DRN-4679379

The complaint Mrs C’s complaint is, in essence, that Mitsubishi HC Capital UK Plc (the ‘Lender’) acted unfairly and unreasonably by (1) being party to an unfair credit relationship with her under Section 140A of the Consumer Credit Act 1974 (as amended) (the ‘CCA’) and (2) deciding against paying a claim under Section 75 of the CCA. What happened This complaint relates to the purchase of a type of timeshare membership in 2013. But I will begin by explaining that whilst I understand both Mrs C and her husband Mr C, were involved in these matters, it seems only Mrs C’s name was put onto the credit agreement used to take out the relevant borrowing when she purchased this timeshare membership. For this reason, I will be referring mainly to Mrs C only, in the majority of this Decision. In October 2013, Mrs C purchased a ‘Fractional Club’ membership from a timeshare provider (the ‘Supplier’). The membership was asset backed which meant it included a share of the net sale proceeds of a property named on the purchase agreement (the ‘Allocated Property’) after the membership term ended. Mrs C borrowed £8,850 and with fees and interest charges the total amount repayable was £25,011 payable over 180 months at £138 per month. Using a professional representative (the ‘PR’), Mrs C complained to the Lender on 23 October 2018 (the ‘Letter of Complaint’) to raise a number of different concerns. Further points of complaint were added at certain times thereafter. The Lender dealt with the concerns as a complaint and issued its final response letter, rejecting it on every ground. The complaint was then referred to the Financial Ombudsman Service. It was assessed by one of our investigators who didn’t think we should uphold it in Mrs C’s favour. Mrs C’s PR disagreed with the investigator’s assessment and asked for an ombudsman’s decision, which is why it was passed to me. I issued a provisional decision (PD) about this matter on 2 April 2026. In this I set out comprehensively why it wasn’t my intention to uphold this complaint in Mrs C’s favour. I’ve had a reply from Mrs C’s PR which basically disagrees with my PD on a number of fronts. The Lender agreed with what I’d said in the PD. The legal and regulatory context In considering what is fair and reasonable in all the circumstances of the complaint, I am required under DISP 3.6.4R to take into account: relevant (i) law and regulations; (ii) regulators’ rules, guidance and standards; and (iii) codes of practice; and (where appropriate), what I consider to have been good industry practice at the relevant time. The legal and regulatory context that I think is relevant to this complaint is, in many ways. no different to that shared in several hundred published ombudsman decisions on very similar complaints – which can be found on the Financial Ombudsman Service’s website. And with

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that being the case, it is not necessary to set out that context in detail here. But I would add that the following regulatory rules/guidance are relevant: The Office of Fair Trading’s Irresponsible Lending Guidance – 31 March 2010 The primary purpose of this guidance was to provide greater clarity for businesses and consumer representatives as to the business practices that the Office of Fair Trading (the ‘OFT’) thought might have constituted irresponsible lending for the purposes of Section 25(2B) of the CCA. Below are the most relevant paragraphs as they were at the relevant time: • Paragraph 2.2; Paragraph 2.3; Paragraph 5.5 The OFT’s Guidance for Credit Brokers and Intermediaries - 24 November 2011 The primary purpose of this guidance was to provide clarity for credit brokers and credit intermediaries as to the standards expected of them by the OFT when they dealt with actual or prospective borrowers. Below are the most relevant paragraphs as they were at the relevant time: • Paragraph 2.2; Paragraph 3.7; Paragraph 4.8 What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Having done this, I am not upholding this complaint, and this is my final decision. I’m very sorry to disappoint Mrs C. I want to make it clear that my role as an ombudsman is not to address every single point that has been made to date. Instead, it is to decide what is fair and reasonable in the circumstances of this complaint. So, if I have not commented on, or referred to, something that either party has said, that does not mean I have not considered it. Section 75 of the CCA: the Supplier’s misrepresentations at the Time of Sale The CCA introduced a regime of connected lender liability under Section 75 that affords consumers (“debtors”) a right of recourse against lenders that provide the finance for the acquisition of goods or services from third-party merchants (“suppliers”) in the event that there is an actionable misrepresentation and/or breach of contract by the supplier. Certain conditions must be met if the protection afforded to consumers is engaged, including, for instance, the cash price of the purchase and the nature of the arrangements between the parties involved in the transaction. The Lender doesn’t dispute that the relevant conditions are met. But for reasons I’ll come on to below, it isn’t necessary to make any formal findings on them here. The Letter of Complaint was a relatively long and complex document (and further allegations were made thereafter). But the allegations made, as I broadly understand them, are that Fractional Club membership was misrepresented by the Supplier at the Time of Sale because Mrs C was told or led to believe by the Supplier that Fractional Club membership: 1. had a guaranteed end date when that was not true.

