Not upheld: default notice compliance and account default complaint against Gain Credit LLC trading as Drafty

Decision detail

Summary

Mr R complained that Drafty unfairly and disproportionately defaulted his running credit facility account after he missed November and December 2025 payments. Drafty issued a default notice on 3 January 2026 requiring payment of £581.97 by 24 January 2026, which Mr R paid late on 24-25 January 2026. Mr R argued the default was disproportionate given the minimal delay, the default notice address was defective with a duplicated house number, and he was abroad in a different timezone when the deadline expired. The ombudsman found the default notice was validly delivered via email, complied with Consumer Credit Act requirements, and Drafty was entitled to record the default as payment was received after the contractual deadline, rejecting arguments based on proportionality and Mr R's personal circumstances.

The Ombudsman's reasoning

The ombudsman applied a strict technical interpretation of the default notice requirements under the Consumer Credit Act 1974. While acknowledging the duplicated house number on the postal address, the ombudsman found the notice was validly delivered via email. The ombudsman determined that Mr R must have received notice as evidenced by his attempt to pay the exact amount required. The payment deadline of 23 January 2026 was contractually binding regardless of Mr R's circumstances, including being abroad and in a different timezone. The ombudsman found Drafty was entitled to issue the default notice when the account was two months in arrears, as it would be three months in arrears by the deadline expiry. The ombudsman rejected arguments about proportionality and fairness, stating these do not override regulatory compliance requirements.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website