Not upheld: section 75 claim handling and time limitation complaint against Barclays Bank UK PLC trading as Barclaycard

Decision detail

Summary

Mrs R purchased spray foam insulation for a rental property in March-April 2017 using her Barclaycard credit card. In 2023, when preparing to sell the property, she discovered the spray foam was incorrectly installed and unsuitable, causing damage. She raised a section 75 claim with Barclaycard in January 2024, alleging misrepresentation and breach of contract by the supplier. Barclaycard declined the claim as it was brought outside the six-year limitation period under the Limitation Act 1980. The ombudsman upheld Barclaycard's decision, finding it fair and reasonable to apply the six-year limitation period from the date the contract was entered into (April 2017) rather than from when the defect was discovered, and finding no applicable statutory extensions to the limitation period.

The Ombudsman's reasoning

The ombudsman applied the Limitation Act 1980 six-year limitation period as the fair and reasonable standard for section 75 claims. The causes of action for both misrepresentation and breach of contract accrued in April 2017 when the contract was entered into and the installation occurred. Since Mrs R did not raise the section 75 claim until January 2024, it was brought outside the limitation period. The ombudsman considered potential extensions under sections 14A and 32 of the Limitation Act but found none applied: section 14A (negligence with unknown facts) did not apply to breach of contract claims, and section 32 (fraud, concealment, or mistake) did not apply because fraudulent misrepresentation could not be established where the supplier could not have known the statement was false at the time, and any mistake would not be essential to the cause of action. Therefore, Barclaycard's rejection was fair and reasonable.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website