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2. was the only way of releasing her and Mr C from their existing membership when that was not true. 3. was exclusive to them (and other members) when that was not true. As regards point 1, as I understand it the sale of the Allocated Property could be postponed in certain circumstances according to the Fractional Club Rules. But Mrs C says little to nothing to persuade me that she was given a guarantee by the Supplier that the Allocated Property would be sold on a specific date when such a promise would have been impossible to stand by given the inevitable uncertainty of selling property some way into the future. Also, as there simply isn’t enough evidence on file to support the PR’s allegation that Fractional Club membership was misrepresented for reasons relating to points 2 and 3, I’m not persuaded that there were representations by the Supplier on the issues in question that constituted false statements of existing fact. So, while I recognise that Mrs C and the PR have concerns about the way in which this membership was sold by the Supplier, when looking at the claim under Section 75 of the CCA, I can only consider whether there was a factual and material misrepresentation by the Supplier. For the reasons I’ve set out above, I’m not persuaded that there was. This means that I don’t think that the Lender acted unreasonably or unfairly when it dealt with this particular Section 75 claim. Section 75 of the CCA: the Supplier’s Breach of Contract I have already summarised how Section 75 of the CCA works and why it gives consumers a right of recourse against a lender. So, it is not necessary to repeat that here other than to say that, if I find that the Supplier is liable for having breached the Purchase Agreement, the Lender is also liable. Mrs C alleges that holiday accommodation would be secured thanks to Fractional Club membership when that was not true, and on my reading of the complaint, that suggests that she and Mr C could not holiday where and when they wanted to, potentially breaching the Purchase Agreement. However, like any holiday accommodation, availability was not unlimited given the higher demand at peak times, like school holidays, for instance. Some of the sales paperwork likely to have been signed by Mrs C states that the availability of holidays was subject to demand. It also looks like they made use of their fractional points to holiday on a several occasions. I accept that they may not have been able to take certain holidays, but I’ve not seen enough to persuade me that the Supplier had breached the terms of the Purchase Agreement. So, from the evidence I have seen, I don’t think the Lender is liable to pay any compensation for a breach of contract by the Supplier. With that being the case, I do not think the Lender acted unfairly or unreasonably in relation to this aspect of the complaint either. Section 140A of the CCA: did the Lender participate in an unfair credit relationship? I’ve already explained why I’m not persuaded that this membership was actionably misrepresented by the Supplier at the Time of Sale. But there are other aspects of the sales process that, being the subject of dissatisfaction, I must explore with Section 140A in mind if I’m to consider this complaint in full. This is what I’ve done next. The PR now alleges, for instance, that: 1. the right checks weren’t carried out before the Lender lent to Mrs C; 2. Mrs C was pressured by the Supplier into purchasing Fractional Club membership at

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the Time of Sale; 3. there was one or more unfair contract term in the Purchase Agreement; and 4. the membership was marketed and sold as an ‘investment’ in a direct breach of a prohibition on doing so. As I will explain more about later, Mrs C’s representative makes further comments in relation to these areas after the issuing of my PD. However, having considered the entirety of the credit relationship between Mrs C and the Lender along with all of the circumstances of the complaint, I don’t think the credit relationship was likely to have been rendered unfair for the purposes of Section 140A. When coming to that conclusion, and in carrying out my analysis, I have looked at: 1. The standard of the Supplier’s commercial conduct – which includes its sales and marketing practices at the Time of Sale along with any relevant training material; 2. The provision of information by the Supplier at the Time of Sale, including the contractual documentation and disclaimers made by the Supplier; 3. The commission arrangements in place between the Lender and the Supplier. 