Not upheld: Section 75 Consumer Credit Act claim for misrepresentation; Section 140A unfair credit relationship; alleged irresponsible lending; alleged undisclosed commission; alleged breach of Timeshare Regulations complaint against First Holiday Finance Ltd

Decision detail

Summary

Mr K and Miss M purchased a Fractional Club timeshare membership for £17,145 on 8 November 2018, financed by a £16,645 loan from First Holiday Finance Ltd repayable over 144 months. In March 2025, they complained that the Lender was responsible for the Supplier's alleged mis-selling and sought redress under Section 75 of the Consumer Credit Act (misrepresentation) and Section 140A (unfair credit relationship). The ombudsman rejected the Section 75 claims as time-barred, being brought more than 6 years after the cause of action accrued. The ombudsman also rejected all Section 140A claims on their merits, finding insufficient evidence of misrepresentations, proper creditworthiness checks by the Lender, no evidence of unaffordability, and no commission payments that would render the credit relationship unfair. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the Limitation Act 1980, finding that Section 75 claims for misrepresentation must be brought within 6 years of the cause of action accruing (8 November 2018), and the March 2025 complaint was time-barred. For Section 140A unfair credit relationship claims, the ombudsman found insufficient persuasive evidence of the alleged misrepresentations, noting errors and lack of detail in Mr K and Miss M's recollections. The ombudsman found the Lender's creditworthiness checks were proportionate and that Mr K and Miss M appeared to have sufficient financial headroom at the time of lending. The ombudsman distinguished the case from the Supreme Court's Hopcraft/Johnson/Wrench decision, noting no commission was actually paid by the Lender to the Supplier, and the Supplier's role as credit broker was not a separate service but integral to the timeshare sale.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website