Not upheld: not of satisfactory quality; mis-sold warranty complaint against Stellantis Financial Services UK Limited

Decision detail

Summary

Mr N purchased a used car through a conditional sale agreement with Stellantis on 1 March 2025 for £8,255, with 131,750 miles on the clock. He also purchased an extended warranty for £260. Within months, the car developed significant faults including an oil leak, suspension wear, and wheel bearing issues, with repairs estimated at over £6,000. The warranty claim was declined due to a wear and tear exclusion. Mr N complained that the car was not of satisfactory quality and the warranty was mis-sold. The ombudsman found that while defects were present at sale, they were consistent with wear and tear expected in a nearly 10-year-old vehicle of this price and mileage, and therefore the car met the satisfactory quality standard. The warranty was not mis-sold as the defects correctly fell within the wear and tear exclusion. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the Consumer Rights Act 2015 section 9 test for satisfactory quality, which requires consideration of all circumstances including price, age, and mileage. The car cost £7,995 (compared to original cost of £45,000), was nearly 10 years old, and had covered 131,750 miles at purchase. While defects were present at the point of sale, they were consistent with wear and tear expected in a vehicle of this age, price and mileage. The ombudsman found the independent inspection report's conclusion that defects were not present at inception to be inconsistent with its own finding that such issues were to be expected in a vehicle of this age and mileage. Evidence from the May 2024 health check and December 2024 MOT suggested some defects pre-dated the purchase. However, the ombudsman concluded that satisfactory quality does not mean fault-free, and the car's condition was what was reasonably to be expected. Regarding the warranty, Stellantis financed it under the conditional sale agreement, making section 75 Consumer Credit Act 1974 potentially applicable. However, the ombudsman found no breach of contract or misrepresentation as the warranty provider correctly applied the wear and tear exclusion, and the warranty would have provided some benefits such as breakdown cover.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website