Not upheld: unfair credit relationship under Section 140A CCA; Section 75 CCA claim; alleged breach of Regulation 14(3) Timeshare Regulations; irresponsible lending; unfair contract terms complaint against First Holiday Finance Ltd

Decision detail

Summary

Mr B purchased a Fractional Club timeshare membership in February 2019 for £19,522, financed by a £19,022 loan from First Holiday Finance Ltd. He complained that the Supplier breached Regulation 14(3) of the Timeshare Regulations by marketing the product as an investment, and that the Lender was party to an unfair credit relationship and should pay a Section 75 claim. The ombudsman rejected all grounds, finding insufficient evidence that Mr B was motivated by investment returns despite acknowledging a possible regulatory breach. The ombudsman gave limited weight to Mr B's statement provided six years after purchase and found the lending was affordable as Mr B made payments until 2025.

The Ombudsman's reasoning

The ombudsman applied Section 140A of the CCA and Section 75 analysis, considering whether the credit relationship was unfair and whether there was actionable misrepresentation. While acknowledging it was possible the Supplier breached Regulation 14(3) by marketing the product as an investment, the ombudsman found insufficient evidence that this breach rendered the credit relationship unfair. The ombudsman gave limited weight to Mr B's statement provided six years after purchase, noting memory fade and the risk that recollections were coloured by subsequent case law (Shawbrook & BPF v FOS). The ombudsman found no evidence in contemporaneous documentation that Mr B was motivated by investment returns, and found the lending was affordable as Mr B made payments until 2025.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website