Not upheld: section 75 claim - alleged misrepresentation and breach of contract in supply of spray foam insulation service complaint against Ikano Bank AB (publ)

Decision detail

Summary

Mr F complained to Ikano about a section 75 claim relating to spray foam insulation installed in his loft in March 2020. He alleged misrepresentation regarding mortgage lending implications and breach of contract regarding installation quality. Ikano declined the claim, stating no evidence of misrepresentation and questioning the independence of the removal company's report provided as evidence. The ombudsman found no evidence that mortgage lenders commonly refused lending due to spray foam in 2020, and found Ikano's concerns about report independence reasonable despite their unclear initial communication about report requirements. The complaint was not upheld, with the ombudsman deeming the £100 compensation already paid for service issues to be fair.

The Ombudsman's reasoning

The ombudsman found no evidence that at the time of sale in early 2020, mortgage lenders commonly refused lending due to spray foam presence, so C had no duty to discuss this. Regarding the installation quality claim, while Ikano's communication was unclear about report requirements, the ombudsman found it reasonable for Ikano to question the independence of J's report given that J profited from recommending removal. The ombudsman concluded that even with Ikano's communication failings, there were no grounds to uphold the section 75 claim, and the compensation offered (£100 total) was fair for the service issues.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website