Complainant

Respondent

Anonymised Parties

A Citizen

A Financial Institution

Representatives

Self-Represented

Ms MP Guinness BL and Ms C Bruton BL instructed by Ms Katie Doyle of Mason Hayes & Curran

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Section 21 Equal Status Act, 2000

CA-00043964-001

09/05/2021

The issue in contention concerned the alleged Discrimination against the Complainant on the Age and Provision of Good/Services grounds under the Equal Status Act,2000.

The central matter in dispute was a mortgage Transfer “Switch” being considered by the Complainant.

The Complainant made an Oral Testimony supported by comprehensive written submissions. He vigorously cross examined the Respondent witnesses.

A brief summary of the evidence is set out below.

The Bank in question had widely advertised their Mortgage Switcher product. However, as the Complainant was over 70 years of age, he was discriminated against on age grounds as the Product was not available to persons over that age. He had attempted to use the On Line application system and later the independent broker Irish Mortgage Brokers. He wrote to the Bank on the 25th January 2021 to formally complain. A paper application form was received but again it precluded applicants over the age of 68 years of age. The Bank replied on the 20th April 2021 to state that as he was over the normal retirement age this was a factor that could impact negatively on his ability to make repayments This was a factor that the Bank needed to take into account in its Credit Risk policy.

The impact of this Age limitation policy was that the Complainant was precluded from having any application considered on “Normal” grounds such as value of property, loan to income ratio etc.

In the written submissions the Complainant pointed out that the Bank was in breach of the Consumer Protection Code 2012 in their refusal to carry out an individual assessment of his application. The Code does not have an age exclusion. Likewise, the Bank is at fault as regards the Central Bank of Ireland Mortgage Macro Prudential Rule (MMPR) which again has no age restriction, and the rules should apply to all customers regardless of age. The Bank has an obligation to evaluate all customers fairy and reasonably rather than relying on generalisations, untested assumptions and age stereotypes.

In further correspondence the Complainant stated that, as regards Section 5 (2)(d) of the Equal Status Act, 2000 the Respondent Bank had not produced any proper actuarial, statistical, or direct empirical evidence to support their case.

Furthermore, the Respondent had produced, in support of their case, an ESRI Paper on Income Retirement Ratios.  The Complainant queried much of the statistical basis of the ESRI report but also cited the conclusion that a “Single rate replacement test is unlikely to capture the multiplicity of circumstances which pensions policy must address.”   In Oral testimony the Complainant alleged that the Bank was trying to use “One Size Fits all” Age policy which was clearly inappropriate.

The Complainant referred to the precedent cases of Ross v Royal and Sun Alliance Insurance PLC (Dec-2003-116) in support of his case that the Bank was not properly applying Section 5 (2)(d) of the Equal Status Act. Likewise, in the ECJ Palacios (2007) case, the Irish High Court Donnellan case and LCR EDA 233 the clear policy was set out that any age discrimination has to be “objectively justified, necessary and proportionate.”. The Bank had not met these standards in their treatment of his case.

The Respondent Bank had not acted objectively or proportionately in their dealings with the Complainant and could not now rely on Section 5 (2)(d) as a legitimate defence to their refusal to provide him with an assessment of his “Switch” inquiry.

In summary it was a clear case, contrary to the Equal Status Act ,2002, of Age Discrimination and Refusal to Provide a Service.

The Respondent gave an oral testimony from a number of Managers and was represented jointly by Ms C Bruton BL and by Ms MP Guinness BL. Extensive Written Submissions were provided.

The Respondent made four principal arguments.

Firstly, that the complaint was mis founded as the Complainant had never actually applied for either a Financial Assessment or indeed a Mortgage. In an analogy used in the verbal arguments the Complainant may have “stood in front of the shop but had never entered” so any arguments about a Refusal of Service was completely hypothetical. The Bank had offered a paper-based Application on the 23rd February with details of specific contacts to assist and manage his application. It followed that no Discrimination could have taken place as no application or required assessment had ever taken place.

Secondly and referring to Section 5(2)(d) the Respondent explained in detail their Credit Criteria and Credit Requirements Policies. In the Credit Criteria put into evidence there are 26 sub elements which a Bank Official has to evaluate a loan against. In the Credit Requirements there are 13 Requirements one of which is Age.  The Bank Official has discretion to still approve a loan provided a supporting justification and a risk assessment is put forward by the Bank’s Credit Underwriter. There is no basis to conclude that Discrimination took place as the Complainant never actually initiated a formal application on which the Underwriters could form an opinion. Even if an application had been received the Bank were confident that Section 5(2)(d) was in their favour.

