Not upheld: Goods and services under S75 complaint against Clydesdale Financial Services Limited trading as Barclays Partner Finance

Decision detail

Summary

Mr H purchased Fractional Club timeshare membership in 2013 for £11,435 financed by the lender, seeking to exit his existing membership which ran until 2054. He complained that the supplier misrepresented the product as an investment in breach of Timeshare Regulations and that the lender was party to an unfair credit relationship. The ombudsman found no actionable misrepresentation under section 75, as the supplier's written statements were not factually untrue. While accepting the supplier may have breached the prohibition on marketing timeshares as investments, the ombudsman concluded this was not material to Mr H's decision, as his primary motivation was the shorter 15-year term and additional holiday accommodation, evidenced by his consistent annual usage of over 13,500 points. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found no actionable misrepresentation under section 75 because the supplier's written representations were not factually untrue. While accepting that the supplier may have breached Regulation 14(3) by marketing the product as an investment, the ombudsman concluded this was not material to Mr H's decision, as his primary motivation was obtaining a shorter membership term and additional holiday accommodation, not financial gain. The ombudsman applied the principle from case law that regulatory breaches do not automatically render a credit relationship unfair; the impact on the consumer's decision must be considered. The evidence of Mr H's extensive holiday usage and his own statement that he felt backed into a corner regarding exit options supported the conclusion that the investment element was not a motivating factor.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website