Upheld: failure to follow contractual process; unfair treatment in device upgrade scheme complaint against Telefonica UK Limited trading as Virgin Media O2
Financial Ombudsman decision DRN-6261607 of 2026-05-07T00:00:00+00:00. failure to follow contractual process; unfair treatment in device upgrade scheme complaint against Telefonica UK Limited trading as Virgin Media O2. Outcome: Upheld.
Decision detail
| Reference | DRN-6261607 |
|---|---|
| Decision date | 2026-05-07T00:00:00+00:00 |
| Firm | Telefonica UK Limited trading as Virgin Media O2 |
| Product | mobile phone contract with credit agreement |
| Claim type | failure to follow contractual process; unfair treatment in device upgrade scheme |
| Outcome | Upheld |
| Remedy | O2 must contact Mr T and provide the two contractual choices from clause 24.3. If Mr T chooses to return the iPhone 17 Pro Max, O2 must clear the balance on the new credit agreement, refund all payments made towards it with 8% simple interest per year from the date payments were made, and remove any adverse credit file information. O2 must also pay Mr T £100 for distress and inconvenience. |
Summary
Mr T complained that O2 treated him unfairly in its Switch Up device upgrade process. After trading in his iPhone 16 Pro Max, O2 identified damage and rejected it, offering £90 instead of clearing the remaining balance on the original credit agreement. Mr T was left liable for two credit agreements. Although the ombudsman found O2's damage assessment was justified based on visible scratches, O2 failed to follow its contractual obligation to provide Mr T with the choice to return the new device within the 14-day change of mind period. The ombudsman upheld the complaint and ordered O2 to provide Mr T with the contractual choices, refund payments with interest if he returns the new device, and pay £100 for distress and inconvenience.
The Ombudsman's reasoning
While O2 was justified in rejecting the trade-in device based on visible damage, it failed to follow its contractual obligations by not providing Mr T with the explicit choice to return the new device and cancel the new contract within the 14-day change of mind period. The ombudsman found that O2's failure to communicate this option to Mr T, despite his timely complaint, constituted unfair treatment that left him liable for two credit agreements when he should have been given the opportunity to avoid this situation.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Telefonica UK Limited trading as Virgin Media O2, all decisions | 1 | 100% |
Source
Read the original decision on the Financial Ombudsman Service website