Mitsubishi HC Capital UK PLC · DRN-6151901

The complaint Mrs Q has complained about the charges that Mitsubishi HC Capital UK PLC trading as Novuna Vehicle Solutions (NVS), applied when she handed back a car she had acquired under a hire agreement. When I refer to what Mrs Q and/or NVS have said and/or done, it should also be taken to include things said and/or done on their behalf. What happened In April 2022, Mrs Q entered into a hire agreement with NVS to acquire a new car. The agreement had an initial rental of £808.45 followed by 35 rentals of £269.48. The car was delivered nearly about a year later on 8 March 2023 and her direct debit payments started on 28 April 2023. Mrs Q understood that the three-year agreement started in April 2022, so would end in April 2025. On 27 January 2025 Mrs Q emailed and asked NVS when her agreement was ending and, on 29 January 2025, they have replied telling her the hire agreement’s end date was 5 March 2026. On that same day Mrs Q wrote back to them asking if she would be able to extend for one month until her new car arrived. NVS replied stating that the agreement would automatically roll over after 5 March 2026 into a secondary hire period for up to 12 months. In February 2025, Mrs Q paid a deposit on another car, and, at the beginning of March 2025, she emailed VHS to arrange for her car under the agreement with her to be collected. The car was collected mid-March 2025 and on 25 March 2025, NVS sent an email to her stating that an early termination a fee of 50% of remaining rentals would apply. In this correspondence they confirmed £1,676.24 was payable. Mrs Q raised a complaint with them, as she believed that her agreement ran from three years from when signed and, she said, she was not informed otherwise. On 23 May 2025, NVS wrote to Mrs Q. They said her hire agreement indicated that the hire period and her obligation to make payments will not start until the car is delivered and that the minimum period of hire, 36 months starts on the date of delivery of the car. NVS also said that shortly after Mrs Q’s lease car was delivered, they sent her an email on the 14 June 2023 which confirmed her lease agreement had started on the 6 March 2023 and also included payment and collection date information. As such, NVS said they are not at fault for collection of early termination fee relating to Mrs Q’s hire agreement. They said they explained on several occasions when her lease agreement was due to end, and they followed the terms of the lease agreement correctly. They said Mrs Q was responsible for £1,616.90 early termination, £57.26 for excess mileage and £2.08 for road fund licence. Mrs Q was unhappy with NVS’s response, as such she brought her complaint to Financial Ombudsman Service (Financial Ombudsman).

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Our investigator was of the opinion that it was reasonably clear that the minimum period of the agreement starts on the delivery of the car, however, they though that NVS could have done more to provide the information Mrs Q needed, so that she could make her decision. As such, the investigator thought that NVS should award Mrs Q £200 compensation. Mrs Q did not accept the investigator’s outcome. As such, the complaint has been passed to me to decide. After reviewing the case, I issued a provisional decision on 10 February 2026. In the provisional decision I said: ‘‘What I’ve provisionally 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. Where evidence is unclear or in dispute, I reach my findings on the balance of probabilities – which is to say, what I consider most likely to have happened based on the evidence available and the surrounding circumstances. In considering what is fair and reasonable, I need to take into account the relevant rules, guidance, good industry practice, the law and, where appropriate, what would be considered good industry practice at the relevant time. Mrs Q acquired the car under a hire agreement, which is a regulated consumer credit agreement. Our service can look at these sorts of agreements. I have summarised this complaint very briefly, in less detail than has been provided, and largely in my own words. No discourtesy is intended by this. If there is something I have not mentioned, I have not ignored it. I have not commented on every individual detail. But I have focused on those that are central to me reaching, what I think is, the right outcome. This reflects the informal nature of the Financial Ombudsman as a free alternative to the courts. In this decision I can only consider actions/inactions of NVS, and only the aspects they are responsible for and the ones that they have had an opportunity to address. As such, I cannot look at certain actions and/or inactions which Mrs Q might be unhappy about. In this decision I only focused on the aspects I can look into, and only the events that have been raised by Mrs Q with NVS, and the ones that happened by 23 May 2025, and only the ones NVS had the opportunity to address in their final response issued on that date. Mrs Q said she unhappy that NVS asked her to pay an early termination fee because she believed that her agreement term ran for three years from the time she signed the paperwork. And I know Mrs Q is unhappy about the amount she was asked to pay as an early termination fee. The Consumer Credit Act 1974 (CCA) sets out the rights consumers have to voluntary terminate their finance agreements and the liability that is due on termination. Under clause 101 of the CCA, a consumer has a right to voluntary terminate a hire agreement by giving notice, however, this regulation does not apply to agreements where the hirer is required to make payments exceeding £1,500 in a year. Mrs Q, under her hire agreement, was required to pay more than £1,500 a year. As such, Clause 101 of the CCA does not apply to her circumstances. Following this, I considered what her hire agreements sets out. From clause 6 on Mrs Q’s hire agreement, I can see that Mrs Q may end the hire of the car anytime prior to the end of the minimum hire period by paying NVS the amount calculated in accordance with clause 7.2.

