Carey Pensions case could be appealed: What happens now?

Hannah Godfrey reports

Earlier this week Carey Pensions, which has since rebranded to Options Pensions, won its lengthy legal fight with former client Russell Adams, with Adams’ claims dismissed on all grounds.

Options Pensions has since confirmed to Professional Adviser that Adams has applied for permission to appeal. Managing director Christine Hallett told PA: “Mr Adams has applied for permission to appeal, the outcome of which is awaited. Options will not be making any further comment whilst that process is ongoing.”

Peter Murphy, managing director at law firm Sackers, said whether or not permission to appeal is granted is based upon whether there is “a real prospect of success” at appeal stage, or if there was some sort of “compelling” reason for appealing.

Murphy stressed he did not know enough about the specifics of the Carey case to give a view on whether or not the appeal would be granted, but noted there was “very little to lose” at this point by asking for permission to appeal.

In order to seek permission to appeal, those appealing typically first ask the court in which the case was heard. If they are not granted permission by that court, they can go to the Court of Appeal and ask for permission again.

How quickly permission to appeal is given can vary by months. If permission is granted at the lower court, in Russell Adams’ case that would be the High Court, Murphy said it usually is granted within a week.

However, if those seeking permission go to the Court of Appeal, a document must be filed to the court within three weeks of the decision, which will generally be heard by the court within the next month. Murphy said it could take two months to be granted permission to appeal from the Court of Appeal, and then it could be months before a hearing.

Murphy stressed if permission to appeal was granted, it does not mean an appeal will go ahead, it merely gives those involved more options. Additionally, he said just because a case requires “a real prospect of success” to be granted permission, or some sort of “compelling” reasoning, it does not mean the appeal will ultimately succeed.

“There are plenty of appeals that don’t succeed, even though they have been granted permission to appeal,” he added.

The Carey Pensions case has already rumbled on for more than two years. The result of the case had been keenly awaited by the self-invested personal pension (SIPP) industry, as it was thought it would give clarity on the duty and obligations of SIPP providers.

During the 2018 trial, Adams’ representatives argued Carey had breached Financial Conduct Authority COBS rules that dictate a firm must act in a client’s best interest by allowing Adams to use Carey’s SIPP to invest in a risky, unregulated Store Pods scheme. Carey, meanwhile, argued SIPP providers were under no obligation to reject the investment.

How does this affect the FOS?

The FOS has occasionally faced criticism from the industry for its handling of SIPP claims. Fellow SIPP provider Berkeley Burke was granted permission to appeal a High Court judgment delivered against it in October 2018, which rejected the firm’s initial claim against an ombudsman’s decision that ruled it had to compensate a client after the provider failed to carry out appropriate due diligence on their investment.

Following the win for Carey Pensions, the FOS told Professional Adviser: “The High Court has already upheld our approach to SIPP complaints in the Berkeley Burke case. We will consider the judgment in the Carey case and continue to take relevant law, including case law, into account when resolving complaints. If customers are unhappy with how their financial provider has handled their complaints, they should come to us and we’ll see if we can help.”

Regardless of the potential appeal, the FOS has told PA it will continue to consider the initial judgment when looking at cases.