS and PO have in place a MoU which says they will “take steps to agree how each case will be handled subject to the relevant rules of investigation and the complainant’s wishes“. Despite promising regular review, this MoU has been in place since October 2002. It does not – and cannot – provide for an over-arching jurisdiction capable of apportioning liability between different types of respondent. 

Although it currently has no such MoU in place with either scheme, the LO says it is “currently developing agreements with other Ombudsman schemes“.  I anticipate that, even if this (admittedly rare) problem has arisen or occurred to the draftsmen, nothing short of statutory provisions will enable ombudsman to co-ordinate decisions so as to allocate responsibility across their separate jurisdictions.

Maybe this rather hypothetical issue will be resolved soon by practical work-arounds like the FOS / PO MoU.  In any event, the point highlights the limitations of statutory complaints schemes that have jurisdiction over only those voluntarily involved in a certain regulated activity.

In practice, the respondent firm first found liable by any of the ombudsmen is left to sue any other responsible firms in court for a contribution towards the damages.  Not only is this costly, but the different tribunals could reach different decisions, with firms unfairly assessed by differing standards.