4. Evidence provided by both parties on what was likely to have been said and/or done at the Time of Sale; 5. The inherent probabilities of the sale given its circumstances; and, when relevant 6. Any existing unfairness from a related credit agreement. I have then considered the impact of these on the fairness of the credit relationship between Mrs C and the Lender. The Supplier’s sales & marketing practices at the Time of Sale While the PR says that the right affordability checks weren’t carried out at the Time of Sale, even if I were to find that the Lender failed to do everything it should have when it agreed to lend (and I make no such finding), I would have to be satisfied that the money lent to Mrs C was actually unaffordable, before also concluding that she lost out as a result, and then consider whether the credit relationship with the Lender was unfair for this reason. But from the very limited information put forward on this, I am not satisfied that the lending was unaffordable for Mrs C. What has essentially been put forward on Mrs C’s behalf is, in my view, the ‘bare bones’ of an unaffordability complaint which is unsupported, and therefore unpersuasive. Although an allegation of pressured selling is another central point of complaint brought by the PR in this case, I think it’s fair to point out that Mrs and Mr C say little about what was said or done by the Supplier during their sales presentation that made them feel as if they had no choice but to purchase this membership when they simply did not want to. In fact, they themselves seem to contradict the sources of arguments used by their PR: I set out exactly why further down. But they were also given a 14-day cooling off period and they have not provided a credible explanation for why they did not cancel their membership during that time. With all of that being the case, there is insufficient evidence to demonstrate that Mrs C made the decision to purchase this membership because of an ability to exercise a choice which was significantly impaired by pressure from the Supplier. I’m afraid the evidence simply doesn’t support this argument. Overall, therefore, I don’t think that Mrs C’s credit relationship with the Lender was rendered unfair under Section 140A for any of the reasons above. But there is another reason, perhaps the main reason, why the PR now says the credit relationship with the Lender was

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unfair; this is a suggestion that the membership was marketed and sold to Mrs C as an investment in breach of prohibition against selling timeshares in that way. The Supplier’s alleged breach of Regulation 14(3) of the Timeshare Regulations The Lender does not dispute, and I am satisfied, that Mrs C’s Fractional Club membership met the definition of a “timeshare contract” and was a “regulated contract” for the purposes of the Timeshare Regulations. Regulation 14(3) of the Timeshare Regulations prohibited the Supplier from marketing or selling Fractional Club membership as an investment. This is what the provision said at the Time of Sale: “A trader must not market or sell a proposed timeshare contract or long-term holiday product contract as an investment if the proposed contract would be a regulated contract.” But the PR says that the Supplier did exactly that at the Time of Sale. The term “investment” is not defined in the Timeshare Regulations. But for the purposes of this provisional decision, and by reference to the decided authorities, an investment is a transaction in which money or other property is laid out in the expectation or hope of financial gain or profit. A share in the Allocated Property clearly constituted an investment as it offered Mrs C the prospect of a financial return – whether or not, like all investments, that was more than what she first put into it. But it is important to note at this stage that the fact that this membership included an investment element did not, itself, transgress the prohibition in Regulation 14(3). That provision prohibits the marketing and selling of a timeshare contract as an investment. It doesn’t prohibit the mere existence of an investment element in a timeshare contract or prohibit the marketing and selling of such a timeshare contract per se. In other words, the Timeshare Regulations did not ban products such as the Fractional Club. They just regulated how such products were marketed and sold. To conclude, therefore, that Fractional Club membership was marketed or sold to Mrs C as an investment in breach of Regulation 14(3), I have to be persuaded that it was more likely than not that the Supplier marketed and/or sold membership as an investment, i.e. told her or led her to believe that membership offered the prospect of a financial gain (i.e., a profit) given the facts and circumstances of this complaint. There is competing evidence in this complaint as to whether Fractional Club membership was marketed and/or sold by the Supplier at the Time of Sale as an investment in breach of regulation 14(3) of the Timeshare Regulations. On the one hand, it is clear that the Supplier made efforts to avoid specifically describing membership of the Fractional Club as an ‘investment’ or quantifying to prospective purchasers, such as Mrs C, the financial value of the share in the net sales proceeds of the Allocated Property along with the investment considerations, risks and rewards attached to them. On the other hand, I acknowledge that the Supplier’s sales process left open the possibility that the sales representative may have positioned Fractional Club membership as an investment. So, I accept that it’s equally possible that Fractional Club membership was marketed and sold to Mrs C as an investment in breach of Regulation 14(3). However, whether or not there was a breach of the relevant prohibition by the Supplier is not ultimately determinative of the outcome in this complaint for reasons I will come on to

