Not upheld: unfair credit relationship under Section 140A of the Consumer Credit Act 1974; Section 75 claim for misrepresentation and breach of contract; alleged irresponsible lending; alleged undisclosed commission complaint against Shawbrook Bank Limited

Decision detail

Summary

Mr and Mrs H purchased a Fractional Club timeshare membership in March 2013 for £11,880 financed by an interest-free loan from Shawbrook Bank. They complained in March 2018 alleging misrepresentation, breach of contract, unfair credit relationship, and irresponsible lending. The ombudsman found insufficient evidence for alleged misrepresentations about exclusive membership or guaranteed end dates, and rejected the allegation that the product was marketed as an investment because it was not mentioned in the original complaint, Mr and Mrs H signed a declaration stating it was not an investment, and the witness statement supporting this claim had questionable provenance and lacked specificity. The ombudsman also found no evidence the loan was unaffordable and noted no commission was paid by the Lender. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found insufficient persuasive evidence for the alleged misrepresentations regarding exclusive membership, guaranteed end date, or that purchasing was the only way to exit existing membership. The alleged breach of contract regarding the Allocated Property was a future and uncertain event. The ombudsman rejected the investment marketing allegation because: (1) it was not mentioned in the original complaint made 5 years after purchase; (2) Mr and Mrs H signed a declaration stating the product was not an investment; (3) the witness statement had questionable provenance and lacked specificity; and (4) the statement did not demonstrate an expectation of financial gain. No commission was paid, distinguishing this from the Supreme Court's Hopcraft decision. The ombudsman found no evidence the loan was unaffordable and noted both agreements contained cooling-off periods.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website