Not upheld: Unfair reapplication of charges and service failure in processing cancellation complaint against Shop Direct Finance Company Limited (SDFCL)

Decision detail

Summary

Mr M ordered headphones on a Buy-Now-Pay-Later basis and cancelled the order before the estimated delivery date. SDFCL confirmed the cancellation and refunded the £129 charge, but due to a system error, the retailer dispatched the headphones weeks later and SDFCL reapplied the charge without notice. Mr M complained that he should not be charged for headphones he had cancelled and should not have received. SDFCL acknowledged the error but required Mr M to return the headphones before reversing the charge, offering multiple free return options and paying £50 compensation. The ombudsman found SDFCL's approach fair and reasonable, as Mr M should not keep the headphones without paying for them, and the return options offered were reasonable despite Mr M's preference for a specific Sunday collection window.

The Ombudsman's reasoning

The ombudsman accepted that SDFCL should not have put Mr M in the position of receiving the headphones or having the charge reapplied. However, the fair outcome required unwinding both sides of the error—Mr M should not keep the headphones without paying for them. SDFCL offered reasonable return options at no cost to Mr M, and while Mr M's insistence on a specific Sunday collection window was understandable, it was not reasonable given the alternative free return methods available. The £50 compensation was fair given the service failures, though the ombudsman acknowledged SDFCL's errors caused unnecessary inconvenience.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website