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shortly. With that being the case, it’s not necessary to make a formal finding on that particular issue for the purposes of this decision. Was the credit relationship between the parties rendered unfair due to a breach of Regulation 14(3) of the Timeshare Regulations? Having found that it was possible that the Supplier breached Regulation 14(3) of the Timeshare Regulations at the Time of Sale, I now need to consider what impact that breach (if there was one) had on the fairness of the credit relationship between Mrs C and the Lender under the Credit Agreement and related Purchase Agreement, as the case law on Section 140A makes it clear that regulatory breaches do not automatically create unfairness for the purposes of that provision. Such breaches and their consequences (if there are any) must be considered in the round, rather than in a narrow or technical way. Indeed, it seems to me that, if I am to conclude that a breach of Regulation 14(3) led to a credit relationship between Mrs C and the Lender that was unfair and warranted relief as a result, then whether the Supplier’s breach of Regulation 14(3) led her to enter into the Purchase Agreement and the Credit Agreement is an important consideration. However, on my reading of all the evidence before me, I am not persuaded that the prospect of a financial gain from this Fractional Club membership was an important and motivating factor when Mrs C decided to go ahead with the purchase in 2013. The complaint points mainly put forward at the outset of this complaint were matters of alleged unaffordability, undisclosed commission, and the application of unfair pressure, issues I deal with elsewhere in this Decision. It seems to me that these ‘investment’ related allegations came about much later, set out as they are in a ‘client witness statement’ subsequently added to the complaint some years after it was first made. It seems to me that the statement was sent to our Service—the Financial Ombudsman Service—in or around December 2023, and so several years after the lodging of the complaint, and indeed over 10 years after the actual sale. However, this statement’s main failure is that it is neither signed nor dated. And given that Mrs C is professionally represented, I find it surprising that these fundamental issues of provenance are missing and cannot be accounted for. This, and the meaningful divergences from the original points of complaint, cause me to exercise caution as regard these later allegations. Even if I were to accept the statement on face value, Mrs C does concede within it that the future value of the Allocated Property was, in her words, “somewhat dubious”. She also argues that unfair pressure was applied at the time of this sale, both issues I have to say seem inconsistent with her ever realistically considering this purchase as an ‘investment’. But further to the above, in replying to my PD, Mrs C’s PR sent in a questionnaire evidently signed by both her and Mr C in October 2018 at the PR’s request. In my view, this substantially weakens many of the points brought by the PR supposedly on Mrs C behalf. It also substantially weakens the points made in her undated / unsigned statement I’ve mentioned above. It confirms, for example, that the sales process took only two hours, which given the somewhat complex interest in overseas property, doesn’t strike me as supportive to the wider ‘pressure’ allegations being made and of not being allowed to leave the sales venue. But more so, both Mrs and Mr C confirm in this questionnaire that they were never guaranteed a profit, and they were given the opportunity to read the documentation before signing, and also that they had the opportunity to ask questions. Again, this doesn’t strike me as supportive to the wider allegations now being made. I also think it’s important to consider the broader circumstances in which this 2013 sale took place. Mrs and Mr C were long-standing and experienced timeshare purchasers with a

