Because of a mistake made on Reginald and his late wife's mortgage agreement, Reginald had to work in order to pay back the loan, resulting in spinal surgery. After seven years, the mistake was found and rectified, but we felt the bank hadn't properly considered the full physical, mental and financial toll on Reginald.
What happened
Reginald and his late wife took out a joint mortgage. Sadly, his wife passed away a few years after taking out the mortgage. But Reginald remembered his wife telling him the mortgage was protected. Not long after she died, Reginald says he went into his bank (who provided his mortgage) to ask about the life insurance policy he and his wife had taken out to protect the lending. But the bank said that it had no record of any policy that contained life cover, just a PPI policy. It said that Reginald must have been mistaken.
Reginald says he felt vulnerable, having just lost his wife, and didn’t have anything to challenge what the bank said. This led him to believe that the mortgage wasn’t covered. He was worried about paying the loan as he hadn’t worked for many years and his wife had been the sole earner in the family. His only income was benefits and this wasn’t enough to cover the mortgage. He was very worried about losing his home. He looked into downsizing his property. This wasn’t possible as he couldn’t get lending elsewhere based on his low income. The bank agreed a reduced rate for his mortgage, but this meant that the loan wouldn’t be fully paid off by the end of the term.
As there was still more than nine years left to pay the mortgage, he looked for a job but the only work he could find was as a cleaner in a school. Unfortunately, Reginald suffered from a spinal condition that affected his mobility. This was exacerbated by the manual work he was now doing. It led to a need for surgery on two occasions, as well as lasting damage to his hip. He continued working for many years and past his retirement age as he needed to keep up with the mortgage repayments.
Reginald says after nine years his health was such that he didn’t think that he could carry on working any more. The loan term was coming to an end and he had no means of paying back the outstanding amount. So, he contacted his bank to discuss his options.
It was at this point it was realised that his wife did request life cover after all, and the cost had been factored into their payments – but the bank had failed to record the life cover element of the policy when it set it up with its in-house insurers. The bank accepted it made an error when setting up the policy and, belatedly, paid the claim – which led to the full mortgage being repaid. It also left a credit on the account, which was paid to Reginald and all of the payments he made over the years were refunded to him with interest.
It also paid £1,000 compensation for the distress and inconvenience it had caused him. Reginald didn’t think this compensation was enough considering all the emotional, mental and physical suffering he’d been through. He felt he had lost those years where his life could have taken a different turn and he felt he had been cheated out of that time and what he could have done with it.
What we said
We noted that it wasn’t disputed that the bank was at fault here. This had extreme consequences for Reginald. But for the mistake, his mortgage would have been paid off – and Reginald wouldn’t have needed to return to work at all. We did think the bank had paid the right amount of compensation for Reginald’s financial losses. But we didn’t think it had fully appreciated the extent to which the mistake had impacted virtually every aspect of his life, for many years.
Reginald’s return to work caused him pain and suffering because of his spinal condition. The return to work wasn’t the cause of Reginald’s spinal condition. But, having considered the medical evidence he provided, we were satisfied that the nature of the work he did caused him pain because of the condition he already had. Having to work aggravated his condition and significantly contributed to the long-term pain and suffering it caused him.
We were also satisfied that Reginald was caused distress and inconvenience both by the failure to pay the claim, and the consequences of that failure in his enforced return to the workplace. At a time when he’d just lost his wife, he was told he’d have to continue paying the mortgage. As a result, he says he had to choose between losing his home and returning to the workplace – while still grieving for his wife. We recognised that he only started working because he needed to do so to stay in his home. We accepted the work options open to him were limited and understood why he felt manual work of some kind was his only option. He also had the continuing worry of losing his home for nearly a decade and thought that point had been reached when he couldn’t work any longer. The worsening of his health was hastened, which also contributed to his distress.
Taking into account the nature of what Reginald experienced, the impact it had on him and the fact that it went on for nine years, we decided that it was appropriate to make an award for his pain and suffering, as well as for the distress and inconvenience he experienced. Together the total compensation was £10,000.