Partially upheld: misadvice on voluntary termination rights and failure to properly explain quality of goods complaint options complaint against Tandem Motor Finance Limited
Financial Ombudsman decision DRN-6425725 of 2026-06-12T00:00:00+00:00. misadvice on voluntary termination rights and failure to properly explain quality of goods complaint options complaint against Tandem Motor Finance Limited. Outcome: Partially upheld.
Decision detail
| Reference | DRN-6425725 |
|---|---|
| Decision date | 2026-06-12T00:00:00+00:00 |
| Firm | Tandem Motor Finance Limited |
| Product | Motor finance (PCP / HP) |
| Claim type | misadvice on voluntary termination rights and failure to properly explain quality of goods complaint options |
| Outcome | Partially upheld |
| Remedy | Tandem Motor Finance Limited directed to: (1) collect the car at no cost to Ms C and settle the repair bill with the dealer and outstanding storage fees; (2) end the finance agreement and record it as having been voluntarily terminated in September 2025; (3) refund any overpayment of monthly rentals plus 8% simple yearly interest if Ms C has already paid half the total amount due; (4) bill Ms C for any shortfall in monthly rentals to reach half the amount due; (5) bill Ms C for repair costs settled with the dealer or (if lower) the amount Tandem would have charged for the same work; (6) pay Ms C £150 compensation; (7) work with Ms C on a suitable repayment plan for any amounts owed. |
Summary
Ms C complained that Tandem Motor Finance Limited misadvised her regarding voluntary termination of a hire purchase agreement for a second-hand car. After the turbo failed and caused engine damage requiring £8,225.27 in repairs, Advisor 2 incorrectly stated that the car had to be roadworthy to return it via voluntary termination, failing to mention she could return it with existing damage and have Tandem assess the liability. The ombudsman found the advice was deficient but that Ms C remained liable for repairs because the turbo failure was not inherent at point of sale and the car did not meet roadworthy return standards. The ombudsman partially upheld the complaint and directed Tandem to collect the car, settle repair and storage bills, end the agreement as if voluntarily terminated in September 2025, and pay £150 compensation, while allowing Ms C to arrange an affordable repayment plan for any remaining liability.
The Ombudsman's reasoning
The ombudsman found that while Advisor 2 failed to clearly explain Ms C's right to return the car via voluntary termination without repairs, this did not change her overall financial liability because: (1) the turbo failure was not inherent at point of sale (car had been used for 2+ years and 18,000 miles); (2) the car's age (9 years), mileage (82,000), and partial service history meant the turbo failure was not unreasonably premature; (3) under car return standards, the vehicle must be roadworthy, and Ms C's vehicle was not; (4) had Ms C returned the car unrepaired, she would likely still owe Tandem for repairs. However, the ombudsman found it fair to place Ms C in the position she would have been in had she properly exercised voluntary termination, allowing her to avoid storage costs and arrange an affordable repayment plan with Tandem rather than paying the dealer in a lump sum.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Tandem Motor Finance Limited, all decisions | 78 | 58% |
| Motor finance (PCP / HP), all decisions | 18,521 | 38% |
Source
Read the original decision on the Financial Ombudsman Service website