Not upheld: unsatisfactory quality of goods supplied under conditional sale agreement; dispute over refund of part exchange value and negative equity payment complaint against MONEYBARN NO.1 LIMITED (trading as Moneybarn)

Decision detail

Summary

Mr M purchased a used car under a conditional sale agreement with Moneybarn in May 2025 for £8,437. Shortly after supply, the car developed an oil leak and timing chain problems. Moneybarn agreed Mr M could reject the car and refunded his instalments, diagnostic costs, insurance costs, and paid £200 for distress and inconvenience. Mr M also sought refund of a £15,500 part exchange value and £1,133.76 negative equity payment from his previous car, arguing these were part of the same transaction. The ombudsman found that these funds were used to settle Mr M's separate prior finance agreement with another lender and were never received by Moneybarn, so Mr M had already benefited from them. The complaint was not upheld as Moneybarn had done enough to put things right.

The Ombudsman's reasoning

The ombudsman found that while the car was undisputedly of unsatisfactory quality and Mr M was entitled to reject it, Moneybarn had adequately remedied the situation by unwinding the agreement, refunding monthly payments, refunding incidental costs, and paying £200 for distress and inconvenience. Regarding the part exchange and negative equity, the ombudsman determined these funds were used to settle a separate and unrelated prior finance agreement with another lender, not received by Moneybarn, and therefore Mr M had already benefited from them. The ombudsman concluded these costs were not incurred as a result of Moneybarn supplying an unsatisfactory car, and Moneybarn bore no responsibility for them.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website