Each party acted in its own interest and were not expected to show loyalty to the customer, the ruling said.
But in one of the three cases, judges said the consumer should be compensated as he was treated unfairly as per the Consumer Credit Act.
In that case, the consumer, Marcus Gervase Johnson, had his claim upheld for specific circumstances including the large size of the commission paid by the bank to the car dealer, and that the documents he was provided with upon sale of the vehicle were designed to create a false impression of terms offered by lenders.
“Mr. Johnson was commercially unsophisticated, and the court questions the extent to which a finance company could reasonably expect a customer to have read and understood the detail of such documents, particularly when no prominence was given to the relevant statements. For these reasons, the court holds that [the] relationship between Mr. Johnson and the finance company was unfair, and that the finance company should pay the amount of the commission to Mr. Johnson with interest at a commercial rate from the date of the agreement,” said Reed.
“Other customers’ claims are rejected.”
Some commission and compensation may still be payable to consumers, after this one case was broadly successful, but champagne is likely to be popping in the City of London considering some analysts put potential payouts for lenders as high as £44 billion.