The High Court dismissed Jacqueline and James McEvoy’s appeal against a Financial Services Ombudsman decision on their complaint about information concerning a fixed-rate mortgage breakage fee.
The couple told the Ombudsman that, during a telephone call with a Permanent TSB agent on 11 August 2008, they were advised they could leave a five-year fixed-rate term for a €100 breakage charge. They said they relied on that information when choosing the term, but were later told it would cost €16,500 to break it. The bank maintained that the €100 was an administration fee and that the couple had been on notice of the conditions applying to their mortgage.
The Ombudsman rejected the complaint in a decision dated 21 April 2011. As recounted in the High Court judgment, he considered the call transcript and mortgage documents, including a condition addressing fixed-rate loans. He was satisfied that the couple had been told a possible breakage fee depended on interest rates and the time remaining on the term, and that a separate €100 administration charge applied when switching products. He accepted that the agent could have explained the possible breakage fee more precisely, but was not satisfied the call information had prompted the couple to choose the five-year rate.
The couple appealed on the merits, without raising a procedural challenge. The High Court applied the test for appeals from Ombudsman decisions: the appellants had to establish, on the civil standard, that the adjudicative process as a whole was vitiated by a serious and significant error or series of errors. The court also had to take account of the Ombudsman’s expertise and specialist knowledge.
Mr Justice Gilligan said the court should not put itself in the Ombudsman’s position or second-guess the decision on its merits. He concluded that the McEvoys had not established a serious or significant error in the adjudicative process and dismissed their appeal. The judgment does not order payment of the disputed fee or make a new determination of the mortgage complaint.