The claimant sought damages for breach of the statutory duty in ICOB, and for damages for negligence. The bank faced a claim that it had assumed responsibility to take reasonable care in recommending the policy it did. The bank had relied on the content of a specific ICOB 4 rule to say that, as it was advising only on a single premium product, the extent of the advice it could offer on suitability was limited; it had met the requirements of the rules, which did not require it to advise on regular premium policies as an alternative nor on the products of other firms, the details of which it would not know. The claim in negligence was resurrected as an alternative. The claimant alleged that if the bank was entitled to avoid liability under the rules on that basis, a duty of care arose in the alternative to give that wider advice.
Held: The claim failed. HHJ Waksman said: ‘Given that ICOB (‘Insurance: Conduct of Business’) prescribed a detailed code on how an intermediary in the position of the Bank should conduct itself when purporting to give advice in respect of a single product ie whether to recommend it or not, I see no reason why any co-terminous duty of care should extend more widely. Moreover, the fundamental point raised by rule 4.3.7 (1) above was that the question of cost can only sensibly be dealt with by a comparison with other products. If (as here) the Bank cannot engage in such an exercise because of its very limited advisory role, I cannot see how it could be expected to advise more widely on the question of cost under a common-law duty of care. Its inability to make a comparison remains, as does the difficulty of imposing some sort of obligation to pronounce nonetheless upon whether the PPI was expensive according to some other standard.’
HHJ Waksman QC
[2010] EWHC 3152 (QB), [2011] CTLC 1, [2011] Lloyd’s Rep IR 455
Bailii
England and Wales
Cited by:
Cited – British Bankers Association, Regina (on The Application of) v The Financial Services Authority and Another Admn 20-Apr-2011
The claimant sought relief by way of judicial review from a policy statement issued by the defendants regarding the alleged widespread misselling of payment protection insurance policies, and the steps to be taken to compensate the purchasers. They . .
Cited – Barnes and Another v Black Horse Ltd QBD 31-May-2011
barnes_blackQBD11
The claimants sought repayment by the bank of sums paid to them for Payment Protection Insurance policies sold to them in connection with loans made by the bank. The Bank now resisted an application for leave to amend the particulars of the . .
Lists of cited by and citing cases may be incomplete.
Financial Services, Torts – Other
Updated: 09 November 2021; Ref: scu.426914