Not upheld: unfair credit relationship under Section 140A of the Consumer Credit Act 1974; rejection of Section 75 claim; alleged breach of Regulation 14(3) of the Timeshare, Holiday Products, Resale and Exchange Contracts Regulations 2010 complaint against Shawbrook Bank Limited

Decision detail

Summary

Mrs C and Mr S purchased a Fractional Club timeshare membership for £10,338 in May 2017, financed through a credit agreement with Shawbrook Bank Limited. The membership included an asset-backed element offering a share in an Allocated Property's net sale proceeds. In September 2023, they complained that the lender participated in an unfair credit relationship and wrongly rejected their Section 75 misrepresentation claim. The ombudsman found that while the Supplier may have breached Regulation 14(3) by marketing the product as an investment, this breach was not material to their purchasing decision, as their testimony did not identify the investment element as a motivating factor. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman acknowledged that the Supplier may have breached Regulation 14(3) by marketing the Fractional Club as an investment, but concluded that even if such a breach occurred, it was not material to Mrs C and Mr S's purchasing decision. The ombudsman found that the investment element (share in the Allocated Property) was not mentioned by Mr S as a motivating factor in his testimony, and therefore any breach of the regulation would not have rendered the credit relationship unfair. The ombudsman also agreed with the Investigator that the Section 75 claim was made more than six years after the events concerned.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website