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history going back to the late 1990s. We also know of their holidaying frequency and diversity, as shown by the number of trips they undertook both with this and other timeshare memberships, which I think speaks to the importance they placed on holidaying abroad together. Of course, their obvious enthusiasm for holidaying in this particular way isn’t unreasonable. But I don’t think there is any persuasive evidence that Mrs C made this purchase on the basis of an unspecified investment opportunity, which for her was only realisable in 2032. Everything I’ve seen just isn’t supportive of this. This doesn’t mean they weren’t interested in a share in the Allocated Property. After all, that wouldn’t be surprising given the nature of the product at the centre of this complaint. But I’m afraid that as Mrs C does not persuade me that this purchase was motivated by a share in the Allocated Property and the possibility of a profit, I don’t think a breach of Regulation 14(3) by the Supplier was likely to have been material to the decision she ultimately made. On balance, even if the Supplier had marketed or sold the Fractional Club membership as an investment in breach of Regulation 14(3) of the Timeshare Regulations, I am not persuaded that Mrs C’s decision to purchase Fractional Club membership at the Time of Sale was motivated by the prospect of a financial gain (i.e., a profit). On the contrary, I think the evidence suggests she would have still pressed ahead with the purchase whether or not there had been a breach of Regulation 14(3). So, for that reason, I do not think the credit relationship between Mrs C and the Lender was unfair even if the Supplier had breached Regulation 14(3). The provision of information by the Supplier at the Time of Sale The PR says that Mrs C was not given sufficient information at the Time of Sale by the Supplier about the ongoing costs of this membership. The PR also says that, because some of the terms of the Purchase Agreement weren’t individually negotiated, they were unfair contract terms as were the terms governing the ongoing costs of membership and consequences of non-payment. As I’ve already indicated, the case law on Section 140A makes it clear that it does not automatically follow that regulatory breaches create unfairness for the purposes of the unfair relationship provisions. The extent to which such mistakes render a credit relationship unfair must also be determined according to their impact on the complainant. I acknowledge that it is also possible that the Supplier did not give Mrs and Mr C sufficient information, in good time, on the various charges they could have been subject to as Fractional Club members in order to satisfy the requirements of Regulation 12 of the 2010 Timeshare Regulations (which was concerned with the provision of ‘key information’). But even if that was the case, I cannot see that the ongoing costs of membership were applied unfairly in practice. As neither Mrs C nor the PR have persuaded me that she would not have pressed ahead with the purchase had the finer details of the Fractional Club’s ongoing costs been disclosed by the Supplier in compliance with Regulation 12, I cannot see why any failings in that regard are likely to be material to the outcome of this complaint given its facts and circumstances.

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As for the PR’s argument that there were one or more unfair contract terms in the Purchase Agreement, I can’t see that any such terms were operated unfairly against Mrs C in practice, nor that any such terms led them to behave in a certain way to their detriment. And with that being the case, I’m not persuaded that any of the terms governing Fractional Club membership are likely to have led to an unfairness that warrants a remedy even if they could be said to be unfair contract terms, which I make no formal finding on. Commission As both sides already know, the Supreme Court handed down an important judgment on 1 August 2025 in a series of cases concerned with the issue of commission: Johnson v FirstRand Bank Ltd, Wrench v FirstRand Bank Ltd and Hopcraft v Close Brothers Ltd [2025] UKSC 33 (‘Hopcraft, Johnson and Wrench’). The Supreme Court ruled that, in each of the three cases, the commission payments made to car dealers by lenders were legal, as claims for the tort of bribery, or the dishonest assistance of a breach of fiduciary duty, had to be predicated on the car dealer owing a fiduciary duty to the consumer, which the car dealers did not owe. A “disinterested duty”, as described in Wood v Commercial First Business Ltd & ors and Business Mortgage Finance 4 plc v Pengelly [2021] EWCA Civ 471, is not enough. However, the Supreme Court held that the credit relationship between the lender and Mr Johnson was unfair under Section 140A of the CCA because of the commission paid by the lender to the car dealer. The main reasons for coming to that conclusion included, amongst other things, the following factors: 1. The size of the commission (as a percentage of the total charge for credit). In Mr Johnson’s case it was 55%. This was “so high” and “a powerful indication that the relationship…was unfair” (see paragraph 327); 2. The failure to disclose the commission; and 3. The concealment of the commercial tie between the car dealer and the lender. The Supreme Court also confirmed that the following factors, in what was a non-exhaustive list, will normally be relevant when assessing whether a credit relationship was/is unfair under Section 140A of the CCA: 1. The size of the commission