Not upheld: Goods and services under S75 complaint against Mitsubishi HC Capital UK PLC, trading as Novuna Personal Finance

Decision detail

Summary

Mr C complained that Mitsubishi HC Capital UK PLC (trading as Novuna Personal Finance) acted unfairly by being party to an unfair credit relationship and by rejecting his Section 75 claim regarding alleged misrepresentation by the timeshare supplier. Mr C alleged he was told that purchasing Ocean Club timeshare membership would terminate his existing timeshare, which proved untrue. The ombudsman found no evidence of actionable misrepresentation, noting that the signed terms explicitly stated the purchase was not conditional on terminating other memberships and Mr C had a 14-day cooling-off period he did not use. Regarding the unfair credit relationship claim, the ombudsman considered multiple factors including sales practices, information provision, and commission arrangements, but found that while regulatory failings may have occurred, they did not render the credit relationship unfair under Section 140A, particularly as no commission was paid to the supplier and Mr C was provided with pricing information. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found insufficient evidence to support the allegation that the supplier made a factual misrepresentation regarding termination of the existing timeshare. The signed terms and conditions explicitly stated the purchase was not conditional on resale of other memberships. Regarding the Section 140A unfair credit relationship claim, the ombudsman considered multiple factors including the supplier's sales practices, information provision, and commission arrangements. While acknowledging possible regulatory failings, the ombudsman applied the principle that regulatory breaches do not automatically render a credit relationship unfair under Section 140A. The ombudsman distinguished this case from the Supreme Court's decision in Hopcraft, Johnson and Wrench, noting that the lender paid no commission to the supplier at the time of sale, Mr C was provided with pricing information allowing comparison, and there was no evidence of a fiduciary duty owed by the supplier to Mr C.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website