A pension trustee company has lost a High Court appeal over being ordered to pay €2,000 of compensation for refusing to transfer a client’s pension to another provider.
Independent Trustee Co Ltd (ITCL) claimed the Financial Services and Pensions Ombudsman (FSPO) was wrong to order it to pay €2,000 to a man who had refused to fully complete an ITCL-provided “certificate of discharge” form so his pension funds could be transferred to Zurich.
The man signed the form but declined to entirely complete it as he felt it was neither legally necessary, in that it was neither a statutory or contractual requirement, nor relevant.
He argued the transfer of the funds, which were in Personal Retirement Savings Accounts (PRSAs), should proceed without completion of the certificate.
ITCL insisted it would not perform the transfer without the fully completed form and the matter went through the company’s internal dispute resolution process.
There was no resolution and the man made a complaint to the FSPO, who found in May 2021 that ITCL had unreasonably refused to complete the transfer request.
The FSPO maintained ITCL was not entitled, either under the terms of the business itself or under law, to withhold the transfer.
ITCL appealed to the High Court arguing the FSPO was wrong in finding that the complaint related to ITCL’s conduct as a financial services provider rather than a pension provider.
This was in circumstances where the FSPO found the complaint related to the release of funds from the PRSAs, rather than being in relation to the PRSAs themselves.
Ms Justice Niamh Hyland rejected ITCL’s case.
She said the heart of the ITCL appeal was that the FSPO ought to have treated it as a pensions provider and therefore should have determined the complaint under section 61 of the Financial Services and Ombudsman Act of 2017. This would have ended the appeal if the court found in ITCL’s favour, she said.
However, the FSPO dealt with the complaint under section 60 of the Act, relating to financial service providers. Despite assertions from ITCL that this was incorrect, the ombudsman stood by his decision.
The judge found ITCL came within the definition of a pension provider, as well as a financial service provider, under the 2017 Act at the relevant time.
The Act, she said, permits the FSPO to choose which way to proceed and can only be found incorrect if the decision is invalidated by a serious and significant error or series of such errors, she said.
In the circumstances of this complaint, the FSPO did not make a serious and significant error in deciding that, having regard to the nature of the complaint, it was appropriate to consider the complaint under section 60 of the Act, she said.
