Lenders gain partial win in motor finance marathon

The legal battle over motor finance commissions has resulted in a partial victory for lenders: in two of three conjoined cases, the Supreme Court ruled that credit brokers owed no fiduciary duties to customers. Yet the Court's finding of an unfair relationship in the other claim may still expose firms to substantial payouts. Adam Samuel examines the judgment and its loose ends.

The Supreme Court's decision in Hopcraft v Close Brothers, [1] issued after the markets closed on Friday 1 August, puts to bed a string of cases going back to 2007 about whether lenders and credit brokers who have not disclosed commission passing between them automatically owe it to their customers. At the same time, though, the case shows how high undisclosed commissions can and perhaps will typically render credit bargains unfair under the Consumer Credit Act (CCA) and result in the return of the commission paid.