The Claim

The Claimant, Bluefin Insurance Services (“Bluefin”) sought judicial review of the Defendant’s decision that Mr Lochner, a Director of Betbroker Limited, was eligible to bring a complaint to FOS on the basis that he was a “consumer”, defined in the Glossary to the FCA Handbook as being a “natural person acting for purposes outside his trade, business or profession.”

In 2007 the Claimant secured a Directors and Officers Policy (“D&O Policy”) for Betbroker Limited, which was underwritten by AIG Europe Limited (the “Insurer”). Mr Lochner was an “insured person” under the terms of the policy. Following a claim brought by a third party, Mr Lochner raised a complaint to FOS that the Claimant had failed to notify the Insurer of the potential claim under the D&O Policy. Due to this alleged failing, the Insurer rejected cover for Mr Lochner, and as a result he suffered a loss for which he believed Bluefin should be liable.

The Claimant applied for Judicial Review of the FOS decision on two fronts. Firstly the Claimant sought to show that FOS’s decision as to whether Mr Lochner was a consumer was an issue of precedent fact, relating to the FOS’s own jurisdiction and so therefore one which a Court needed to decide. The Claimant argued that the suggestion that a public body could decide for itself the extent of its own jurisdiction was unsound and that the FCA Handbook gave FOS a clearly defined jurisdictional threshold, to which there was either a right or wrong answer.

Secondly, the Claimant sought to show that Mr Lochner had not been acting as a consumer, i.e. a person acting for purposes outside of his profession at the time of purportedly notifying the Claimant of the potential claim, and so was ineligible to bring a complaint. The Claimant contended that Mr Lochner was only insured under the D&O Policy for the purpose of his employment and, while it provided personal protection, it did so solely in respect of his employment.

The Decision

An Issue of Precedent Fact

Mr Justice Wilkie held that the principles set out in R (on the application of A) v Croydon London Borough Council provide a clear statement of the approach to be taken.

It was held that FOS would only have compulsory jurisdiction so long as the complaint was one to which compulsory jurisdiction applied. The FCA Handbook states access to compulsory jurisdiction is only available where the complainant is eligible. The question of whether an individual satisfied the criteria of being a ‘consumer’, and therefore was eligible to bring a complaint, was an objective decision which involved assessing whether the complainant fell within a series of well defined, clear criteria.

On this basis it was held that the question of eligibility to bring a complaint was an issue of precedent fact and that, upon being challenged by way of Judicial Review, was a decision which the Court had to take.

Eligibility: A Consumer?

The Court disagreed with the Claimant’s argument that the question of the complainant’s eligibility should arise at the time of the action to which the complaint related. Mr Justice Wilkie held that FOS’s argument that the question of eligibility arose at the time of the complaint was the correct approach.

However, the Court sided with the Claimant on the issue of whether Mr Lochner constituted a consumer.

The claim for alleged wrongful acts to which the complaint related was brought when Mr Lochner was acting as a Director of Betbroker Ltd, and that those acts were wholly in the course of his trade, business or profession. The Court stated that the fact that the complaint was brought in his  personal capacity, as a result of his personal liability for the alleged wrongful acts did not alter this. It was held therefore that FOS had no legal basis to conclude that the complaint was made outside of the course of the complainant’s trade, business or profession, and therefore Mr Lochner could not fall within the definition of consumer under the FCA Handbook. As a result the Claimant’s judicial review was successful, and Mr Justice Wilkie ordered that FOS’s decision to entertain Mr Lochner’s complaint be quashed.


This decision provides some much needed guidance in establishing who, under the definition of ‘consumer’, can make a complaint to the Financial Ombudsman Service. It makes it clear that those who seek to pursue financial institutions via the Financial Ombudsman Service in any kind of “business capacity” are likely to be unsuccessful. The case serves as a strong reminder that the Financial Ombudsman Service is there to protect consumers and cannot be misused.

For further information, please contact Georgina Squire or the Partner with whom you usually deal.