Not upheld: unfair credit relationship under Section 140A of the Consumer Credit Act 1974; misrepresentation claims under Section 75 of the Consumer Credit Act 1974; alleged breach of Regulation 14(3) of the Timeshare Regulations; alleged breach of Financial Services and Markets Act 2000 complaint against Mitsubishi HC Capital PLC trading as Novuna Personal Finance

Decision detail

Summary

Mrs O purchased fractional timeshare points in July and October 2017, financed through credit agreements with Novuna Personal Finance. In March 2024, her representative complained that the supplier misrepresented the timeshare as an investment and that the lender was party to an unfair credit relationship. The complaint alleged breaches of the Timeshare Regulations and unauthorized investment sales. The ombudsman found that misrepresentation claims were barred by the six-year limitation period and that the Section 140A unfair credit relationship claim failed because Mrs O's purchase was motivated by holiday benefits rather than investment returns. The ombudsman rejected arguments about pressure, exploitation, and undisclosed commission arrangements, finding insufficient evidence or material impact on Mrs O's decision-making. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the Limitation Act 1980 to bar Section 75 misrepresentation claims as they were made more than six years after the cause of action accrued in July and October 2017. For the Section 140A unfair credit relationship claim, the ombudsman found that Mrs O's purchase was motivated by holiday benefits and exclusivity rather than investment returns, so any breach of Regulation 14(3) of the Timeshare Regulations would not have caused her to make a different purchasing decision. The ombudsman rejected arguments about pressure, exploitation, and information failures, finding they lacked evidentiary support or material impact on Mrs O's decision-making. The commission arrangements, while possibly undisclosed, were not so high or structured as to render the relationship unfair compared to the Supreme Court's findings in Hopcraft, Johnson and Wrench.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website