DRN-6294360

The complaint X complains that AMERICAN EXPRESS SERVICES EUROPE LIMITED (AESEL) rejected a claim under section 75 Consumer Credit Act 1974 (s.75). What happened In August 2024 X purchased a table and accompanying bench from a merchant paid for with a credit card from AESEL. Some five months after delivery the table developed a sizable crack. X notified the merchant and it sent a technician to inspect the table. He noted: “Inspected only - repair was unsuccessful Where is the issue: large wooden dining table What is the issue: reported issue there is a large crack up the table How did this happen: manufacturers defect……the split is right through the timber What the technician has done: fully inspected and photographed only. This is not a surface crack the timber is completely split so to resin fill would not work What could be done: we could attempt to resin fill the crack but there are no guarantees (120 min)” The merchant said the manufacturer proposed that the table be repaired despite the findings of the technician. X said the table should be replaced as required under consumer law. No agreement was reached and X brought the matter to the attention AESEL. It considered a claim under s.75 and concluded the merchant had not been provided the opportunity to repair the table and so it declined the claim. A complaint was brought to this service where it was considered by one of our investigators who recommended it be upheld. He concluded the table had developed a fault within six months and this had constituted a breach of contract. This entitled X to a repair or replacement. Given the technician said a repair would not work he recommended the table be replaced. He added that AESEL should pay X £150 compensation. AESEL said it could not arrange for the table to be replaced. It explained that it was a financial institution with no ability to direct the merchant to replace the table. It offered to refund the cost plus any associated costs covering the disposal of the table. X did not consider that to be acceptable since the cost of a replacement table had increased significantly. As no agreement could be reached the matter has been passed to me. I issued a provisional decision as follows: “I’ve considered all the available evidence and arguments to decide what’s fair and

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reasonable in the circumstances of this complaint. When the evidence is incomplete, inconclusive or contradictory as some of it is here – I’ve reached my outcome on the balance of probabilities – that is, what I consider likely to have happened given the available evidence and the wider circumstances. I want to acknowledge that I’ve summarised the events of the complaint. I don’t intend any discourtesy by this – it just reflects the informal nature of our service. I also want to assure X and AESEL that I’ve reviewed everything on file. If I don’t comment on something, it’s not because I haven’t considered it. It’s because I’ve concentrated on what I think are the key issues. Our powers allow me to do this. I should make it clear that the role of the Financial Ombudsman Service is to resolve individual complaints and to award redress where appropriate. I do not perform the role of the industry regulator and I do not have the power to make rules for financial businesses or to punish them. The technician established there was a manufacturing fault with the table and this was accepted by the merchant. However, it didn’t accept that the table could not be repaired despite its own technician’s conclusions to the contrary. I suspect the manufacturer did not feel obliged to follow the advice of the technician. I agree with our investigator that it has been established that the table is faulty and that a repair is inappropriate. He set out the reasoning in the view he issued and I will not repeat that here given all parties accept his conclusions on those matters. The issue which is in dispute is the remedy. X acquired a table and matching bench and is left with a table which is not fit for purpose. X wishes to be put back in the position she was in before the fault arose. As of December 2025 the table was being sold by the merchant with a price of £2,279. Legislation Consumer Rights Act section 23 Right to repair or replacement (1) This section applies if the consumer has the right to repair or replacement (see section 19(3) and (4)). (2) If the consumer requires the trader to repair or replace the goods, the trader must— (a) do so within a reasonable time and without significant inconvenience to the consumer, and (b) bear any necessary costs incurred in doing so (including in particular the cost of any labour, materials or postage). (3) The consumer cannot require the trader to repair or replace the goods if that remedy (the repair or the replacement)— (a) is impossible, or (b) is disproportionate compared to the other of those remedies. (4) Either of those remedies is disproportionate compared to the other if it imposes costs on the trader which, compared to those imposed by the other, are unreasonable, taking into

