The Financial Services Tribunal (FST) has made a costs order against an applicant who sought to have his debarment to be reconsidered.
King Price Insurance debarred the applicant, “TC”, for non-compliance with the Fit and Proper Requirements, specifically, the requirements for honesty and integrity.
The FST’s decision outlined what happened in the run-up to the hearing.
On 9 November 2023, the FST’s secretariat emailed the Tribunal record to TC. He acknowledged receipt on the same day. TC also stated that he would wait for the Tribunal to set a date for the hearing because he did not want the matter to be decided on the papers.
On 14 November, the Tribunal informed TC that the matter was set down for 11am on 19 February 2024. On the same day, he replied: “Kindly note, I will be available on the proposed date for the hearing.”
The next day, the secretariat again emailed TC. The email included confirmation that he had been sent the meeting invite and the Tribunal record. TC acknowledged receipt of this email on 23 January 2024.
Despite the abovementioned arrangements and communication, TC was not present when the hearing was due to commence at 11am on 19 February.
The secretariat made two telephone calls to TC to find out where he was. On the first attempt, his mobile phone rang without answer, and on the second attempt, his phone was switched off.
The matter was stood down until 11.22am, whereafter the Tribunal resumed the hearing in TC’s absence. The matter was struck from the roll.
Exceptional circumstances
But King Price’s team did not leave things there. They asked the Tribunal to grant costs against TC.
They said King Price had made it clear to TC that it was willing to abide by a decision taken by the Tribunal based on the papers alone; a formal hearing was unnecessary. Yet, TC insisted on a formal hearing. Therefore, it had to prepare for the hearing.
Three senior officials, including an advocate from the insurer’s legal department, arrived for the hearing on 19 February.
The FSP submitted that TC’s non-appearance was an abuse of process and a waste of time and money.
It also submitted that:
- The reconsideration application was frivolous and vexatious because TC pleaded guilty at a disciplinary hearing to all the charges of misconduct. These included that he participated in a dishonest scheme where his commission was inflated, and he benefited financially in a fraudulent manner.
- King Price complied with all the procedural requirements pertaining to TC’s debarment.
- At no stage did TC request a postponement of the hearing or explain to the FSP or the secretariat why he failed to appear.
- TC was in wilful default, and King Price demonstrated that exceptional circumstances existed to warrant the granting of a costs order against him.
Section 234(2) of the Financial Sector Regulation Act allows the Tribunal to “make an order that a party to proceedings on an application for reconsideration of a decision pay some or all of the costs reasonably and properly incurred by the other party in connection with the proceedings”, but only “in exceptional circumstances”.
The Tribunal found that King Price had made its case that exceptional circumstances existed.
It ordered TC to pay the FSP’s reasonably and properly incurred costs on a party-and-party High Court scale.
