FSCL wins legal battle to use the term "ombudsman"

FSCL wins legal battle to use the term "ombudsman" | Insurance Business New Zealand

FSCL wins legal battle to use the term "ombudsman"

The Court of Appeal has ruled in favour of non-profit dispute resolution service Financial Services Complaints Limited (FSCL), allowing it to use the title of “ombudsman”.

The court overturned multiple decisions of the Parliament-appointed Chief Ombudsman prohibiting FSCL from using the word, ending a seven-year-long legal battle, the NZ Herald reported.

The Chief Ombudsman investigates complaints regarding government ministers and agencies is protective about the title, saying allowing other entities to use it could cause confusion and a loss of public confidence in the parliamentary ombudsman’s office. The Ombudsmen Act of 1975 prohibits organisations to use the word ombudsman without written permission from the Chief Ombudsman.

The law provided two exemptions – a banking ombudsman, and an insurance and savings ombudsman, both of which were provided by the private sector, the report said. FSCL would also be allowed to use the word under the savings provision if given permission. However, it had been trying since 2015 to no avail. That year, a competing service was granted permission to change its name to the Insurance and Financial Services Ombudsman.

FSCL said it was worried consumers would consider it an “inferior” dispute resolution scheme compared to the two others in the financial sector that were using “ombudsman” in their names.

Following a protracted legal battle, the most recent Court of Appeal decision said that there was no “objectively supportable basis” for FSCL to be prohibited to use “ombudsman” in its name.

“It is not in FSCL's interests, nor the interests of justice generally, to allow this matter to continue,” the court judgment said, adding that FSCL is “entitled to the Chief Ombudsman's consent to use the ombudsman name in connection with its dispute resolution scheme.”

Chief Ombudsman Peter Boshier said he accepts the court's decision and will work to give FSCL the necessary consent to use “ombudsman” in its branding.