Not upheld: Goods and services under S75 complaint against Shawbrook Bank Limited

Decision detail

Summary

Mrs S purchased a Fractional Club timeshare membership for £12,521 financed by Shawbrook Bank in November 2015. She later complained that the supplier misrepresented the product as an investment in breach of Timeshare Regulations, that the credit relationship was unfair under Section 140A of the CCA, and that the lender wrongly rejected her Section 75 claim. The ombudsman found no actionable misrepresentation, as Mrs S's testimony indicated she was primarily motivated by holiday use rather than investment returns. Although a possible breach of Regulation 14(3) was acknowledged, the ombudsman found this did not render the credit relationship unfair because Mrs S would likely have proceeded with the purchase regardless. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied a holistic approach to Section 140A analysis, considering whether any regulatory breaches or unfair conduct rendered the credit relationship unfair. While acknowledging that a breach of Regulation 14(3) was possible, the ombudsman found this was not determinative without evidence that such breach materially influenced Mrs S's purchasing decision. The evidence showed Mrs S was primarily motivated by holiday use rather than investment returns. The ombudsman rejected arguments about pressure, unfair terms, and commission arrangements, finding no sufficient evidence of material misrepresentation or unfairness. The ombudsman distinguished the case from Johnson on the basis that no commission was actually paid and Mrs S had adequate price information.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website