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

Decision detail

Summary

Mr S complained that Novuna Personal Finance acted unfairly by being party to an unfair credit relationship and declining a Section 75 claim regarding his £18,490 loan for Fractional Club timeshare membership purchased in September 2018. The complaint alleged the Supplier misrepresented the product as an investment in breach of Timeshare Regulations, that Novuna lent irresponsibly, and that unfair contract terms and sales pressure were involved. The ombudsman found no actionable misrepresentation under Section 75, and while acknowledging a possible breach of the investment marketing prohibition, concluded this was not causative of the purchase decision as Mr and Mrs S were primarily motivated by holiday access. The ombudsman rejected all grounds of complaint, finding the credit relationship was not unfair to Mr S under Section 140A of the Consumer Credit Act 1974.

The Ombudsman's reasoning

The ombudsman found no actionable misrepresentation by the Supplier under Section 75, as the representations about the Fractional Club were either factually accurate or honestly held opinions. Regarding Section 140A, while a possible breach of Regulation 14(3) of the Timeshare Regulations (marketing as an investment) was acknowledged, the ombudsman found this was not causative of Mr and Mrs S's purchase decision. The evidence showed their primary motivation was access to broader holiday options, not financial gain. Mr and Mrs S's recollections about the investment element were vague and lacked detail, and they had not raised concerns about the investment aspect in prior complaints. The ombudsman applied the principle from case law that regulatory breaches do not automatically create unfairness under Section 140A; the impact and causation must be considered in the round.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website