Not upheld: Goods and services under S75 complaint against Volkswagen Financial Services (UK) Limited

Decision detail

Summary

Mr G complained about a used vehicle acquired through a hire purchase agreement with VWFS that had recurring issues from the first week. After approximately seven months of unsuccessful repair attempts, the vehicle was replaced with a new one under a new finance agreement, and VWFS offered £500 compensation. Mr G was unhappy because he felt his £5,250 deposit and monthly payments were not adequately recognized, and he believed only £1,000 from his previous agreement carried over to the new one. The ombudsman found the vehicle was not of satisfactory quality and replacement was fair, but determined that when accounting for the part exchange allowance (£2,000), applied discounts (£2,095.70), and finance deposit allowance (£3,625.00) on the replacement agreement, Mr G's original deposit was not lost. The complaint was not upheld, with the £500 compensation deemed fair for the distress and inconvenience caused.

The Ombudsman's reasoning

The ombudsman accepted that the vehicle was not of satisfactory quality and that replacement was a fair remedy. While acknowledging the replacement could have occurred sooner, the ombudsman found that Mr G was not unfairly treated overall. The key finding was that when examining the replacement agreement's part exchange allowance (£2,000), applied discounts (£2,095.70), and finance deposit allowance (£3,625.00), Mr G's original £5,250 deposit was not lost, though this may not have been clearly communicated. The £500 compensation was deemed fair for the distress and inconvenience caused by repeated repairs and the time taken to resolve the matter.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website