16 September '03 - Minutes of the 32nd committee meeting of EMAG

Held at:       RAC Clubhouse, Pall Mall, London

Present:     All nine members of the EMAG committee, plus members: Sir Jeremy Lever, Stewart and Carole Simpson.
               
Apologies:   Gabrielle de Pauw

1. The Treasurer circulated the summary of financial movements to 1st September, which was signed by all the committee members present.
   
   
2. Stewart Simpson (MR P in the PO's Report) gave an account of the treatment of his complaint. This included the surprising information that it was the PO's staff that had written his complaint, from papers forwarded to them by Mr Simpson's MP. This draft was passed to Mr Simpson on Oct 31st 2001 and he immediately wrote back to his MP to point out that he had not complained that he could only move his annuity provider with a penalty. Mr Simpson knew he was not allowed to move his annuity. Notwithstanding, the report that appeared 20 months later still repeated this mistake. Unfortunately, the office of the PO never took up his offer to attend a meeting and Mr Simpson was never aware his was the only case being considered until after publication. Stewart Simpson described the contents of his formal complaint letter about the Ombudsman's Report, which he sent on July 30th, thus far with no response. Mr Simpson agreed to speak for 5 or 10 minutes at the forthcoming EMAG AGM.
   
   
3. Update on Judicial Review of the PO's report. TL reported on progress. Both the solicitors and the barrister (Andrew Macnab of Monckton Chambers) are making excellent progress. EMAG still seeks to contain the costs within the committee agreed budget, though this is under pressure due to the complexity of the issues. The quality and quantity of the research already undertaken by committee members has significantly helped. LS proposed a vote of thanks to TL, PB and AH for all their hard and valuable work.
   
   The claim contains several strong grounds. A "letter before claim" was lodged with the PO on September 11th with a request to respond by September 25th. The actual claim will be submitted before the end of September. The PO has 21 days in which to reply, suggesting that the judge will probably come to a decision on the basis of the two sides written submissions by mid-November.
   
   
4. Resolution to ratify. TL confirmed that since EMAG is unincorporated it cannot seek leave to appeal in its own name. TL and PB, both of whom had complained to the PO, are eligible to appeal on their own behalf and on behalf of EMAG. The anticipated costs are reckoned to be within EMAG's current resources. The committee agreed unanimously that this endeavour is of such importance that it should proceed, and in order to relieve TL and PB of their personal risk, the committee agreed to share the risk up to "leave to proceed" being determined.
   
   The committee voted unanimously that: "We authorise legal action seeking leave to proceed with Judicial Review of the Parliamentary Ombudsman's report, within the constraint of the outcome of costs exceeding EMAG's resources being highly unlikely, and authorise EMAG to pay all costs associated with the legal action. "
   This is an interim resolution, which should be superseded by a resolution to indemnify TL and PB to be drafted by solicitors Bindman & Partners.
   
   
5. Communication with MPs. A letter describing EMAG's rebuttal of the PO to all MPs and a paper describing the mis-management and mis-regulation of the society in the 1990s (drafted by CC, PB and CS) have been sent to MPs on the Treasury and Public Administration Select Committees. PB had met with Norman Lamb, LibDem MP, in Norwich in mid October.
   
   
6. EMAG's AGM, 28th October. Formal notice and information will be sent to all members, to be received by Oct 6th (PB, CS, CC BM). It was agreed to invite Sir Gordon Downey as guest speaker.
   
   
7. Definitive critique of the PO Report. AH is in the process of polishing his 105 page detailed paper on the Ombudsman's Report. It has formed the bedrock of the brief to counsel and has already been submitted to Lord Penrose. When finalised, it will be made available in PDF format on the EMAG website.
   
   
8. FSA and interpretation of the H of L. RA reported on progress on his analysis of the FSA's misinterpretation of the rulings of the Appeal Court and the House of Lords, particularly as regards the issue of ring-fencing. Had the FSA interpreted these rulings correctly the damaging effects of the H of L judgement could, in RA's opinion, have been mitigated by being stretched over many years, and could have prevented the disastrous effects ( e.g. on the proposed sale of ELAS) of unlimited GAR liability. RA has submitted his paper to Lord Penrose.
   
   
9. International. LS reported that there is definitely potential for challenging the PO's Report in EU courts. The costs could prospectively be less arduous than through the UK courts. It was agreed that this issue will be explored as soon as the time consuming JR application is resolved. LS was asked to speak to members at the AGM to outline the position on EC law. It was agreed that background material on the JR should be sent to sympathetic MEPs in anticipation of the possibility of taking our case to the EU.
   
   LS confirmed that the FOS has accepted that Guernsey policyholders come under their and the FSA's remit. (NB The FOS web site says also those from Dubai). FOS is responding on some categories of complaints, but not promptly on all. RA noted that the FSA has given the FOS a further time waiver to refuse consideration of any new ELAS claims on hold until November. While ELAS is sending out offers of compensation to those who bought policies in Germany, LS noted that some policyholders are preparing to submit their complaints to the German insurance regulators.
   
   
10. Any Other Business. The all policyholder "E 7" group will meet on Oct 14th and PB and TL intend to represent EMAG. Committee agreed to bear cost of LS attending on behalf of internationals.

Next Committee meeting is scheduled to take place at the National Liberal Club on 28th October, at 5.00pm in the Lloyd George Room immediately before the AGM..

Chris Carnaghan and Paul Braithwaite
18th September, 2003