Not upheld: Section 75 Consumer Credit Act claim for misrepresentation; unfair credit relationship under Section 140A CCA; alleged undisclosed commission; alleged breach of Timeshare Regulations complaint against Shawbrook Bank Limited

Decision detail

Summary

Mr and Mrs F complained that Shawbrook Bank Limited failed to honour Section 75 claims and participated in an unfair credit relationship under Section 140A of the Consumer Credit Act 1974 in relation to two timeshare purchases made in November 2014 and December 2015. The ombudsman found that the Section 75 claims relating to the 2014 purchase were time-barred under the Limitation Act 1980, as the claims were not notified until September 2023, more than six years after the cause of action accrued. For the 2015 purchase, the ombudsman found no evidence supporting allegations of misrepresentation regarding holiday availability, determined the product was not marketed as an investment, found no evidence of undue pressure (noting Mr and Mrs F did not use their cooling-off period), and established that no commission was paid by the Lender to the Supplier. The ombudsman rejected the complainants' arguments that unfairness from the 2014 purchase carried through to the 2015 purchase, as the two credit agreements were separate and not related agreements. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the Limitation Act 1980 to find that Section 75 claims for the 2014 purchase were time-barred, as the cause of action accrued on 24 November 2014 and the claim was not notified until September 2023 (nearly nine years later). For the 2015 purchase, the ombudsman found insufficient evidence to support allegations of misrepresentation regarding holiday availability, rejected the characterization of the product as an investment based on the agreed legal definition requiring expectation of financial gain or profit, found no evidence of undue pressure (noting Mr and Mrs F did not use their cooling-off period), and determined that no commission was paid by the Lender to the Supplier. The ombudsman applied the Supreme Court's guidance in Hopcraft, Johnson and Wrench regarding commission arrangements but found it inapplicable given the absence of any commission payment.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website