It was acknowledged that in the Paper Application Pack there was a reference to “maximum age at completion of loan is 68 years” Section A (4) and Maximum Duration “Switcher to a maximum age of 68 years). However, these were guidelines and the Bank had invited in their letter of the 23rd February 2021 the Complainant

“We have attached for your convenience the relevant (paper) mortgage application form for completion.  This will be required to be returned to the Bank as well as corroborative details to complete as assessment your application. For ease of reference, you can return this application to the undersigned, and we can acknowledge receipt for you.”

As this Application was never received the Bank was not in a position to evaluate key details as to property value, income basis of the Complainant, loan to Value ratio etc.

The Respondent stated that the Underwriters could have recommended an exception to the Age criteria which could have been approved in line with the Respondent’s Credit Delegation Authority.

Thirdly the Complainant has no standing to bring his complaint if it is based on reference to the Banks’ Published Terms of Business. This was deemed to be an “Advertisement”.  Sections 12(3) and 21(1) of the Equal Status Act 2000 exclusively reserves complaints against Advertisements to the Irish Human Rights and Equality Commission and not an individual citizen such as the Complainant.

Fourthly the Respondent Bank can rely on Section 14 (1) of the Equal Status Act ,2000 as their actions were “required by or under (i) any enactment or order of a Court” The Bank was always complying with Central Bank Guidelines which are under pinned by Legislation - Section 117 of the Central Bank Act, 1989.

In Oral Testimony the Respondents pointed to considerable supporting documentation, the Consumer Protection Code 2012, an ESRI paper of 2019 – Vol 50 No 3 which considered “Estimating and Interpreting, Retirement income Replacement Rates” and oral testimony from Bank Officials regarding the experience of the Bank in situations of mortgage Difficulties of older customers. The Respondent used these materials to illustrate the multi faced issues involved in evaluating Credit Risk where mortgage lending to mature customer was being considered.

In cross examination from the Complainant, he challenged the alleged “preconceived” statistical assumptions of most of these supporting documents. He queried the track record of the Respondent Bank in Mortgage Lending in the last Decade. It was certainly “far from perfect” in his view.

In conclusion, both from oral and Written materials the Respondent essentially maintained that mortgage Lending was a muti faced exercise in which Age was certainly a consideration but only one of a multiplicity of factors. It certainly was not an overriding determinant.

Notwithstanding the provisions of Section 5 and 14 of the Act of 2000, relied upon by the Respondent in rebuttal, the key factor was that Complainant had been invited on the 23rd February 2021 to make an application where his entire case could have been considered. He had never done this so Discrimination against him was only an unproven negative assumption of his part.

This did not meet the necessary standards of proof required by the Equal Status Act, 2000 and the complaint was accordingly Not Well Founded.

3:1        Introduction and preliminary Adjudication Overview

This case was contested over a number of Oral hearings and was characterised by extensive written materials submitted in support of arguments. Evidence by way of Oral Testimony was given under sworn Oath or Affirmation.

The Adjudication Officer, having reviewed all the materials carefully, was left with one key question that formed a key  basis of the Adjudication Decision, namely did Discrimination as defined in the Equal Status Act,2000 actually take place and again under the Equal Status Act,2000 were Goods or Services not provided in a proper fashion.

Discrimination is defined in the Equal Status Act,2000 as

Discrimination (general).

3.—(1) For the purposes of this Act discrimination shall be taken to occur—

(a) where a person is treated less favourably than another person is, has been or would be treated in a comparable situation on any of the grounds specified in subsection (2) or, if appropriate, subsection (3B), (in this Act referred to as the ‘discriminatory grounds’) which—

(i) exists,

(ii) existed but no longer exists,

(iii) may exist in the future, or

(iv) is imputed to the person concerned,

(b) where a person who is associated with another person—

(i) is treated, by virtue of that association, less favourably than a person who is not so associated is, has been or would be treated in a comparable situation, and

(ii) similar treatment of that other person on any of the discriminatory grounds would, by virtue of paragraph (a), constitute discrimination,

or

(c) where an apparently neutral provision would put a person referred to in any paragraph of section 3(2) at a particular disadvantage compared with other persons, unless the provision is objectively justified by a legitimate aim and the means of achieving that aim are appropriate and necessary.

(2) As between any two persons, the discriminatory grounds (and the descriptions of those grounds for the purposes of this Act) are:

-----

(f) subject to subsection (3), that they are of different ages (the “age ground”),

Considerable precedent case law was cited by both sides to support their arguments.

None the less, legal precedents considered, the evidential facts are central and in particular the correspondences between the Parties in early 2021.

