Not upheld: unfair credit relationship under Section 140A of the CCA; connected lender liability under Section 75 of the CCA; alleged breach of Timeshare Regulations; undisclosed commission complaint against Mitsubishi HC Capital UK PLC, trading as Novuna Personal Finance

Decision detail

Summary

Mr T complained that Novuna Personal Finance acted unfairly by being party to an unfair credit relationship and by rejecting his Section 75 claim regarding the purchase of Signature Collection timeshare membership financed by a £12,376 credit agreement in August 2016. Mr T alleged the Supplier misrepresented the product as offering savings and exclusivity, marketed it as an investment in breach of Timeshare Regulations, failed to provide adequate information about ongoing costs, and that an undisclosed commission was paid. The ombudsman found insufficient evidence of actionable misrepresentation, concluded that Mr T's later emphasis on investment motivation was inconsistent with his original complaint filed over 5 years after purchase, and distinguished the case from recent Supreme Court authority on commission. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found insufficient evidence of actionable misrepresentation regarding savings on holiday accommodation or exclusivity. While acknowledging the possibility that the Supplier may have breached Regulation 14(3) by marketing the product as an investment, the ombudsman concluded this was not determinative. Critically, the ombudsman found Mr T's later statement emphasizing investment motivation inconsistent with his original Letter of Complaint, which made no mention of investment elements. The ombudsman was not persuaded that Mr T's purchasing decision was motivated by investment prospects. Regarding commission, the ombudsman distinguished the case from the Supreme Court's Johnson decision, noting no commission was payable at the time of the Credit Agreement and the Supplier was not acting as Mr T's agent but as the seller of contractual rights.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website