Close Brothers Limited · DRN-6182695

The complaint Mr W is unhappy that a van supplied to him under a conditional sale agreement with Close Brothers Limited trading as Close Brothers Motor Finance was of an unsatisfactory quality. What happened In December 2024, Mr W was supplied with a used van through a conditional sale agreement with Close Brothers. He paid an advance payment of £3,000 and the agreement was for £11,394 over 60 months; with 59 monthly payments of £275.26 and a final payment of £285.26. At the time of supply, the van was over four years old and had done around 97,000 miles (the MOT record for 31 July 2024 shows the van had done 83,946 miles, while the agreement shows a mileage of 97,000 miles). Mr W had some problems with the van during May and June 2025. Some repairs were carried out in May 2025, some of the costs of which were covered by the warranty. However, after having the van inspected by a manufacturer’s approved garage (‘the garage’), Mr W complained to Close Brothers. He was also unhappy with how he’d been treated by the supplying dealership, both when he went to collect the van, and when he subsequently raised issues with them. Close Brothers arranged for the van to be inspected by an independent engineer. This inspection took place on 7 August 2025, when the van had done 100,066 miles – around 3,000 miles since being supplied to Mr W. The engineer said there was an oil leak that had been present or developing at the point of supply. They also said the timing belt most likely hadn’t been changed since the van was built, but they didn’t say this needed replacement. Based on this report, on 14 August 2025 Close Brothers agreed to repair the oil leak and pay Mr W £200 compensation for what had happened. Mr W would only agree to the van being repaired at the garage, and Close Brothers agreed to this. However, the van didn’t go in for repair and Mr W registered it as being off the road through a SORN with the DVLA. He then parked the van on what he believed was a private road. However, Mr W had actually parked the van on a public highway, and the van was impounded by the DVLA. Close Brothers paid to recover the van to private storage, but they said Mr W remained responsible for these costs, totalling £368. Subject to Mr W paying these costs, Close Brothers agreed to: • repair the oil leak and any subsequent damage; • cover the costs of an MOT, as a gesture of goodwill, given that the MOT had now expired; • refund the payments Mr W paid from when the van broke down on 31 July 2025 until the oil leak repairs have been completed; and • pay Mr W £500 compensation for what has happened. Mr W had already brought this matter to the Financial Ombudsman Service for investigation. Our investigator agreed that Close Brothers had made a fair and reasonable offer in the circumstances. So, they didn’t think Close Brothers needed to increase this.

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Mr W didn’t agree with the investigator’s opinion. He disputed that he was responsible for the failed collection of the van, and he said that Close Brothers agreed to replace the timing belt but have subsequently said they won’t do this. So, he asked that this matter be passed to an ombudsman to decide. 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 so, I’ve reached the same overall conclusions as the investigator, and for broadly the same reasons. If I haven’t commented on any specific point, it’s because I don’t believe it’s affected what I think is the right outcome. Where evidence has been incomplete or contradictory, I’ve reached my view on the balance of probabilities – what I think is most likely to have happened given the available evidence and wider circumstances. In considering this complaint I’ve had regard to the relevant law and regulations; any regulator’s rules, guidance and standards, codes of practice, and (if appropriate) what I consider was good industry practice at the time. While, in his complaint email of 30 September 2025, Mr W said, “the van was purchased with the intention of converting it into a campervan”, in the same email he’s referred to a cancelled transport contract and the loss of £2,500 income from this. What’s more, in an email dated 13 November 2025, Mr W said the van had been taken for repair with all his work equipment in it. Mr W was supplied with a van under a conditional sale agreement. Based on the evidence I’ve seen, I’m satisfied Mr W’s intended use of the van was predominantly for business purposes – if it was Mr W’s intent to convert the van into a campervan, he wouldn’t be using it for transport contracts, nor would he be transporting his work equipment in it. However, as the amount of credit provided was under £25,000, I’m satisfied the agreement was regulated, which means we are able to investigate complaints about it. Mr W and our investigator have both referenced the Consumer Rights Act 2015 (‘CRA’) in relation to this complaint. But, as I’m satisfied Mr W entered into the agreement predominantly for business purposes, he wasn’t acting as a consumer. So, the CRA doesn’t apply here. Instead, the Sale of Goods Act 1979 (‘SGA’) is relevant to this complaint. Similar to the CRA, the SGA implies a term into the contract that the van Close Brothers supplied to Mr W should have been of a satisfactory quality. The SGA explains satisfactory quality is what a reasonable person would expect, taking into account any relevant circumstances. I would consider relevant circumstances here to include things, amongst others, like the van’s age, price, mileage, and description. So, if I thought the van was faulty when Mr W took possession of it, and this made the van not of a satisfactory quality, it’d be fair and reasonable to ask Close Brothers to put this right. In this instance, it’s not disputed there is a severe oil leak on the van, nor that this fault was developing when it was supplied to Mr W. As such, I’m satisfied that I don’t need to consider the merits of this issue within my decision. Instead, I’ll focus on what remains in dispute. Mr W has denied any responsibility in relation to the van being collected for repair. While his comments have been noted, I don’t think the reasons why the van wasn’t collected, and who is responsible for this, is relevant to the complaint. And I’ll explain why.

