UK - A U-turn by the pensions ombudsman over awarding legal costs for "non-exceptional circumstances" has been attacked by law firms.
They fear David Laverick’s move – highlighted in his determination on Mrs O’Connor v Darwin Clayton – will only complicate his office and slow down the pro-cess of making a claim.
Laverick ordered the trustees of insurance broker Darwin Clayton’s pension scheme to pay Mrs O’Connor £13,825 as “redress for expenses incurred as a result of their maladministration”.
But lawyers say this order conflicts with the notion members should seek free advice from pensions advisory service, OPAS.
Allan & Overy head of pensions Derek Sloan said Laverick’s approach was at loggerheads with the way the previous ombudsman, Julian Farr-and, worked.
He said: “In the Farrand days, the tendency was not to award legal costs.
“His approach was: ‘I am here, I investigate, I am a free service and you don’t need to clog the whole system up with lawyers’.” Simmons & Simmons solicitor Kirsty Bartlett warned that more legal representation could lead to an unnecessary need in costs and time.
She also pointed out that the ombudsman had taken the opportunity at the start of the year to attack lawyers for time wasting.
But the Office of the Pensions Ombudsman casework director Tony King said the ombudsman took the view that his directions should remedy the injustice caused by maladministration.
This should put the complainant back into the position he or she would have been in if there had been no maladministration.
He said: “Provided the ombudsman considers the costs were reasonably incurred, and are themselves reasonable, he takes the view that it will often be proper to order that those costs should be reimbursed along with any other expenses which have resulted in consequence of the maladministration.”
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