Not upheld: Section 75 claim rejection - debtor-creditor-supplier agreement requirement not met complaint against MBNA Limited

Decision detail

Summary

Mr N complained that MBNA unfairly rejected his Section 75 claim for a faulty tap purchased by his son (an additional cardholder on Mr N's credit card account) for approximately £800 in February 2023. Mr N argued MBNA should have made clear that Section 75 protections did not apply to purchases by additional cardholders. The ombudsman found that the debtor-creditor-supplier agreement requirement for Section 75 was not met because the son, not Mr N, had the direct contractual relationship with the supplier, despite Mr N's involvement in the purchase decision and benefit from the tap. While MBNA could have explained this earlier, the ombudsman considered its offer to reimburse the independent report cost to be fair remedy and made no further award.

The Ombudsman's reasoning

For a valid Section 75 claim, a debtor-creditor-supplier agreement must exist, meaning the person liable to repay the credit card debt must have a direct contractual relationship with the supplier. Although Mr N may benefit from the tap and was involved in the purchase decision, the evidence shows the son (additional cardholder) made the purchase and had the contract with the supplier. Therefore, the DCS requirement was not met. While MBNA could have explained this earlier, reimbursing the independent report cost is fair remedy. Section 75 protections are determined by law, not account terms, and it is ultimately the consumer's responsibility to understand how legislation applies to their situation.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website