Credit card refunds administration claims

If you’ve ordered goods from a company that then goes into administration – such as Jessops – what are your consumer rights, and how do you get a refund for undelivered goods?

Jessops went into administration this week, and ceased all trading yesterday. Customers who had ordered and paid for products were informed that Jessops would not be sending out orders or issuing refunds. Music and related tech retailer HMV swiftly followed. Neither will be honouring gift vouchers.

How do you get a refund for items bought from a company that goes into administration?

Administrators PWC have a page of information for Jessops customers, which states “Customers who have ordered and paid for all or part of their stock either in store or online will not receive their stock purchase.”

PWC correctly point Jessops customers to their credit card companies if they paid using one.

“Customers who have paid using credit cards should contact their credit card company to try and seek resolution to this matter.”

This is your best and quickest route to a refund from a company that’s gone into administration.

Money Savings Expert has some excellent advice about claiming refunds through your credit card company.

You need to claim under Section 75 of the Consumer Credit Act, which legally makes credit card companies equally liable for claims if there’s a breach of contract (eg. goods paid for but not delivered) or misrepresentation.

Legal bit: “(1) If the debtor under a debtor-creditor-supplier agreement falling within section 12(b) or (c) has, in relation to a transaction financed by the agreement, any claim against the supplier in respect of a misrepresentation or breach of contract, he shall have a like claim against the creditor, who, with the supplier, shall accordingly be jointly and severally liable to the debtor.”

Money Saving Expert neatly sums up Section 75: "Pay for something costing between £100 and £30,000 on a credit card and the card issuer's equally liable if something goes wrong."

This credit card protection applies for the whole thing even if you pay for only a part of it on the card – provided what you pay for costs more than £100.

It provides cover for purchases even if they’re from outside of the UK or via a foreign website.

Section 75 applies to credit cards and store cardsonly, not orders paid for with debit cards, cash or cheques.

How to claim for a refund through a credit card company

Call your credit card company as soon as possible. Most can be contacted Monday to Friday in normal business hours. Check through your card provider’s website.

You need to contact the credit card provider – eg. Barclaycard, HSBC, NatWest, etc – not Visa, Mastercard or Amex direct.

Be firm. Refer specifically to Section 75 of the Consumer Credit Act, and it should respond by sending you a claim form.

If the credit card company tries to fob you off by telling you to claim the refund through the administrators remain firm that you are making a claim under Section 75 and that you know your rights are protected through the credit card company being equally liable.

If it continues to refuse a legitimate claim you need to contact the Financial Ombudsman to make a complaint.

Customers unable to obtain a refund through their credit card company and people with now invalid Jessops gift vouchers are pointed to a creditor claim through the administrators.

This type of non-credit-card claim is unlikely to be successful, however, for ordinary customers, with larger corporate creditors first in line for compensation.

PWC is realistic about such claims: “If you are owed money by Jessops (eg due to vouchers not honoured, deposits, returns, pre-paid courses etc) you can register an unsecured creditor claim with the administrators using the form.

“Please note, there is no guarantee that there will be any payment to unsecured creditors of the company. If there is a dividend paid, this will be in many months time and is likely to be only a small proportion of the claimed amount.”

Also useful: PC Advisor's Tech Consumer Advice forum

Other Jessops claim advice

Jessops repairs:Where possible customers should liaise with the repair agent to arrange return of their asset and third party repair agents,” says Jessops administrator PWC.

Jessops store managers have been requested to contact customers directly if repairs have been returned to the shops. PWC states that this will be done post closure and collection arranged with the manager.

Jessops warranties: PWC understands that manufacturers will continue to honour the warranties sold through the Jessops stores.

A Jessop Care Plan is provided by Domestic and General (08444 810 500), which should continue to honour these care plans.

Customers who have pre paid for Jessops Academy courses will not receive a refund unless they paid using credit cards.

Jessops photo order: Jessops is unable to guarantee the return of photo orders that have not been collected in store. Store managers should try to contact all known customers to arrange collection of photo orders.  PWC says “If you are not contacted by Saturday 12 January 2013, then contact your local Jessops store directly in order to arrange a suitable collection time.”