The establishment of the Financial Services Tribunal in terms of the Financial Sector Regulation Act of 2017 brought much needed legal certainty to financial advisers and the public.
Its predecessor, the FSB Appeal Board, was very limited in terms of its mandate as far as FSPs were concerned, apart from complaints relating to the (then) FSB and the FAIS Ombud.
The Tribunal’s mandate is much wider:
“… a person who is aggrieved by a decision of a decision-maker may apply to the Tribunal for a reconsideration of the decision”. Both terms are clearly defined in section 218 of the Financial Sector Regulation Act. A cursory glance at the cases determined by the Tribunal will show that anyone, from a representative to Markus Jooste, may approach this forum if unhappy about a decision.
On good grounds only
Access to free dispute resolution forums have seen multiple complaints from people with very little chance of success, but, hey, it’s free and they have nothing to lose. This applies particularly to the various industry ombuds. The FAIS Ombud and the Pension Funds Adjudicator (PFA), similarly, spend more time on complaints that do not fall under their mandate, mostly from people hoping for a beneficial outcome, rather than justice.
The Tribunal, specifically, has made mincemeat of such approaches, declining it in one very clear sentence, such as this one:
“The application for reconsideration is summarily dismissed because it is frivolous because it contains no grounds of any merit and is based on suppositions.”
Other terms used include “frivolous” and “vexatious”, which essentially mean that the Tribunal offers an opportunity for justice, not vengeance.
In a decision received this morning, the Tribunal noted:
“The issue is a crisp one but the paralegal firm that represents (informally if not formally) the applicant raised many side-issues, expressing its dissatisfaction through the applicant with decisions of the Tribunal and the PFA that have nothing to do with this case. There is also a personal attack on the competence of a member of the PFA, something unacceptable. Do not shoot the messenger because you dislike the message. Decorum and respect have their place in society.”
The ground rules
There are some basic rules that must be followed, but the Tribunal has the power to relax some of these if there are sufficient grounds.
An application for reconsideration must be made:
- if the applicant requested reasons in terms of section 229 of the Act, within 30 days after the statement of reasons was given to the applicant; or
- in all other cases, within 60 days after the applicant was notified of the decision, or such longer period as may on good cause be allowed.
An application for condonation may be made – for instance, for late application – but it must be succinct and show good cause.
If opposed by an interested party, the grounds of opposition must also be stated succinctly.
Depending on the nature of the application, the application, opposed or unopposed, may be decided on the papers by the Chairperson or the Panel Chairperson presiding over the Tribunal panel, or by the Tribunal panel during the hearing.
- An application for reconsideration must contain the:
- decision letter; and
- statement of reasons and any other information, including annexures provided to the applicant by the decision-maker.
- The application for reconsideration must contain the full particulars of the grounds (stated succinctly) on which the application is based and, if necessary, must deal with the aspect of condonation should the application be filed out of time.
- An application for reconsideration, to be valid, must cite all other parties to the decision and be lodged with the secretariat AND all the other parties to the decision.
- The application for reconsideration must be drafted to conform as far as possible with either the standard Form A or B provided on the Tribunal website. These documents provide excellent guidance on what is required.
- Upon receipt of the application for reconsideration, the decision-maker must, within 30 days of the date of receipt thereof, furnish the Tribunal secretariat with the relevant underlying documents on which the decision was based together with further reasons, where necessary. Records that do not comply with this provision will be returned to the decision-maker.
- The applicant may, within 10 days of the date of receipt of the decision-maker’s underlying documents and further reasons amend or augment the grounds on which the application is based, if necessary.
FAIS Ombud and PFA decisions
An application for leave to reconsider an Ombud decision must be lodged with the secretariat AND all other parties to the decision. It must be in accordance with Form C contained in the Consolidated Rules published on 1 June 2021. (Click here to download the Tribunal’s rules.)
Similarly, approaches regarding decisions by the PFA need to follow the rules laid down in the same document.
Other noteworthy information
Legal representatives must file heads of argument, which must generally comply with the rules for heads of argument in the Constitutional Court or the Supreme Court of Appeal and may not exceed 25 pages.
Persons who are not legally represented do not have to file heads of argument.
The argument is limited to the grounds upon which the application for reconsideration is based. Generally, no new or additional information is allowed.
Any party who is dissatisfied with an order of the Tribunal may institute proceedings for a judicial review of the order in terms of the Promotion of Administrative Justice Act or any applicable law.
An order of the Tribunal made in terms of section 234 of the Act has the effect of a civil judgment and may be enforced as if lawfully given in a competent court.
Justice in action
Some 419 cases were heard by the Tribunal in the past two years. In many of these, the underdog got at least some satisfaction in that the respondents were instructed to review their decisions in the light of legal guidelines provided by the Tribunal. This, often in instances where the respondents were big organisations with large legal departments, or FSPs who failed to follow due process, using the disciplinary process to settle personal scores.
So, if you feel aggrieved, and believe you have a legitimate case, the Tribunal is there to assist you.