If your financial complaint has been rejected by your provider or the Financial Ombudsman Service (FOS), you may be wondering what steps to take next. In some cases, going to court is an option, but it is important to understand the process, costs, and potential risks before proceeding.

When Should You Consider Court Action?

Before taking legal action, you should have:

• Raised a formal complaint with the financial provider and received a final response (or waited eight weeks if they did not reply).
• Escalated the complaint to the Financial Ombudsman Service (FOS) if you were unhappy with the provider’s response.
• Received a decision from the FOS that you disagree with or believe is unfair.

The Ombudsman’s decision is legally binding only if you accept it. If you reject the decision, you still have the right to take the matter to court.

Options for Taking Legal Action

If you decide to pursue your case in court, there are different routes depending on the amount of compensation you are seeking:

1.Small Claims Court (Claims up to £10,000 in England and Wales)

For financial claims under £10,000, you can take your case to the Small Claims Court, a simpler and more affordable option for handling disputes.

Process: You submit a claim online through the Government’s Money Claim service or complete a paper form. The defendant (your financial provider) has 14 days to respond.

Costs: Fees vary depending on the claim amount but range from £35 to £455 for filing online, with some additional fees if the case goes to a hearing.

Pros:
Low Cost – This is the most affordable route for legal action if you want your case to be heard.
Low Risk – You are not obliged to pay opposing costs if you are not successful

Cons:
All Fees Deducted from your claim – You can’t claim for costs but you also can’t apply for costs, therefore all cost involved in making a claim will come out of your compensation or financial redress.

Helpful Tip: Often when claims are only slightly over £10,000, if you do not have a high level of certainty in your claim being upheld and therefore can not get insurance, it is possible to limit your claim to £10,000 to allow your claim to be heard in the Small Claims Court.

2. County Court (Larger or More Complex Claims)

If your claim is for more than £10,000, or if it is particularly complex, it may be allocated to the County Court under the Fast Track (£10,000 – £25,000) or multi-track (over £25,000) procedure.

Process: You must file a claim with the County Court, after which the defendant responds, and a judge may arrange a hearing.

Costs: Fees can be high and depend on the amount you are claiming. Legal representation may also add significant costs.

Pros:
You are able to claim for legitimate legal costs associated with your claim, meaning a much larger percentage of your compensation or redress goes to you.

Cons: If you lose, you may have to pay the other party’s legal costs.

Helpful Tip: You may qualify for insurance to cover the opposing legal costs if you lose, meaning that if you are working with a no-win no-fee solicitor like us, you can cut your financial risk.

What Happens if You Win or Lose?

If you win: The court can order the financial provider to compensate you. If they do not pay, you may need to take enforcement action.

If you lose: You may be liable for court fees and, in higher-value cases, the other party’s legal costs. (But not if you have adequate insurance in place, which a good solicitor will help you source).

Is Going to Court the Right Choice?

Taking legal action can be time-consuming, expensive, and stressful. Before pursuing this route, consider:

• Alternative Dispute Resolution – Some cases can be resolved through mediation and in the case of Financial Services Claims we have independent mediators such as The Financial Ombudsman Service (FOS) and The Pension Ombudsman (POS)
• Legal Advice – Solicitors like Claim My Loss can help assess whether your case is strong enough to win in court.
• Cost vs Compensation – If court fees and legal costs outweigh the compensation you could receive; it may not be worth proceeding.

Get Expert Help Before Going to Court

If your financial complaint has been rejected through all free channels, you do not have to handle the next steps alone. We will always pursue all viable, free avenues before encouraging you to take legal action.

At Claim My Loss, we specialise in financial claims, including mis-sold car finance, pensions, and investments. Our legal experts are committed to working on a no win, no fee basis, meaning you do not pay unless we win your case.

Before taking costly legal action, let us review your case and explore your options. Book a free 30-minute consultation today to find out how we can help.