as a proportion of the charge for credit; 2. The way in which commission is calculated (a discretionary commission arrangement, for example, may lead to higher interest rates); 3. The characteristics of the consumer; 4. The extent of any disclosure and the manner of that disclosure (which, insofar as Section 56 of the CCA is engaged, includes any disclosure by a supplier when acting as a broker); and 5. Compliance with the regulatory rules. From my reading of the Supreme Court’s judgment in Hopcraft, Johnson and Wrench, it sets out principles which apply to credit brokers other than car dealer–credit brokers. So, when considering allegations of undisclosed payments of commission like the one in this complaint, Hopcraft, Johnson and Wrench is relevant law that I’m required to consider under Rule 3.6.4 of the Financial Conduct Authority’s Dispute Resolution Rules (‘DISP’).

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But I don’t think Hopcraft, Johnson and Wrench assists Mrs C in arguing that the credit relationship with the Lender was unfair for reasons relating to commission given the facts and circumstances of this complaint. As the Supreme Court said in paragraph 326 of its judgment in Hopcraft, Johnson and Wrench, it’s not possible to simply apply the reasoning of the Supreme Court in Plevin v Paragon Personal Finance Ltd [2014] UKSC 61 (‘Plevin’) to this complaint (as the PR does) when it’s concerned with a product and marketplace that were very different to those in Plevin. What’s more, Mrs C was provided with information as to the price of this membership and the cost of the Credit Agreement (interest rate, fees, APR and monthly repayments). So, she was at least in a position from which she could understand the cost of the Credit Agreement and compare it with other options that might have been available at the time. I haven’t seen anything to suggest that the Lender and Supplier were tied to one another contractually or commercially in a way that wasn’t properly disclosed to Mrs C, nor have I seen anything that persuades me that the commission arrangement between them gave the Supplier a choice over the interest rate that led Mrs C into a credit agreement that cost disproportionately more than it otherwise could have. I acknowledge that it’s possible that the Lender and the Supplier failed to follow the regulatory guidance in place at the Time of Sale insofar as it was relevant to disclosing the commission arrangements between them. But as I’ve said before, the case law on Section 140A makes it clear that regulatory breaches do not automatically create unfairness for the purposes of that provision. Such breaches and their consequences (if there are any) must be considered in the round, rather than in a narrow or technical way. And with that being the case, it isn’t necessary to make a formal finding on that because, even if the Lender and the Supplier failed to follow the relevant regulatory guidance at the Time of Sale, it is for the reasons set out below that I don’t currently think any such failure is itself a reason to find the credit relationship in question unfair to Mrs C. In stark contrast to the facts of Mr Johnson’s case, the amount of commission paid by the Lender to the Supplier for arranging the Credit Agreement that Mrs C entered into wasn’t high. At £862.88, it was only 9.75% of the amount borrowed and even less than that (5.34%) as a proportion of the charge for credit. So, had she known at the Time of Sale that the Supplier was going to be paid a flat rate of commission at that level, I’m not persuaded that she either wouldn’t have understood that or would have otherwise questioned the size of the payment at that time. After all, Mrs C wanted the membership and had no obvious means of her own to pay for it. At such a relatively low level, the impact of commission on the cost of the credit needed for a timeshare she and Mr C wanted doesn’t strike me as disproportionate. So, I think she would still have taken out the loan to fund the purchase at the Time of Sale had the amount of commission been disclosed. What’s more, based on what I’ve seen so far, the Supplier’s role as a credit broker wasn’t a separate service and distinct from its role as the seller of timeshares. It was simply a means to an end in the Supplier’s overall pursuit of a successful timeshare sale. I can’t see that the Supplier gave an undertaking, either expressly or impliedly, to put to one side its commercial interests in pursuit of that goal when arranging the Credit Agreement. As it wasn’t acting as an agent of Mrs C but as the supplier of contractual rights obtained under the Purchase Agreement, the transaction doesn’t strike me as one with features that suggest the Supplier had an obligation of ‘loyalty’ when arranging the Credit Agreement and thus a fiduciary duty. Overall, therefore, I’m not persuaded that the commission arrangements between the Supplier and the Lender were likely to have led to a sufficiently extreme inequality of knowledge that rendered the credit relationship unfair.

