Upheld: Goods and services under S75 complaint against Zopa Bank Limited

Decision detail

Summary

Mrs H purchased a used car under a hire purchase agreement with Zopa Bank in February 2025 for £17,094. The car had failed an MOT test in January 2025 due to engine issues and the engine warning light appeared when Mrs H drove it home. The engine failed in July 2025 after only 4,500 miles of use. Zopa Bank rejected Mrs H's complaint, stating the defect was not developing at inception. Mrs H arranged repairs costing £9,714 in September 2025, which identified multiple engine defects including a cracked intake manifold present at time of sale. The ombudsman upheld the complaint, finding the car was not of satisfactory quality when supplied and ordered Zopa Bank to reimburse repair costs, refund payments during the period the car was unusable, pay interest, remove adverse credit information, and pay £250 compensation.

The Ombudsman's reasoning

The ombudsman found on the balance of probabilities that the car had engine issues when supplied, evidenced by the failed MOT test in January 2025, the engine warning light appearing immediately upon delivery, and the engine failure within five months and 4,500 miles of use. The September 2025 inspection report identified multiple defects including a cracked intake manifold present at time of sale and lubrication failure. It is unreasonable to expect a car to require such extensive repairs after less than five months of use and only 4,500 miles. The car was not as durable as reasonably expected, making it not of satisfactory quality at supply. Mrs H acted reasonably in arranging repairs after Zopa Bank rejected her complaint.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website