The Financial Industry Complaints Service (FICS) has had to narrow its workload after a Federal Court observation on its monetary limits.

The decision in FICS v Deakin, handed down in December last year, confirmed the service’s ability to handle claims linked to the Westpoint Property Group collapse. However, the court also offered an important opinion on the way FICS applies its monetary limits.

FICS is able to handle claims of $100,000 or less. The court ruled this should not include joint investments in which the total is over the monetary limit but the average for individual investors is below it.

It also said separate investments relating to the same advisor/client relationship should not be aggregated before the limit is applied.

FICS CEO Alison Maynard says the two rulings will mean a net reduction in the number of complaints handled through the service. “On balance, we’ll be able to deal with fewer complaints, not more,” she told Sunrise Exchange News.

Among the investors now locked out from the service as a result of the court finding are 27 people with claims relating to the Westpoint collapse.

Ms Maynard says the Federal Court observations were clear and unambiguous, and the service is now looking to update its rules. It is drafting an issues paper on the changes in which it hopes to introduce a new approach to monetary limits.

If approved by the member organisations, FICS would increase the limit but still allow complaints that exceeded it the use of its dispute resolution services. Ms Maynard says FICS would only be able to award amounts up to the monetary limit, but there would still be value in the service for those with larger claims.