Ulster Bank appeals decision on compensation for three customers in tracker controversy

Ulster Bank said, among other things, the FSPO erred in his interpretation of the contracts and gave inadequate reasons for his decision.

The High Court has been urged to overturn decisions of the Financial Services and Pensions Ombudsman (FSPO) in relation to compensation in three cases of customers who complained to Ulster Bank in the tracker mortgage controversy.

The outcome of the three cases may have a bearing for thousands of other borrowers from the bank who were on trackers. The FSPO found borrowers were entitled to redress based on their entitlements under their tracker mortgage contract with the bank.

Ulster Bank appealed the decision saying, among other things, the FSPO erred in his interpretation of the contracts and gave inadequate reasons for his decision. The FSPO opposes the appeal, and the borrowers are notice parties to the case but cannot be named.

Dealing with one of the complaints upheld by the FSPO which found Ulster Bank had breached provisions of the 2017 FSPO Act in its conduct, Eoin McCullough SC, for Ulster Bank, argued the FSPO carried out no legal analysis of the decision. 

There was also a misinterpretation of the documentation relating to the mortgage by the FSPO, he said. The analysis that was carried out "just makes no sense in the ordinary meaning of the words" contained in the documents, he said.

What the court must do is find out what the documents meant, and the decision was inconsistent with the plain meaning of the documents, he said. Counsel also said there was no real clarity in relation to the finding of a breach of the Central Bank's Consumer Protection Code.

He said there are previous decisions of the FSPO's predecessor organisation, the Financial Services Ombudsman (FSO), which directly contradicted this decision.

Consistency in decisions is a value which has relevance to confidence in the law, fairness, and to reducing the risk or arbitrariness, he said. It is a matter of natural and constitutional justice which, if one is going to depart from it, has to be explained, he said.

There were serious errors to be found in the FSPO decision, individually or cumulatively, he said. It should be set aside and/or sent back to the FSPO for reconsideration, he said. The FSPO disputes the claims made by Ulster Bank.