Not upheld: unfair credit relationship (Section 140A CCA), connected lender liability (Section 75 CCA), undisclosed commission complaint against Mitsubishi HC Capital UK Plc trading as Novuna Personal Finance

Decision detail

Summary

Miss J purchased a Fractional Club timeshare membership in August 2012 for £9,250 financed by the Lender. She complained that the Supplier made misrepresentations, that she could not book holidays as promised, that the Supplier went into liquidation, and that the Lender failed to disclose commission of £948.13 paid to the Supplier. The ombudsman found the misrepresentation claim was time-barred under the Limitation Act 1980 as the complaint was not made to the Lender until more than six years after the time of sale. The alleged breach of contract claim lacked sufficient evidence of actual breach. The undisclosed commission was found to be relatively low and would not have affected Miss J's decision to borrow, and the Supplier did not owe a fiduciary duty. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the Limitation Act 1980 to determine that the misrepresentation claim was time-barred as more than six years had passed since the time of sale (5 August 2012) to when the complaint was first notified to the Lender (9 August 2023). Regarding the alleged breach of contract claim concerning holiday availability, the ombudsman found insufficient evidence that the Supplier had actually breached the Purchase Agreement, noting that availability was stated to be subject to demand and Miss J provided no evidence she was no longer a member or unable to use the membership. On the commission issue, the ombudsman found the undisclosed commission of £948.13 was relatively low and would not have deterred Miss J from taking the loan, and that the Supplier did not owe Miss J a fiduciary duty as it was acting as a seller of timeshares with credit brokerage as a means to that end, not as a separate service or agent of Miss J.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website