Partially upheld: Goods and services under S75 complaint against HSBC UK Bank Plc

Decision detail

Summary

Mr A purchased a used car for £29,200 (paying £1,000 by credit card) and subsequently reported multiple defects including paintwork damage, misaligned bonnet, and faulty components. He claimed breach of contract under section 75 of the Consumer Credit Act 1974. HSBC initially considered a chargeback but did not pursue it, then handled the section 75 claim poorly with unclear communication and unexplained delays, never directly informing Mr A of its position. The ombudsman found insufficient evidence that the car was not of satisfactory quality given its age, mileage, and price, but upheld the complaint in part due to HSBC's deficient claims handling, awarding £150 additional compensation for distress and inconvenience caused by poor communication and lack of closure.

The Ombudsman's reasoning

The ombudsman found that while HSBC's handling of the claim was poor and caused distress through lack of clear communication and unexplained delays, the evidence did not establish a breach of contract regarding the car's satisfactory quality. For a used car of that age (5 years), mileage (26,500 miles), and price (slightly below market value), the reported defects did not conclusively demonstrate the car was not of satisfactory quality at point of sale. The evidence was inconclusive and largely non-contemporaneous to the sale date. However, HSBC failed to clearly explain its position, missed opportunities to close the claim, and did not directly communicate its requirement for an independent report to Mr A, causing unnecessary distress and inconvenience.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website