A woman is seeking hundreds of thousands of pounds compensation from Barclays, claiming the bank’s will-writing service resulted in her losing a stake in a valuable London home.
Barclays is contesting the claim.
But, in an interesting twist, Telegraph Money can reveal that when the complaint was previously assessed by the Financial Ombudsman Service (FOS), the bank was found at fault. The Ombudsman ordered Barclays to pay “a fair and reasonable settlement”.
Unusually, Barclays decided to ignore the Financial Ombudsman’s recommendation.
The matter has now gone to the High Court.
Court documents detail how in 2007 Ebenezer Aregbesola used Barclays’ £90 will-writing service to create a will dealing with his various assets including homes overseas and in London. His will instructed half of the London home to be given to his daughter, Tinuola Aregbesola, on his death.
The property was owned jointly by Mr Aregbesola and his wife – who was not Tinuola’s mother. Because of the joint ownership, on Mr Aregbesola’s death in early 2014, the property went wholly to his wife – in contravention of the wishes spelt out in the will.
In order for the will’s conditions to have been fulfilled, Barclays should have severed the joint tenancy agreement, the court document alleges. This would have enabled half of the property’s value to pass as instructed to his daughter. Because this severance process – which the Ombudsman describes as “a simple formality” – was neglected, the joint tenant, Mr Aregbesola’s widow, is legally entitled to the whole property which she can now bequeath as she pleases.
The case highlights the danger of popular, cheap “DIY” wills which are often too simplistic to reflect accurately their owner’s wishes.
In summing up the case the Ombudsman concluded: “The half-share in the property in London cannot be gifted to Miss Aregbesola in accordance with the late Mr Aregbesola’s wishes.
“There is no subsequent right for this to be contested with the co-owner in a court of law. Had the bank referred Mr Aregbesola’s will instruction form to its solicitors I am aware [the solicitors would] issue the notice of severance as a matter of good practise.
“In order to resolve the complaint we would usually ask the bank to put the consumer back in the position they would have been had the correct steps had been taken in the first instance.
“Unfortunately, the share in the property in Balham is incapable of being gifted now. Therefore, I would ask Barclays to come up with a settlement that would fairly and reasonably resolve the complaint – taking into consideration the value of the property and the intended gift.”
But once it received this recommendation Barclays shifted position. It said that since its will-writing division was not regulated, it would not have to adhere to the Ombudsman’s findings. The Ombudsman accepted this was technically correct.
In an emailed statement “The matters raised are the subject of ongoing legal proceedings. It would not be appropriate to comment on the specific points raised. We note that the Financial Ombudsman Service issued its latest decision in relation to the complaint raised by Ms Aregbesola on 19 February 2015. The Financial Ombudsman Service concluded that the matter was outside of the scope of its service.“
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