Not upheld: section 75 claim and chargeback dispute regarding package holiday cancellation complaint against HSBC UK Bank Plc

Decision detail

Summary

Mr A paid £2,600 for a package holiday using his HSBC credit card but cancelled on 28 April 2023 after being unable to obtain a required VISA appointment. The booking agent charged the full amount in accordance with its contractual terms, which did not provide for refunds in Mr A's circumstances. Mr A complained to HSBC seeking a remedy under section 75 of the Consumer Credit Act 1974 and through chargeback. HSBC declined both claims. The ombudsman upheld HSBC's decision, finding that the booking agent had not breached the contract and that Mr A's circumstances did not entitle him to a refund under the booking terms or chargeback rules. The complaint was not upheld.

The Ombudsman's reasoning

Section 75 of the Consumer Credit Act 1974 provides protection where a credit card supplier is liable for breaches of contract or misrepresentation by the merchant. However, the onus is on the consumer to evidence such a breach. In this case, the booking agent did not breach the contract by charging the full amount as Mr A's cancellation due to inability to obtain a VISA did not fall within the limited circumstances entitling him to a refund under the contract terms. The booking agent acted in accordance with its contractual terms. Similarly, a chargeback claim would have been unlikely to succeed as the booking agent had provided the contracted service (the holiday was available) and Mr A's inability to obtain a VISA was not a ground covered by chargeback rules. HSBC was therefore correct to decline both the section 75 claim and would not have benefited from pursuing a chargeback.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website