Partially upheld: Goods and services under S75 complaint against Mallard Leasing Limited

Decision detail

Summary

Mr C purchased a used 2015 van through a hire purchase agreement with Mallard Finance in December 2023 for £10,000. He experienced starting problems and engine management issues early on, which were addressed through repairs including engine remapping and glow plug replacement. In March 2024, the engine failed due to oil starvation. Two independent engineer reports disagreed on whether the damage occurred before or after Mr C's ownership. The ombudsman found the damage occurred during Mr C's ownership due to poor maintenance, not a pre-existing fault, based on the van's ability to travel 4,000 miles without early oil-related symptoms and the lack of oil problems identified by multiple garages. The complaint was partially upheld, awarding £200 compensation for the early problems but rejecting liability for the engine failure.

The Ombudsman's reasoning

The ombudsman applied the Consumer Rights Act 2015 standard of 'satisfactory quality', considering the van's age (8.5 years), mileage (145,000 miles), and price (£10,000). While a reasonable person would expect some wear on such a vehicle, it should still be reasonably durable. The ombudsman found that the early problems (starting issues, glow plugs) were separate from the later engine failure. Crucially, the ombudsman determined the engine damage from oil starvation occurred during Mr C's ownership because: (1) no significant engine problems were reported early on; (2) the van was not serviced when due; (3) multiple garages found no oil problems; and (4) Mr C drove the van approximately 4,000 miles before failure. If the damage had been present or developing at sale, the van would not have been drivable for this distance. Therefore, the engine failure resulted from poor maintenance during Mr C's ownership, not a pre-existing fault.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website