Not upheld: excess mileage charges on vehicle finance agreement complaint against Volkswagen Financial Services (UK) Limited trading as Audi Financial Services

Decision detail

Summary

Mr C complained that VWFS unfairly applied an excess mileage charge of £3,003.07 after he purchased a car at the end of a personal contract hire agreement, claiming he understood the charge would not apply if he kept the car. VWFS maintained the charge was applied in accordance with the agreement terms, which clearly provided for excess mileage charges when the 50,000-mile allowance was exceeded; the car had exceeded this by over 31,000 miles. The ombudsman found no evidence in the agreement or purchase documentation supporting Mr C's claim that purchasing the car would remove liability for excess mileage charges, and rejected arguments that the reduced purchase price already accounted for the excess mileage. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the balance of probabilities standard due to incomplete and contradictory evidence. The agreement itself clearly provided for excess mileage charges where the agreed allowance was exceeded. The ombudsman found no evidence in the agreement or purchase documentation stating that purchasing the car removed those liabilities. The reduced purchase price reflecting the car's higher mileage did not prevent VWFS from applying excess mileage charges, as the original agreement pricing was based on the car not exceeding the mileage allowance, and the excess mileage charge was intended to compensate for additional depreciation and reduced residual value. The purchase price reflected the market value at the point of sale and was a separate consideration from the excess mileage charge. While some call recordings were unavailable, the ombudsman could not fairly conclude VWFS misled Mr C or waived the charges based on available evidence.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website