3:2     Consideration of the Evidence presented and in particular the exchanges of correspondence between the Parties.

On the 25th of January 2021 the Complainants wrote to the Respondent stating that

“We write to complain that we are unable to apply to switch our existing mortgage with another lender to your bank because we are outside your discriminatory terms of business and lending practices which set a max age for applicants of 65 years & in addition set a max age for repayments of 70 years of age.”

The Complainant confirmed that he was over 70 years of age.

The Respondent Bank replied on the 23rd February 2021 requesting details of any application that the Complainant had submitted. The Bank continued

“X bank would be happy to review an application from you in line with our credit criteria upon submission.

We have attached for your convenience the relevant mortgage application form for completion, this will be required to be returned to the Bank as well as corroborative materials to complete an assessment of your application. For ease of reference, you can return this application to the undersigned, and we can acknowledge receipt for you”.

It would appear from the evidence that no application was ever received by the Bank.

The Complainant replied on the 15th  March 2021 to state that

“We are not complaining that Bank have not properly considered a specific application for your mortgage switching product but that we are precluded from making such an application on the grounds of age as a result of your terms of business. In that regard I would refer you to your online Mortgage Credit Directive – General information for Mortgage customers”.

On this basis it was assumed, from the Oral testimony, by the Adjudicator, that no application was made to the Bank.

The Bank replied further on the 20th April 2021 to note that No Application had been received and continued

“The decision to make the term of this product available to a maximum age emanates from an evaluation of suitability of this product for customers and credit risk from the bank’s perspective having regard to underwriting and commercial factors”.

Matters then proceeded to the WRC on the 9th May 2021.

The key Adjudication issue then becomes the issue of the Application or Assessment that never took place. In the Complainant’s favour is the clearly stated Age issue (68 years) in the Bank’s published documents as opposed to the Bank’s evidence that all applications are considered against a wide range of factors on a Credit and Underwriting basis which could never happen in the absence of any application with “corroborative” in the Banks language, financial details.

Two competing assumptions are now at play – the Complainant’s based on the published terms of business with an age 68 reference and the Bank’s assumption that as no Application was ever received none of the normal Bank routines could have taken place to evaluate a loan application.

A complicating factor is now Section 12 and Section 23 of the Equal Status Act,2000 and alleged discriminatory advertising.

The Terms of Business of the Bank would have to be accepted as “an advertisement” of their Services. Legal precedent especially as set out in the comprehensive case Adj – 00021417 Tenant v a Landlord make the point that a Complainant has to establish that a complained of Advertisement was directed “solely at them”. This is clearly not the case here. The Terms of Business was a generic document.

A somewhat lengthy quote from Adj 21417 is apt at this point

“Complaint under Section 12(1) Prohibited Advertising

12-(1) A person shall not publish or display or cause to be published or displayed an advertisement which indicates an intention to engage in prohibited conduct or might reasonably be understood as indicating such an intention.

And

(3) In subsection (1) “advertisement” includes every form of advertisement, whether public or not and whether in a newspaper or other publication, on television or radio or by display of a notice or by any other means, and references to the publishing or display of advertisements shall be construed accordingly.

The complaint under this section of the Act raises a number of issues which are explored in these findings.

Firstly, is the question of whether there was an advertisement. In accepting the evidence of the Complainant that she was required by the Respondent to source a tenant which did not offend his definition of suitable tenants and which definition is found to be racist in nature, she did not comply with his wishes and by extension, no advertisement of a racist or discriminatory character occurred, as a matter of fact. This conclusion is such that it could be found to be the end of the matter. However, I have decided to address other issues raised by the complaint as these indicate clearly that even if it were accepted there was some form of advertisement, there other reasons why the complaint is not well founded.

The second aspect is the question of effect which would be necessary for a successful complaint under Section 12(1). In applying for a complaint to be considered well founded by the Workplace Relations Commission under Section 12(1) it would be necessary for a Complainant to demonstrate that the advertisement (prohibited conduct) ‘was directed against him or her’. It is clear from the facts of this case that any discriminatory advertising for a new tenant which the Complainant was asked to cooperate with, even if she had complied with that request was not ‘directed at her.’

