Partially upheld: Section 75 Consumer Credit Act claim - supplier breach of contract and failure to deliver service complaint against American Express Services Europe Limited (AESEL)

Decision detail

Summary

Mr C purchased dental aligners using an AESEL credit card in June 2022 and completed core treatment by April 2023. When the supplier went into administration in December 2023, Mr C could not access promised follow-up aligners and requested a full refund under Section 75 of the Consumer Credit Act 1974. AESEL rejected the claim, and the ombudsman upheld the complaint in part. While finding no breach of explicit contract terms (the contract contained a no-guarantee clause) and no evidence of failure to perform with reasonable care and skill, the ombudsman determined Mr C should be compensated for loss of access to the lifetime guarantee scheme. The ombudsman directed AESEL to pay £220, representing the value of one year's touch-up aligners, rather than the full £1,539 refund requested.

The Ombudsman's reasoning

The ombudsman found no breach of explicit contract terms as the supplier's contract contained a no-guarantee clause. Mr C failed to provide expert evidence that the service was not performed with reasonable care and skill as required by the Consumer Rights Act 2015. While Mr C likely qualified for the lifetime guarantee scheme, this would never have entitled him to a full refund - refunds were only available within 30 days of purchase if aligners were unused. The fair remedy was compensation equivalent to one year's benefit from the lifetime guarantee (one set of touch-up aligners valued at £220), as it was impossible to determine how many years of touch-ups Mr C might have actually received given the conditional nature of the guarantee.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website