What's in a name? Court brings seven-year legal battle over the word 'ombudsman' to a close

Chief Ombudsman Peter Boshier says he will now take steps to allow Financial Services Complaints Limited to call itself "ombudsman". Photo / NZME

The Court of Appeal has put an end to seven years of legal battles by directing that a private company that handles disputes in the financial services industry can call itself an "ombudsman".

The court's decision overrules repeated decisions by the Parliament-appointed Chief Ombudsman to deny the use of the protected word to the non-profit Financial Services Complaints Limited.

The parliamentary ombudsdman, who has a watchdog role to investigate complaints about Government ministers and state agencies, has resisted allowing another entity to use "ombudsman", fearing confusion and a loss of public confidence in the parliamentary ombudsdman's office.

For these reasons, the Ombudsmen Act of 1975 banned the use of the word ombudsman by any business or service provider without the Chief Ombudsman's written permission.

However, there were two exceptions allowed under the law – for a Banking Ombudsman, and an Insurance and Savings Ombudsman, both of which were provided by the private sector.

In addition, Financial Services Complaints Limited (FSCL) was given a "savings provision" in the Ombudsmen Act to be allowed to use the title ombudsman if it could get permission to do so.

FSCL has been trying to gain that permission since 2015, when its competitor offering an insurance and savings scheme changed its name to the Insurance and Financial Services Ombudsman.

FSCL said it was worried consumers would view its disputes resolution scheme as inferior to the two others in the financial sector that were describing themselves as ombudsmen. It also cited "consumer confusion".

FSCL's bid has been repeatedly rejected, first by former Chief Ombudsman Dame Beverley Wakem and then by her successor Peter Boshier - twice.

FSCL has sought to have the decisions reviewed through the courts and the matter has now been the subject of seven judgments in the High Court and Court of Appeal.

The parliamentary office-holders have argued that allowing FSCL to use the term ombudsman would confuse the public and risked undermining public understanding of, and confidence in, the role of the parliamentary ombudsman.

However, in its latest decision, a bench of three judges in the Court of Appeal said there was no "objectively supportable basis" for this.

The judges said that sending the matter back for a delegate of the Chief Ombudsman to reconsider would be unfair, and it was time for the appeal court to make its own views known.

"It is not in FSCL's interests, nor the interests of justice generally, to allow this matter to continue," the court judgment said.

The bench issued a declaration that FSCL is "entitled to the Chief Ombudsman's consent to use the ombudsman name in connection with its dispute resolution scheme".

Boshier told Open Justice he accepted the court's decision and would now take steps to grant FSCL consent to use "ombudsman" in its branding for its dispute resolution service.

"I hope this judgment by the Court of Appeal brings this matter to an end," he said.

"At the time I was considering the application, the law prevented the name 'ombudsman' from being used without my permission," Boshier said.

"Parliament agreed to change the law and applications for use of the name are now considered by the Minister of Justice."

The court was told that 7000 financial service providers participate in the FSCL scheme, compared with 4600 for the Insurance and Financial Services Ombudsman and 19 for the Banking Ombudsman.