Know your rights
Your rights depend on:
- what sort of sale it was, such as layby or a gift voucher, on order for delivery or a credit sale
- whether the business is sold and the new owners are willing to honour claims as a matter of customer goodwill
- if the business was a registered company or a sole trader/partnership.
If you hear any news about a company in difficulty, check:
- the companies register – takes up to 10 days to be updated
- public notices on the Insolvency and Trustee website – also includes notices about traders in financial difficulty.
Pay up quickly for any layby sale and collect the item if you see the business is having a closing down sale!
You can complete a claim form, which the receiver or liquidator will provide or will be available on their websites. You may need to provide evidence such as receipts, serial numbers, bank statements, copies of vouchers or credit notes.
If it is sold, the new owners may not have purchased the previous owner’s liabilities. This means they don’t have to:
- honour gift vouchers issued by the previous owner
- complete orders placed with the previous owner that have not yet been delivered
- repair faulty products sold by the previous owner.
If the business was not a registered company then the trader will be personally responsible for returning your money or products. You are an unsecured creditor. You can try to claim your money or products back from the Disputes Tribunal or District Court.
Gift vouchers or credit notes you haven’t used yet
Receivers, liquidators or any new owners don’t have to accept gift vouchers or credit notes. This is because both a gift voucher and a credit note are the previous owner’s responsibility. It is unlikely that you will get any money back as an unsecured creditor.
Products on layby
Specific rules under the Fair Trading Act give you some protection, as long as you have not missed a payment within the last three months and the products are still there. You will have to claim back your money from the receiver or liquidator if the products aren’t there. You still have priority over other unsecured creditors for the value of amounts already paid. If you have missed payments, you have none of the rights set out above and you probably will not get your money back.
Read Gift vouchers and laybys to find out more.
Products on order or deposit paid
You are an unsecured creditor when a business closes. Contact the receiver or liquidator if the business is a company in receivership or liquidation to see if you can get your products or money back, but you probably won’t be able to.
Products you have bought on credit
Finance on credit sales will usually be done through a finance company separate from the retailer. You will still have to make the payments to the finance company, but you won’t be at any risk of losing your products becuase you already have them.
Read Cancelling your credit contract to find out more.
Faulty products or services
You will have to claim under the manufacturer’s warranty or contact the manufacturer directly to make a claim under the Consumer Guarantees Act. However, your rights are more limited than with a supplier. Your rights depend on the warranty.
If the business is a registered company under administration you can contact the receivers or adminstrators to pursue your rights for faulty products or services under the Consumer Gurantees Act. This may be difficult.
You may have other rights under an extended warranty that you purchased. Contact the insurance provider listed in your extended warranty documents.
Any faulty products that are in for repairs currently with the trader are still your property and you should get them back even if not repaired.
You also can go back to the lender for faulty products bought on finance if the lender arranged the loan for the products. They are also responsible for the quality guarantees under the Consumer Guarantees Act and have the same obligations as the supplier.