Not upheld: unfair credit relationship (Section 140A CCA) and section 75 connected lender liability claims complaint against Shawbrook Bank Limited

Decision detail

Summary

Mr C and Mrs C purchased a Fractional Club timeshare membership in October 2015 financed by Shawbrook Bank Limited for £17,433. They raised complaints in September 2024 alleging unfair credit relationships under Section 140A of the CCA and misrepresentation claims under Section 75. The Lender had assigned the debt to another creditor in November 2019. The ombudsman found the Section 75 claim time-barred under the Limitation Act 1980 (made 9 years after purchase, exceeding the 6-year limit) and could not consider the Section 140A claim as it must be made against the current debt owner, not the original lender. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that the Section 75 claim was time-barred because the purchase occurred in October 2015 but the claim was not made until 20 September 2024, exceeding the six-year limitation period under the Limitation Act 1980. For the Section 140A unfair relationship claim, the ombudsman could not consider it because the debt had been assigned to another creditor on 15 November 2019, and Section 140C(2a) of the CCA requires such claims to be made against the current creditor/debt owner. The ombudsman rejected arguments that assignment does not extinguish liability, noting that the CCA explicitly contemplates assignment. The ombudsman also found no persuasive evidence that the Lender failed to carry out proper affordability checks or that Mr C and Mrs C had suffered loss as a result.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website