“Fair and reasonable” is a decision standard used by some ombudsmen; it is broader than asking only whether a technical legal breach can be proved.
The Financial Ombudsman Service, for example, decides what is fair and reasonable in all the circumstances and takes account of relevant law, regulation, guidance and good industry practice.
That does not mean the decision-maker can ignore law or evidence and simply choose whatever feels fair. The fairness assessment should still be reasoned and grounded in the relevant framework and facts.
Key points
- Check the exact scheme wording.
- Relevant law remains important.
- Good practice and guidance may also matter.
- Fairness is case-specific.
- Reasons should explain how the standard was applied.
Not a free-floating discretion
A fair-and-reasonable test usually exists within defined scheme rules. Cite the sources the scheme says it considers and explain how they apply to the facts.
Outcome and remedy
Fairness can affect both liability and remedy. A provider may have made an error but already offered a remedy; the decision-maker should consider whether further redress is appropriate and explain why.
Law is part of the assessment, not something to be ignored
Where an ombudsman uses a fair-and-reasonable test, relevant law and regulation remain important. The decision-maker may also consider regulator rules, codes, guidance, good industry practice and the particular circumstances. This can sometimes produce a consumer remedy even where a court-style cause of action is uncertain, but it does not justify disregarding a clear legal requirement or inventing an obligation with no identified source.
Challenge the reasoning, not the phrase itself
If you disagree with a fair-and-reasonable conclusion, identify what was missing from the assessment: an incorrect fact, omitted evidence, wrong rule, inconsistent treatment, failure to address vulnerability, or a remedy that does not follow from the findings. “I do not think this is fair” is much weaker than showing why the reasoning did not account for a material factor.
In practice
- Use law/rules/codes as inputs to fairness, not as decorative citations.
- Show practical impact and proportionality.
- Challenge an unexplained departure from relevant good practice.
What to do
A practical next-step plan
- Read the scheme test.
- Identify relevant sources.
- Apply to facts.
- Explain impact.
- State proportionate remedy.
Common traps
Things that often confuse the issue
- Treating “fair and reasonable” as permission to ignore contractual/legal rights.
- Assuming every inconvenience is unfair treatment.
Official sources
Check the rules behind this guide
These are official or primary sources for this topic. Rules, scheme terms and deadlines can change, so check the live source before relying on a formal time limit or procedure.