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It’s not disputed the van wasn’t collected when it should’ve been. However, Close Brothers have already agreed to refund the payments Mr W paid from when the van broke down to when repairs are completed. As such, by their actions, they have accepted at least some liability for this and are prepared to ensure Mr W hasn’t been making payments for a van he was unable to use. And I think this is more than reasonable. So, why the van wasn’t collected has any bearing on what needs to be done to put things right. While I accept that the van was seized by the DVLA after it wasn’t collected when agreed, there is no direct causation between these events. The van was seized because Mr W completed a SORN and then, unknowingly or not, parked the van on a public highway in direct contravention to the requirements of the SORN. In declaring the van to be off the road, Mr W was responsible for ensuring that the van was not parked on a public highway. And, if he was unable to store the van somewhere that didn’t contravene the SORN, then he should’ve ensured the van was correctly taxed and insured. In taking the actions he did, and again I accept he did this unknowingly – ignorance isn’t considered a defence under UK law - Mr W was not only in breach of the agreement he signed with Close Brothers, he was also responsible for the charges applied by the DVLA. It’s therefore reasonable that Close Brothers ask him to reimburse the costs they paid to recover the van. And they are entitled to deduct these costs from any remedy paid. Turning now to the timing belt, I’ve seen the health check carried out by the garage recommended a replacement timing belt due to the age and mileage of the van. However, they didn’t say that the existing timing belt was failing or had failed and therefore needed replacement. This is also the case with the independent engineer – while they said the original timing belt was still fitted to the van, they didn’t say it needed replacement. As there’s nothing to show me the timing belt has failed or is failing, this becomes a maintenance issue, for which Mr W is responsible, not Close Brothers. I’ve noted Mr W’s comments, when he said the dealership advised him that the timing belt had been changed. So, I’ve considered section 56 of the Consumer Credit Act 1974 (‘CCA’). This states that any negotiations conducted by the credit broker or supplier of goods are deemed to be conducted in the capacity of an agent of the creditor, and that this includes all communications (including the advert) and representations made. While this means that any discussions, communication, or representations made by the dealership in respect of the timing belt were done so as an agent of Close Brothers, I haven’t seen anything to show me that the van was ever advertised as having a replacement timing belt. And there’s nothing in the correspondence from the dealership that shows Mr W was ever told this was the case. So, and while I appreciate this will come as a disappointment to Mr W, I’m not satisfied the van was misrepresented. So, I won’t be asking Close Brothers to cover the cost of the timing belt replacement. However, as suggested by the investigator, as Close Brothers are arranging for the repair to the oil leak, it may be possible for the timing belt to be replaced at the same time, and the cost of this, at least in part, covered by the refund of payments Close Brothers would otherwise have paid. If Mr W wants to do this, I suggest he speak to Close Brothers about it separately, but it won’t form part of my overall decision. Finally, Mr W has also expressed his dissatisfaction with the service he received from the dealership, both when he collected the van and afterwards. While section 56 of the CCA does hold Close Brothers liable for some of the actions of the dealership, this doesn’t extend to their general customer service. So, if Mr W remains unhappy with the service from the dealership, this is something he would need to raise with them directly.

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Putting things right If they haven’t already, Close Brothers should: • arrange to repair the oil leak, and any subsequent damage to the van resulting from this leak, at no cost to Mr W; • as offered, cover the costs of an MOT as a gesture of goodwill; • refund the payments Mr W has paid from 31 July 2025 to when the van is returned to him after repair (Close Brothers are entitled to deduct any DVLA seizure associated costs from the amount of this refund); • apply 8% simple yearly interest on the refunds, calculated from the date Mr W made the payment to the date of the refund†; and • pay Mr W an additional £500 to compensate him for the trouble and inconvenience caused by being supplied with a van that wasn’t of a satisfactory quality (Close Brothers must pay this compensation within 28 days of the date on which we tell them Mr W accepts my final decision. If they pay later than this date, they must also pay 8% simple yearly interest on the compensation from the deadline date for settlement to the date of payment†). †If HM Revenue & Customs requires Close Brothers to take off tax from this interest, they must give Mr W a certificate showing how much tax they’ve taken off if he asks for one. My final decision For the reasons explained, I uphold Mr W’s complaint about Close Brothers Limited trading as Close Brothers Motor Finance. And they are to follow my directions above. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr W to accept or reject my decision before 8 April 2026. Andrew Burford Ombudsman

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