The third and general aspect raised by this complaint is the question of who has locus standi to bring a complaint under Section 21(1) of the Act in respect of an advertisement. While Section 12(1) allows a person who claims that prohibited conduct has been directed against him, may seek redress by referring a case to the Director of the Workplace Relations, given that an advertisement by its very nature is something that is publicised to more than one person, it is difficult to imagine any circumstances where one Complainant could claim that an advertisement could be ‘directed against him or her’ which terminology implies a level of exclusivity of intent in the prohibited conduct. It follows from this conclusion that while the Act of 2000, as amended, allows for complaints of prohibited conduct under section 12(1) to be made to the WRC, it is the provisions of Sections 23(1) which specifically provide for the making of complaints regarding advertising and as such, is to be interpreted as reserving the right to make complaints about advertising to the IHREC, except possibly in the most exceptional and restricted circumstances concerning an individual Complainant which frankly, are hard to envisage when it subject matter is an advertisement.

Section 23(1):

Where it appears to the Authority that:

(a)    Prohibited conduct-……….

Or

(b)    A person has contravened or is contravening section 12(1) or 19 or regulations made under section 17 or 18,

The matter may be referred by the Authority to the [Director of the Workplace Relations Commission]

The right of the Authority to make such complaints was transferred to the IHREC under the Irish Human Rights and Equality Act 2014 and therefore the title of that body should be read as substituting for the Authority.

The Complainant in this case did not have locus standi to bring this complaint under the Equal Status Act 2000.”

Accordingly, and following clear legal precedents set out in the extract the Complainant is this case does not have grounds to base his complaint on the Terms of Business of the Bank. This rationale, alleged prohibition in the Terms of Business, was advanced as his reason for not actually accepting the offer, made by the Bank in February 2021, to actually submit an Application.

The issue of non-submission of an actual Application as invited by the Bank in February can be considered against precedent in George McLoughlin v Permanent TSB – ADJ -00032663 where a loan application was withdrawn and no cause for concern was found against the Bank. This case was cited by the Respondent as was Walsh v Allied Irish Bank ADJ -0000023225 where the Complainant “never sought the support services of the Bank”.

In considering the complaint the Adjudicator has to be conscious of the principle established by the Labour Court in Graham Anthony & Co Ltd v Mary Margetts EDA 038.

The Court cautioned against an almost automatic acceptance of Discrimination claims where the Complainant “falls within one of the Discriminatory grounds”. In this case the Complainants were without doubt over 70 years of age and claiming on the Age grounds. However, the Labour Court stated that “other facts needed to be adduced” to support a complaint.

Reacting to an Advertisement i.e., the Published Terms of Business, which seems to be discriminatory against your Group or Category simply because you are part of that, in this case Age Cohort, does not in itself properly found a complaint.

A further issue was the Rebuttal arguments advanced as supplement to the Non-Application defence above, by the Respondents based on Section 5(2) (d) of the Equal status Act 200o.

Disposal of goods and provision of services.

5.—(1) A person shall not discriminate in disposing of goods to the public generally or a section of the public or in providing a service, whether the disposal or provision is for consideration or otherwise and whether the service provided can be availed of only by a section of the public.

(2) Subject to subsections (4) and (4A), subsection (1) shall not apply in respect of

(d) differences in the treatment of persons in relation to annuities, pensions, insurance policies or any other matters related to the assessment of risk (other than on the gender ground or in any other circumstances to which the Gender Goods and Services Directive is relevant)] where the treatment—

(i) is effected by reference to—

(I) actuarial or statistical data obtained from a source on which it is reasonable to rely, or

(II) other relevant underwriting or commercial factors,

and

(ii) is reasonable having regard to the data or other relevant factors,

(Underlining by the Adjudication officer.)

Substantial written materials from reputable Financial and Consulting Authorities, supported by sworn Oral Evidence from the Bank was advanced to support the Financial and Actuarial basis of their Policies regarding Mortgage Applications. The Complainant queried the statistical basis of most of these supporting arguments. However, on the Balance of Probabilities and the Sworn evidence of the witnesses, who were cautioned as regards Perjury, the Rebuttal based on Section 5(2)(d) has to be allowed stand in the Bank’s favour.

3:3        Summary Conclusions

In summary the Adjudication conclusions have to be that

No Application was ever received by the Bank despite an invitation to do so by letter of the 25th February 2021 with a reassurance that it would be received by a named Officer. Without an Application actually being made the Respondent view that any discrimination could not physically have taken place has to have standing.  The Complainant’s view that it, Discrimination, would have taken place, is at best an assumption that had to be considered conjectural. On considered balance the Adjudication view has to be with the Respondent

The Act precludes individuals, save in most exception circumstances, basing a Discrimination claim on the basis of an “Advertisement” in this case the published Terms of Business. This has to apply in this case.

The Provisions of Section 5(2)(d) regarding Actuarial or Statistical data apply – on the balance of probabilities - in the Respondent’s favour.

Age Discrimination. Provision of Goods and Services, Requirement to establish that a prohibited act actually physically took place.