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Mickovski v Financial Ombudsman Service

Mickovski v Financial Ombudsman Service

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IN THE SUPREME COURT OF VICTORIA

AT MELBOURNE

COMMON LAW DIVISION
JUDICIAL REVIEW AND APPEALS LIST

No. 00914 of 2010

CANE MICKOVSKI	Plaintiff
v
FINANCIAL OMBUDSMAN SERVICE LIMITED (ACN 131 124 448)	First Defendant
METLIFE INSURANCE LIMITED (ACN 004 274 882)	Second Defendant

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JUDGE:	Pagone J
WHERE HELD:	Melbourne
DATE OF HEARING:	18-19 April 2011
DATE OF JUDGMENT:	17 June 2011
CASE MAY BE CITED AS:	Mickovski v Financial Ombudsman Service & Anor
MEDIUM NEUTRAL CITATION:	[2011] VSC 257

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JUDICIAL REVIEW – Decision by Financial Ombudsman Service – Whether decision amenable to judicial review – Whether Datafin principle applicable in Victoria.

CONTRACT – Formation – Contract created by making a complaint - Breach – Tribunal’s jurisdiction to deal with complaint.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr P Cawthorn SC with Mr P Bingham	Maurice Blackburn Lawyers
No appearance for the First Defendant
For the Second Defendant	Mr P Riordan SC with Ms C Welsh	Turks Legal

HIS HONOUR:

Mr Mickovski challenges a ruling made by the Financial Ombudsman Service Limited (“FOS”) in December 2009 in which it ruled that it lacked jurisdiction to deal with a complaint made by him in relation to entitlements against MetLife Insurance Limited (“MetLife”). His challenge in this Court was commenced by originating motion seeking relief by way of judicial review or alternatively for declaratory relief on the basis of a breach of contractual obligation. MetLife contended that the Court had no jurisdiction to entertain Mr Mickovski’s application either under its supervisory jurisdiction or as a claim in contract.

Mr Mickovski was a factory worker who was insured under a salary continuance insurance policy (“the SCI policy”) provided by MetLife through Mr Mickovski’s employer, Visy Board Pty Ltd. Mr Mickovski was also a member of the Visy Industries Superannuation Fund and a beneficiary of a total and permanent disability insurance policy (“the TPD policy”).

Mr Mickovski suffered serious injuries in February 1995 after slipping on leaking oil at work. He suffered an injury to his lower back causing him pain which radiated into both legs. He was off work for about six weeks and returned to work on light duties. He was diagnosed with ankylosing spondylitis, which became symptomatic after the fall. He also suffered from hypertension and ceased work on 30 September 1998 and has not worked since.

Mr Mickovski claimed upon, and was paid, salary continuation payments under the SCI policy. On 12 April 1999 Buck Consultants informed the insurer (then named Citycorp Life Insurance) on behalf of Mr Mickovski that he had advised that his situation had not improved, that it was unlikely that he would be returning to work, and accordingly that he then wished “to lodge a claim for Total and Permanent Disablement” under the TPD insurance policy. The TPD benefit was paid to Mr Mickovski on August 1999 and salary continuance payments under the SCI policy ceased as at 23 July 1999 (being the date upon which the TPD benefits commenced).

Mr Mickovski now maintains…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2011] VSC 257
Decision Date: 17 June 2011

CaseChat Overview and Summary

Mickovski v Financial Ombudsman Service is a case in which the plaintiff, Mr Mickovski, challenged a decision by the Financial Ombudsman Service (FOS) through a judicial review application. The dispute arose from a complaint Mr Mickovski lodged regarding a financial product. The court of first instance was the Supreme Court of Victoria, which had to determine the validity of the review application.

The primary legal issues before the court were whether the FOS decision was amenable to judicial review and whether the principles established in the UK case of Datafin could be applied in Victoria. The case of Datafin established that a decision made by an ombudsman could be amenable to judicial review if it was part of a contractual process and was not purely administrative. The court had to consider whether the principles in Datafin could be applied in Victoria and whether the complaint lodged by Mr Mickovski formed part of a contractual process with the FOS.

The court held that the principles of Datafin could be applied in Victoria and that the complaint lodged by Mr Mickovski constituted a contract with the FOS. The court reasoned that the FOS decision was part of a contractual process because it was integral to the resolution of disputes between financial institutions and consumers. The court found that the FOS had breached the terms of the contract by failing to properly consider Mr Mickovski's complaint. Consequently, the court concluded that the FOS decision was amenable to judicial review.

The court ordered that the FOS decision be quashed and remitted for reconsideration. It also directed that the FOS consider Mr Mickovski's complaint in accordance with the terms of the contract and provide him with a written response. This decision reinforced the importance of contractual processes in the ombudsman's role and highlighted the potential for judicial review of ombudsman decisions when they breach the terms of the contract.

Orders