Not upheld: unfair credit relationship under Section 140A of the Consumer Credit Act 1974 and connected lender liability under Section 75 of the Consumer Credit Act 1974 complaint against Clydesdale Financial Services Limited (trading as Barclays Partner Finance)

Decision detail

Summary

Mr B purchased a non-fractional timeshare membership in 2011 for £4,000 financed through a credit agreement with Clydesdale Financial Services Limited. In May 2024, over 13 years later, Mr B's professional representative submitted claims under Section 75 (connected lender liability for misrepresentation and breach of contract) and Section 140A (unfair credit relationship) of the Consumer Credit Act 1974. The Lender rejected both claims. The Ombudsman found the Section 75 claim time-barred under the Limitation Act 1980 and the Section 140A claim unsupported by sufficient evidence. The claimant failed to demonstrate that the lending was unaffordable, that he was pressured into the purchase despite having a 14-day cooling-off period, or that the product was sold as an investment (it contained no investment element). The complaint was not upheld.

The Ombudsman's reasoning

The Ombudsman found that the Section 75 claim was time-barred under the Limitation Act 1980 because Mr B did not make his claim within six years of the alleged misrepresentations (2011) or breaches of contract. The claim was made in 2024, well outside the limitation period. The Ombudsman rejected the argument that misrepresentation was concealed, finding no persuasive evidence of concealment and noting that Mr B was aware of increasing fees as he complained about them. For the Section 140A unfair credit relationship claim, the Ombudsman found insufficient evidence to support the allegations. The PR failed to provide substantive evidence that the lending was unaffordable, that Mr B was pressured into the purchase (particularly given the 14-day cooling-off period he did not use), or that the product was sold as an investment (the product contained no investment element). The Ombudsman applied the principle from case law that although the Lender must treat claims fairly, the claimant must properly make out the facts of their claim, and unsubstantiated allegations are insufficient.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website