Published September 11, 2018
Law firm M1 Legal has set up an action group to support consumers following a decision in the Royal Courts of Justice (RCJ) which brings fresh hope to thousands of timeshare holders in the UK.
It follows a ruling by Judge Timothy Herrington sitting in the Upper Tribunal of the RCJ that states weight must be given to consumer detriment when making a decision against Clydesdale Financial Services affecting 1,444 regulated credit agreements worth £47million.
A spokesperson for M1 Legal who specialises in timeshare contract law, Adriana Stoyanova, said: “This is a landmark ruling that could open up the floodgates for European Consumer Claims.”
CFS trades as Barclays Partner Finance (BPF) whose parent company is Barclays Bank PLC.
An appeal was referred to the Upper Tribunal after a decision for a Validation Order for BPF by the Financial Conduct Authority was referenced (appealed) by 45 timeshare holders.
Judge Herrington was asked to remit the Validation Order granted in favour of BPF back to the FCA – after it was opposed by the 45 borrowers.
The tribunal was told the credit agreements financed the acquisition of timeshare accommodation from a group of companies called Azure totalling £47million. They were brokered by an unauthorised broker in breach of the Financial Services and Markets Act 2000.
In February the FCA issued the Order, allowing BPF to retain any money paid to them under the agreements, arguing they did not intentionally contravene the requirements. They said the effect on borrowers would have been no different, even if the broker had been authorised.
The 45 borrowers submitted allegations including that they were pressurised into signing, false representations were made, they had been misled, as well as concerns about the agreements and credit assessments.
At the time of the FCA issuing the Order, BPF had not submitted evidence regarding consumer detriment. It was only after appeals were received opposing the Order that the FCA became aware of the issue of consumer detriment.
The FCA and the borrowers asked the Tribunal to remit the matter back to the FCA to reconsider with a direction to take consumer detriment into consideration.
BPF contested the Order should not be unwound.
In his ruling, Judge Herrington said: “I have found that there is evidence of potential consumer detriment, albeit unsubstantiated at this stage, most of which was not taken into account by the Authority in making its decision to issue the Validation Order.”
He added that consumer detriment was a relevant factor and directed the FCA to take it into account when reconsidering its decision.
M1 Legal is an expert team of international lawyers and legal assistants at the forefront of timeshare legislation knowledge to help consumers who have bought timeshare properties abroad and feel they have been misrepresented. Following the tribunal ruling, Adriana Stoyanova said M1 Legal had formed an action group to support Azure timeshare consumers who feel they have been misrepresented.