Partially upheld: refund claim handling; breach of contract under Section 75 Consumer Credit Act 1974 and Consumer Rights Act 2015 complaint against Bank of Scotland plc trading as Halifax
Financial Ombudsman decision DRN-6290848 of 2026-04-21T00:00:00+00:00. refund claim handling; breach of contract under Section 75 Consumer Credit Act 1974 and Consumer Rights Act 2015 complaint against Bank of Scotland plc trading as Halifax. Outcome: Partially upheld.
Decision detail
| Reference | DRN-6290848 |
|---|---|
| Decision date | 2026-04-21T00:00:00+00:00 |
| Firm | Bank of Scotland plc trading as Halifax |
| Product | credit card |
| Claim type | refund claim handling; breach of contract under Section 75 Consumer Credit Act 1974 and Consumer Rights Act 2015 |
| Outcome | Partially upheld |
| Remedy | Halifax must pay £1,434.00 compensation to Mrs P within 30 days of her accepting the decision. Halifax should first check if J's offer remains valid and facilitate payment through J. If J does not pay, Halifax is jointly liable and must ensure Mrs P receives the £1,434.00 directly. Halifax may inform J of any direct payment to avoid double recovery. |
Summary
Mrs P booked a £8,546.00 holiday using a Halifax credit card but found the accommodation fell short of expectations due to cleanliness issues, improper use of an ozone machine, building works, and defects in her upgraded Penthouse suite. Halifax did not progress her refund claim beyond the holiday supplier's offer of £1,434.00 compensation. The ombudsman found that while a chargeback was not appropriate, a Section 75 Consumer Credit Act claim revealed breaches of contract in three areas. However, the ombudsman determined that the offered £1,434.00 compensation (approximately 23% of accommodation costs) was fair and reasonable when considering the Penthouse upgrade benefits and private dining offer. Halifax was directed to ensure Mrs P receives this compensation within 30 days, with Halifax being jointly liable if the original supplier does not pay.
The Ombudsman's reasoning
The ombudsman found that while a chargeback would not have been appropriate (as the core service of accommodation was provided and issues related to quality rather than non-provision), a Section 75 Consumer Credit Act claim was more suitable. Under Section 75 and the Consumer Rights Act 2015, the ombudsman identified breaches of contract in three areas: cleanliness of the original room and Penthouse suite issues, improper use of the ozone machine in an occupied room, and inadequate management/communication of adjacent building works. However, the ombudsman found insufficient evidence for claims regarding food quality, staff conduct, and health/safety concerns. The ombudsman determined that J's offer of £1,434.00 (approximately 23% of non-flight costs) represented reasonable compensation when considered alongside the Penthouse upgrade benefits and private dining offer, fairly reflecting the loss of enjoyment from the identified breaches.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Bank of Scotland plc trading as Halifax, all decisions | 143 | 9% |
Source
Read the original decision on the Financial Ombudsman Service website