While the sector awaits the Supreme Court’s much-anticipated judgment on motor finance commissions, a significant High Court ruling has already laid new legal ground in CMC led mass consumer complaints.

In Vanquis Bank Limited v TMS Legal Limited [2025] EWHC 1599 (KB), handed down in late June, the High Court refused to strike out a lender’s legal claim against a solicitor-led CMC accused of submitting over 33,000 affordability complaints – many allegedly without merit or proper due diligence. It is the first time the economic tort of causing loss by unlawful means has been allowed to proceed in this context.

The case does not yet determine liability but the judgment signals a potentially major shift in how lenders, brokers and funders may be able to respond to speculative, volume-driven complaint activity.

TMS Legal, a claims management company regulated by the Solicitors Regulation Authority (SRA), began submitting large volumes of affordability complaints against Vanquis Bank from late 2023. By August 2024, over 33,000 complaints had been filed with more than 12,000 escalated to the Financial Ombudsman Service (FOS). Of those, around 84% were either rejected or withdrawn. Vanquis contends that many of these claims were either out of time or clearly unarguable and that only a very small number were upheld – most only in part.

Vanquis responded by issuing legal proceedings, claiming that TMS had submitted complaints without proper client instructions, insufficient factual basis and in breach of its legal and ethical duties. These included the duty to act in the best interests of clients, to assess the merits of each claim and to ensure complaints were properly authorised and evidence based.

Among Vanquis’s more serious allegations were claims that TMS:

• made reckless or misleading representations to clients about the merits of their cases
• relied on generic or inadequate questionnaires rather than case-specific information
• encouraged clients to sign declarations to artificially satisfy the three-year time limit under FOS rules
• used unqualified staff under minimal supervision to process and file complaints at scale.

Vanquis argued that this behaviour amounted to a commercial strategy focused on quantity over quality – one that damaged both its business operations and its customer relationships.

TMS applied to have the claim struck out or dismissed via summary judgment, arguing that the tort of causing loss by unlawful means could not be applied to this type of commercial dispute between a lender and a CMC.

In simple terms, this tort allows a business to claim damages when another party intentionally harms its interests by unlawfully interfering with a third party – in this case, TMS’s own clients. Vanquis alleges that TMS acted unlawfully by breaching duties owed to those clients, including the duty to act in their best interests, as set out in the SRA’s Guidance on Claims Management Activity (updated July 2024). That breach, it argues, caused direct harm to Vanquis.

Mr Justice Jay rejected TMS’s position. He acknowledged that while the case was novel, the allegations – if proven – could amount to “egregious conduct” and that there was no legal reason in principle why the tort could not apply in this context.

He concluded that Vanquis’s case was strong enough to proceed to trial, noting that:
“TMS had no idea which claims would succeed and did not care.”

The ruling is careful not to pre-judge the final outcome. But it does confirm that a lender’s legal challenge to mass, meritless complaint activity can survive first-stage scrutiny – an outcome that many in the industry will welcome.

The decision provides a possible new route for lenders and brokers to challenge complaint behaviour that exceeds reasonable conduct. While most firms handle customer complaints responsibly, there is growing concern in the sector about industrialised complaint practices, particularly where complaints are:

• submitted at high volume with little or no case-specific evidence
• unsupported by clear client understanding or instruction
• focused primarily on creating commercial leverage rather than consumer redress.

Until now, lenders have largely been limited to the FOS, FCA and SRA when reporting this type of activity. This judgment opens the door to a potentially powerful legal remedy, particularly in cases where significant operational harm, resource drain or reputational damage can be demonstrated.

The tort of causing loss by unlawful means may not be appropriate in every case and it is highly fact-specific. This ruling shows that courts are willing to entertain such claims – especially where a CMC’s actions appear systematic, reckless or misleading.

This ruling comes at a pivotal time. As CMC and SRA-regulated firm activity increases across the credit landscape – particularly in motor finance – firms need to be vigilant.

The High Court was clear: this decision does not mean Vanquis will succeed at trial. But it does mean that lenders now have a credible legal pathway to pursue when facing high-volume complaint activity that crosses the line from advocacy to abuse.

Firms should take this opportunity to:

• review CMC submissions for patterns of concern
• ensure robust internal triage, audit and complaints governance is in place
• engage early with legal and compliance teams where material complaint risk is identified
• report concerning behaviours to the relevant regulators (FCA, SRA or FOS) as appropriate.

The days of reckless complaint volume being seen as untouchable may be coming to an end. This case will be closely watched in the months ahead – and could help shape the standards expected of both claims firms and those who respond to them.