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7.2 explains that upon termination under clause 6, Mrs Q shall pay NVS: ‘‘(a) all arrears of rental and interest and any other sums due and unpaid at the date of termination; and (b) immediately on termination a sum equal to 50% of remaining monthly Rental payments which would have fallen due during the Minimum Hire Period but for earlier termination.’’ I can also see that under ‘‘Rentals’’ her agreement states that her minimum period of hire, 36 months, will start on the date of the delivery of the car. Also, clause 1.2 states that the agreement becomes legally binding on the date on which it is signed, but the minimum hire period will not start until the car is delivered to Mrs Q. Mrs Q’s first direct debit payment was taken after the delivery of the car and, following this, NVS emailed Mrs Q in April 2023 advising that the direct debits were due to start, quoting the car registration date as 6 March 2023 and indicting this date as the agreement start date. Also, when Mrs Q enquired about the end date of the agreement, NVS did confirm that it was in 2026. Considering all the circumstances of this complaint, I think most likely Mrs Q would have known that the agreement starts when the car is delivered to her. Next, I considered the terms and conditions of her hire agreement to decide if the amount she is being asked to pay is fair and reasonable. And as I quoted above, I can see that Mrs Q’s hire agreement under clause 6 ‘‘Termination of Hire’’ says that she may end the hire of the car anytime prior to the end of the minimum hire period by paying NVS the amount calculated in accordance with clause 7.2. Clause 7.2 says that, immediately on termination, Mrs Q would be responsible for a sum equal to 50% of remaining monthly rental payments which would have fallen due during the minimum hire period but for earlier termination. NVS charged £1,616.90 which is 50% of the remaining 12 months of the agreement. As such, it was not unreasonable for them to request this money from Mrs Q. I also considered the excess mileage charge that Mrs Q was being asked to pay. Her agreement under clause 6.2 refers to clause 9. Clause 9 explains that if the car is returned before or after the end of the minimum hire period the total allowed mileage will be calculated monthly on a pro rata basis and Mrs Q will have to pay excess mileage charges at the rate specified in the agreement. The agreement specifies that excess mileage will be charge at 9.06 pence per mile (including VAT). The total allowed mileage was 24,000 miles (8,000 miles per year). When the car was collected there was 12 months left, as such Mrs Q would be responsible for any mileage over and above 16,000 miles. The mileage on the car at collection was 16,651 and, once the delivery mileage was taken into account, a charge of £57.26 was issued to Mrs Q. I believe that the all the clauses I referred to above are explained to a sufficient extent that a reasonable person would understand and Mrs Q signed the agreement agreeing to be bound by them. As such, I do not think NVS has applied any unfair charges when Mrs Q exited the agreement early. I did consider if NVS should have provided Mrs Q with an early termination quotation before the car was collected shortly after she requested that collection so that she could make an informed decision. However, I can see that NVS sent out anniversary emails to Mrs Q, in which they said that they understand that sometimes unexpected events happen, which could result in Mrs Q needing to end her contract early. These communications explained that the early termination fee is 50% of the outstanding rentals. It also said that to request a quote to terminate the agreement early, she should contact them, and they have provided an email address for this. As such, I think most likely, Mrs Q would have known that if she

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decided to terminate her agreement earlier, she would need to pay 50% of the outstanding rentals. This is also covered by her hire agreement terms and conditions. Therefore, I think Mrs Q had enough information to make an informed decision. While I sympathise with Mrs Q for the difficulties that she is experiencing, taking all the circumstances of the complaint into account, it is not fair or reasonable for me to require NVS to take any further action in response to Mrs Q’s complaint. I remind NVS that if Mrs Q is not able to make a payment to them due to her financial situation, NVS should work with her to arrange an affordable plan for her. One that allows her to repay the money due in a reasonable amount of time or in a way that is sustainable (a plan that takes her circumstances into account and is realistic, affordable and one that leaves her with sufficient disposable income to account for other bills and contingencies). my provisional decision For the reasons given above I intend to say that I do not uphold this complaint.’’ I asked both parties to provide me with any additional comments or information they would like me to consider by 24 February 2026. NVS accepted my provisional decision. Mrs Q provided further comments. 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. Following my provisional decision, in summary, Mrs Q said that had she been informed in advance that an early termination fee would be applied, she would most definitely have kept the car and continued with the agreement. She said the absence of any prior notification removed her ability to make an informed decision and caused clear financial detriment. She feels that this raises serious concerns around transparency, fair treatment, and compliance with consumer credit and FCA principles, particularly the requirement for firms to communicate charges clearly and in good time, allowing customers to make informed choices. And Mrs Q feels that NVS have not acted fairly and in line with their regulatory obligations by failing to disclose the early redemption fee to her, prior to the collection of the car. I thought about what Mrs Q has said but, as I mentioned in my provisional decision, I had already considered whether NVS should have provided Mrs Q with an early termination quotation shortly after she requested that collection and before the car was collected, so she could make an informed decision. And, as I explained, NVS sent out anniversary emails to Mrs Q, in which they said that they understand that sometimes unexpected events happen, which could result in Mrs Q needing to end her contract early. From those communications Mrs Q would have seen that the early termination fee is 50% of the outstanding rentals. In addition, these communications explained to Mrs Q that to request a quote to terminate the agreement early, she should contact them, and they have provided an email address for this. As such, I think most likely, Mrs Q would have known that if she decides to terminate her agreement earlier, she would need to pay 50% of the outstanding rentals. In addition, this is also covered by her hire agreement’s terms, so I think Mrs Q had enough information to make an informed decision.

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I sympathise with Mrs Q for the difficulties that she is experiencing, but as I explained above and in my provisional decision, it is not fair or reasonable for me to require NVS to take any further action in response to Mrs Q’s complaint. My final decision For the reasons given above, and in my provisional decision, I do not uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mrs Q to accept or reject my decision before 16 April 2026. Mike Kozbial Ombudsman

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