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Commission: The Alternative Grounds of Complaint While I’ve found that Mrs C credit relationship with the Lender wasn’t unfair for reasons relating to the commission arrangements between it and the Supplier, two of the grounds on which I came to that conclusion also constitute separate and freestanding complaints to this complaint about an unfair credit relationship. So, for completeness, I’ve considered those grounds on that basis here. The first ground relates to whether the Lender is liable for the dishonest assistance of a breach of fiduciary duty by the Supplier because it took a payment of commission from the Lender without telling Mrs C (i.e., secretly). The second relates to the Lender’s compliance with the regulatory guidance in place at the Time of Sale insofar as it was relevant to disclosing the commission arrangements between them. However, for the reasons I set out above, I’m not persuaded that the Supplier, when acting as credit broker, owed Mrs C a fiduciary duty. So, the remedies that might be available at law in relation to the payment of secret commission aren’t, in my view, available. While it’s possible that the Lender failed to follow the regulatory guidance in place at the Time of Sale insofar as it was relevant to disclosing the commission arrangements between it and the Supplier, I don’t think any such failure on the Lender’s part is itself a reason to uphold this complaint because, for the reasons I also set out above, I think she would still have taken out the loan to fund the purchase at the time had there been more adequate disclosure of the commission arrangements that applied. Reply to the provisional decision (PD) • Overview As I said in my PD, my role as an ombudsman is to decide what is fair and reasonable in the circumstances of this complaint, rather than to address every single point that’s been made. So, once again, while I have read all of the PR’s re-submissions in full, if I have not commented on or referred to something that either party has said, that does not mean I have not considered it. What’s more, it is important to make the point that, in contrast to what might happen in court, neither side to this complaint has a burden of proof that it must discharge. After all, the jurisdiction under which I’m deciding this complaint is inquisitorial rather than adversarial which means that my findings are made, on the balance of probabilities, in light of the evidence and / or arguments from both sides. As I have implied before, the PR’s submissions about this complaint have been substantial, with hundreds of pages of documents, some of which are contradictory in nature. The post- PD submission from the PR refers to several detailed points of law (and case law) which I do not intend to engage with in writing, other than to say that I have carefully considered all of the matters raised by the PR, and having done so, I remain satisfied that as and when appropriate, I have applied the law correctly across the board when arriving at a fair and reasonable outcome in this case. • Inconsistencies with the PR’s allegations I think there are a number of inconsistencies evident regarding what Mrs C herself says - and what the PR argues when saying her complaint ought to be upheld.