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account— (a) the value which the goods would have if they conformed to the contract, (b) the significance of the lack of conformity, and (c) whether the other remedy could be effected without significant inconvenience to the consumer. (5 )Any question as to what is a reasonable time or significant inconvenience is to be determined taking account of— (a) the nature of the goods, and (b) the purpose for which the goods were acquired. (6) A consumer who requires or agrees to the repair of goods cannot require the trader to replace them, or exercise the short-term right to reject, without giving the trader a reasonable time to repair them (unless giving the trader that time would cause significant inconvenience to the consumer). (7) A consumer who requires or agrees to the replacement of goods cannot require the trader to repair them, or exercise the short-term right to reject, without giving the trader a reasonable time to replace them (unless giving the trader that time would cause significant inconvenience to the consumer). (8) In this Chapter, “repair” in relation to goods that do not conform to a contract, means making them conform.” S. 23 has effect where s. 19 applies i.e. “If the goods do not conform to the contract because of a breach of any of the terms described in sections 9, 10, 11, 13 and 14, or if they do not conform to the contract under section 16, the consumer's rights (and the provisions about them and when they are available) are— (a)the short-term right to reject (sections 20 and 22); (b)the right to repair or replacement (section 23); and (c)the right to a price reduction or the final right to reject (sections 20 and 24).” The goods do not conform and therefore X is entitled to right of repair or replacement. The merchant wishes to effect a repair, but its own technician has confirmed this is not possible. So, it follows that repair is not an option which is available in this situation. A repair would not make the table conform as required by subsection 8 above. This leaves replacement as the only remedy. Ideally the merchant would have replaced the table but it has chosen not to do so. In those circumstances X is entitled to turn to AESEL and make a claim under s.75 “75 Liability of creditor for breaches by supplier. (1) If the debtor under a debtor-creditor-supplier agreement falling within section 12(b) or (c) has, in relation to a transaction financed by the agreement, any claim against the supplier in respect of a misrepresentation or breach of contract, he shall have a like claim against the creditor, who, with the supplier, shall accordingly be jointly and severally liable to the debtor.”

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That means that X has a like claim against AESEL and is entitled to the redress which should have been provided by the merchant. So, as I have explained above I believe X is entitled to a replacement table. This can be brought about in two different ways. Either AESEL can prevail upon the merchant to effect a replacement or it can provide X with the funds to enable her to replace the damaged table with a new one. Ideally as a result of my proposed decision the merchant will act on a request from AESEL and I think it prudent to bear in mind s. 75 (2) “Subject to any agreement between them, the creditor shall be entitled to be indemnified by the supplier for loss suffered by the creditor in satisfying his liability under subsection (1), including costs reasonably incurred by him in defending proceedings instituted by the debtor.” I am mindful that X holds a damaged table which should be returned to the merchant and if there are any costs related to its disposal these should be met by AESEL. If that is not possible and X is able to sell it then I consider she should keep any proceeds given the inconvenience this would likely cause.” X accepted my provisional decision on the understanding that she should not be left without a dining table at any stage and the remedy would be arranged without any additional burden on her. AESEL asked what the current cost of the table would be and our investigator said the merchant was currently showing it as £1,935 on its website. It said it accepted a settlement of £1,935 plus £150 and agreed to cover the cost of removal of the table subject to X providing a receipt. It said payment would be issued by cheque and it had 28 days to do so after the final decision was issued by this service. It went on to say that X would receive the cheque within 15 business days. 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. I am pleased that both parties broadly accept my proposed resolution, but seem to wish to add caveats. It is regrettable that they feel the need to do so. I cannot say that the replacement of the table will not add some additional burden to X nor that there might be a period where she is without a table. I would hope that the process goes as smoothly as possible. Nor can I accept that AESEL should pay £1,935 for the replacement table. The price may change. It is currently shown on the merchant’s website as reduced to £1,935 from £2,270. Given AESEL will not arrange for the merchant to replace the table the solution would be for X to order a new table and for AESEL to refund the cost once evidence of the purchase is provided. This should be done without delay by either party. I do not expect AESEL to unreasonably delay making the payment. I leave it to X to decide what to do with the current table and if she incurs a cost in disposing of it this should be covered by AESEL on the production of a receipt. If she chooses to sell it then she may keep the proceeds, but AESEL would not be responsible for any disposal costs. Putting things right AESEL should: • Cover the cost of a new table after X has provided evidence of the sum she has incurred. This should be done without delay.

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• Cover the cost of the disposal of the existing table, if X chooses to dispose of it. If she chooses to sell it then any profit can be kept by her and AESEL would not be responsible for any costs. • Pay X £150 compensation. My final decision My final decision is that I uphold this compliant and I direct AMERICAN EXPRESS SERVICES EUROPE LIMITED to put things right as set out above. Under the rules of the Financial Ombudsman Service, I’m required to ask X to accept or reject my decision before 14 May 2026. Ivor Graham Ombudsman

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