Not upheld: unfair credit relationship; alleged breach of Regulation 14(3) of the Timeshare Regulations; alleged mis-selling of timeshare as investment complaint against Mitsubishi HC Capital UK PLC trading as Novuna Personal Finance

Decision detail

Summary

Mr K purchased Fractional Club timeshare membership in October 2013 for £8,719, financed by a loan from the Lender. Over 10 years later, in August 2024, Mr K complained that the Supplier breached Regulation 14(3) by marketing the membership as an investment, and that this made the credit relationship unfair under Section 140A of the Consumer Credit Act 1974. The ombudsman found that while a breach of Regulation 14(3) was possible, it was not material to Mr K's decision because the prospect of financial gain was not an important motivating factor in his purchase. The ombudsman also questioned the reliability of Mr K's testimony due to its timing and similarity to other statements from the same representative. The complaint was not upheld, and no remedy was directed.

The Ombudsman's reasoning

The ombudsman applied the principle from Plevin that regulatory breaches do not automatically create unfairness under Section 140A; such breaches must be considered in the round. The ombudsman found that causation was relevant—whether the alleged breach materially influenced Mr K's decision to purchase. The ombudsman questioned the reliability of Mr K's testimony due to its timing (after the Shawbrook judgment), similarity to other statements from the same representative, and inconsistencies with his original statement. The ombudsman concluded that Mr K's purchase was not motivated by the prospect of financial gain from the investment element, and therefore any breach of Regulation 14(3) was not material to his decision.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website