Court upholds dismissal of ÖBÍ case over Reykjavík assistance funding

Iceland’s Court of Appeal has upheld the dismissal of a case brought by ÖBÍ, a rights organisation, against Reykjavík over funding for user-directed personal assistance. The ruling does not decide whether the city breached its funding obligations, mbl.is reported.

ÖBÍ had asked the courts to recognise that Reykjavík broke the law when it approved its 2026 budget without providing funding for approved applications for the service that were still awaiting support. The Court of Appeal found that the organisation’s claim did not meet legal requirements for civil proceedings.

The case concerned 42 approved applications awaiting the start of services when the budget was considered: 29 new applications and 13 requests for additional hours. The city’s budget did not provide funding for them. Reykjavík later said it had allocated three new personal assistance agreements in May 2026 by shifting work within its approved budget framework.

ÖBÍ argued that municipalities must fund services they are legally required to provide, and that a finding against Reykjavík could have practical significance for people waiting for assistance and provide a basis for compensation claims. The city sought dismissal, arguing in part that the legal effects of the claim were unclear.

The Court of Appeal said that even if ÖBÍ’s claim were accepted, the dispute over the rights in question would remain unresolved, including the scope of the city’s payment obligations. It also found the claim was not sufficiently specific under the law. The court upheld a district court ruling from September 23 dismissing the case and ordered ÖBÍ to pay Reykjavík 300,000 kronur in appeal costs.