CAR finance mis-selling took an unexpected turn last Friday.

While claims management companies (CMCs) prepared for a bumper bonanza – their fees could have topped a third of the £44 billion claims bill – fate had other plans.

Last October, the English Court of Appeal held that car sales firms couldn't lawfully receive commission from finance companies unless they had the customer's "fully informed consent".

On Friday, the UK Supreme Court (UKSC) gave its ruling in the three linked appeal cases of Hopcraft, Johnson and Wrench. It decided car firms didn’t owe their customers a fiduciary duty when arranging car finance.

A fiduciary duty is a legal obligation to act in someone’s best interests – like a trustee would owe to a beneficiary or a director owes to a company.

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© Evening Times