The claimants had brought proceedings against the defendant banks for negligent advice. The claimants then applied to the Financial Ombudsman Service (FOS) to hear the complaint but the FOS declined to hear the complaint whilst proceedings were in progress in the courts. The claimants therefore applied for a stay to which the banks did not consent on the basis that they did not want further delay in the claim.
Granting the stay, the court held that this was not a case where the claimants had intentionally delayed proceedings. If the stay was not granted, the claimants would be prejudiced by not being able to pursue the more informal and cost effective FOS procedure. Furthermore, the banks would not suffer prejudice by a delay of up to one year. If the claimants were not successful before the FOS, they were free to re-start proceedings; that was not a ground for denying a stay. The court acknowledged, however, that as there was a maximum that could be awarded by the FOS, the claimants may wish to pursue the banks even if successful with the FOS. It was agreed that the claimants would give an undertaking that they would not continue proceedings if they obtained an award (though we query whether this was necessary given the judgment in Clark v In Focus) and the stay was granted.