Not upheld: Goods and services under S75 complaint against Mitsubishi HC Capital UK PLC trading as Novuna Personal Finance

Decision detail

Summary

Mr M financed a kitchen installation costing £24,462 through a £10,426 fixed sum loan from Novuna in 2018. The kitchen developed multiple faults including non-working lights, faulty appliances, water damage, and uneven worktops, with repairs attempted over six years proving unsuccessful. In August 2024, Mr M made a section 75 claim against Novuna seeking £85,000 in compensation. Novuna commissioned an independent expert report in 2025 which recommended complete kitchen replacement, and offered £35,000 settlement (kitchen replacement less 10% usage discount, flooring, installation, expenses, and inconvenience payment) plus £500 for delays. Mr M rejected this offer and complained about Novuna's handling of his claim. The ombudsman found Novuna acted fairly in requesting evidence, obtaining an up-to-date expert report, and making a reasonable settlement offer based on that report's recommendations, and did not require additional compensation.

The Ombudsman's reasoning

The ombudsman found that Novuna appropriately handled the section 75 claim by requesting further evidence to substantiate the breach of contract allegations, commissioning an up-to-date independent expert report, and basing its settlement offer on that expert's recommendations for complete kitchen replacement. The ombudsman considered Novuna's offer of £35,000 fair and reasonable as it covered like-for-like kitchen replacement with a reasonable 10% deduction for six years of usage, flooring replacement, installation costs, expenses, and £1,500 for inconvenience and distress. The ombudsman rejected Mr M's claim for £85,000, noting that poor customer service is not the same as breach of contract, that Mr M had benefited from six years of kitchen use, and that the 2025 report did not confirm water damage to sub-floor areas. The £500 offered for delays was considered fair given the complexity of the investigation required.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website