Not upheld: Section 75 Consumer Credit Act claim - alleged breach of contract (failure to perform service with reasonable care and skill) complaint against Marks and Spencer Financial Services Plc

Decision detail

Summary

Mrs R purchased a used car in 2018 that developed engine problems. In September 2022, she paid £1,800 to garage P for a partial repair using an MSFS credit card, despite being warned the work wasn't guaranteed. The car broke down again in December 2023 after approximately 15 months and 16,000 miles. Mrs R obtained an independent inspection report in September 2024 concluding the repair failed prematurely and claimed £1,800 plus over £10,000 in consequential losses under Section 75 CCA. MSFS rejected the claim but offered £1,800 as a goodwill gesture. The ombudsman found MSFS's handling was fair, as the independent report did not definitively establish a breach of contract, Mrs R had prior knowledge of the repair risks, and consequential losses were not recoverable given her awareness of potential problems and failure to mitigate losses.

The Ombudsman's reasoning

The ombudsman found that while J's report concluded the repair failed prematurely, it did not definitively establish that P failed to complete the work with reasonable care and skill. The ombudsman considered the broader context: Mrs R was aware the repair wasn't guaranteed and that further problems might occur; the car had pre-existing engine issues; Mrs R had chosen the cheapest option due to financial constraints; and the repair did function for approximately 15 months and 16,000 miles. The ombudsman noted inconsistencies in Mrs R's accounts over time and that MSFS had valid concerns about the evidence, including the timing of the inspection (9 months after breakdown), lack of access to previous inspections, and the car being destroyed before MSFS could conduct its own investigation. Regarding consequential losses, the ombudsman found these did not directly flow from a breach of contract given Mrs R's prior knowledge of the risks, and that Mrs R could have taken steps to mitigate losses such as storing the car or declaring it SORN. The ombudsman concluded MSFS's offer to refund £1,800 as a goodwill gesture was fair and reasonable.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website