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For example, I think the post-PD submission of a signed 2018 ‘questionnaire’, poses some significant questions for many of the points of complaint brought specifically by Mrs C’s PR. I say this because this form seems to portray what happened during the 2013 sale in quite a different light. When asked to explain her experience of the timeshare she bought in 2013, Mrs C first confirms on that questionnaire that she was given time to read the sales paperwork before making any decision. So, contrary to the allegations made by her PR, this does not support the claim that they were in some way ‘detained in situ’ until they signed up for something they felt uncomfortable with. In fact, they also confirm they neither attempted to leave the sales venue, nor were they specifically prevented by the Supplier from doing so as implied by their PR. More so, when asked if she and Mr C were told of any “profit” when buying the Fractional Club membership, I note she answered “no”. There’s also nothing on the questionnaire which implies to me that affordability was a serious concern when buying this membership. So, the fact that ‘pressure’ and ‘investment’ allegations are all prominently repeated in the PR’s response1 to my PD, in my view further weakens the credibility of many of the points of complaint on which this case is apparently based. Simply put, there is very persuasive evidence to the contrary. And when the PR repeats now that there were “high pressure sales tactics” evident and that Mrs C told it that “we were expected to say yes or no, then”, it strikes me that these perspectives are wholly without merit, given the personal testimony from the consumers themselves. It therefore continues to seem much more likely to me that Mrs C bought the 2013 membership against a backdrop of her and Mr C being existing customers who were interested primarily in holidaying abroad and using the diverse opportunities they thought could be obtained using this type of membership. I have, of course, fully explained this above (and see no reason to change it). So, what all this means is that I’m still not persuaded that the prospect of a financial gain from Fractional Club membership was an important and motivating factor when Mrs C decided to go ahead with the purchase, such that she would have made an entirely different purchasing decision had there not been a breach of Regulation 14(3). As I said before, even if there was a possibility of a breach of this Regulation, I am convinced she would have still made the purchase, because that is what she and Mr C wanted to do at the time. • Other points from the PD reply The law relating to misrepresentation is a combination of the common law, equity and statute – though, as I understand it, the Misrepresentation Act 1967 didn’t alter the rules as to what constitutes an effective misrepresentation. Summarising the relevant pages in Chitty on Contracts, a material and actionable misrepresentation is an untrue statement of existing fact or law made by one party (or his agent for the purposes of passing on the representation, acting within the scope of his authority) to another party that induced that party to enter into a contract. However, a mere statement of opinion, rather than fact or law, which proves to be unfounded, isn’t a misrepresentation unless the opinion amounts to a statement of fact and it can be proved that the person who gave it did not hold it or could not reasonably have held it. It also needs to be shown that the other party understood and relied on the implied factual misrepresentation. I’ve seen no persuasive of that here. 1 See: ‘FURTHER SUBMISSION TO THE FINANCIAL OMBUDSMAN SERVICE’ document 16 April 2026

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Telling prospective members that they were investing their money because they were buying a fraction or share of one of the Supplier’s properties was not untrue – nor was it untrue to tell prospective members that they would receive some money when the allocated property is sold. After all, Mrs C’s share in the Allocated Property clearly constituted an investment as it offered her the prospect of a financial return – whether or not, like all investments, that was more than what she first put into it. But as I’ve said, in any event Mrs C herself doesn’t actually allege this in a meaningful way. Also, the case law on Section 140A makes it clear that it does not automatically follow that regulatory breaches create unfairness for the purposes of the unfair relationship provisions. The extent to which such mistakes render a credit relationship unfair must also be determined according to their impact on the complainant. So, even if it could be said that the Supplier failed to give Mrs C sufficient information, in good time, in order to satisfy the requirements of Regulation 12 of the Timeshare Regulations for some of the reasons the PR gives, neither she nor the PR have persuaded me that they were deprived of information that would have led them to make a different purchasing decision at the Time of Sale when I’ve already found that the prospect of a financial gain from the Allocated Property was not an important and motivating factor behind her purchase. With that being the case, even if there were information failings (which I make no formal finding on), I can’t see why that could be said to have rendered the credit relationship in question unfair. Overall Conclusion I have considered this complaint comprehensively and thought very carefully about everything submitted by both sides following the issuing of my provisional decision. Given all the facts and circumstances, I do not think that the Lender acted unfairly or unreasonably when it dealt with the Section 75 claim(s). I am also not persuaded that the Lender was party to a credit relationship under the Credit Agreement and related Purchase Agreement that was unfair for the purposes of Section 140A of the CCA. My final decision I do not uphold this complaint. I do not require Mitsubishi HC Capital UK Plc to do anything more. Under the rules of the Financial Ombudsman Service, I’m required to ask Mrs C to accept or reject my decision before 25 May 2026. Michael Campbell Ombudsman

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