Widening the net: Emptage v FSCS

The Court of Appeal considered whether advice on an unregulated activity arising from a regulated activity was within the jurisdiction of the FSCS. It also considered the extent of the FSCS’s discretion determining whether, in the exercise of its discretion, it was entitled to exclude losses arising from an unregulated activity.

Mrs Emptage, the claimant, sought financial advice from her financial adviser about reducing her repayment mortgage of almost £40,000 on her home in Sandhurst. He advised her to re-mortgage with an interest-only mortgage of £112,000 and invest the balance in a Spanish apartment. Emptage followed that advice. Subsequently, the Spanish property market crashed and her investment turned out to be worthless. She was unable to repay the interest-only re-mortgage on her home. Her financial adviser was illiquid and uninsured, so the claim was dealt with by the FSCS.

The FSCS conceded that the advice was negligent and awarded compensation of £11,522 on the basis that it could only compensate for losses arising from the regulated re-mortgage on Emptage’s English property but not for losses arising from the Spanish investment (which was not regulated)…

If you are registered and logged in to the site, click on the link below to read the rest of the Mills & Reeve briefing. If not, please register or sign in with your details below.

Sign in or Register to continue reading this article

Sign in

Register

It's quick, easy and free!

It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.

Register now

Why register to The Lawyer

 

Industry insight

In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.

 

Market intelligence

Identify the major players and business opportunities within a particular region through our series of free, special reports.

 

Email newsletters

Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.

More relevant to you

To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.

Overview

Fountain House
130 Fenchurch Street
London
EC3M 5DJ
UK

Turnover (£m): 79.50
No. of lawyers: 367