Help please. Company in liquidation have repaid for goods purchased with no authority

franchesca

Hi
I don't know if anyone here can help-have searched online to no avail. Last year my son bought an amp from Reverb who set up a repayment plan with Duet retail services. He has received a letter saying Reverb have gone into administration and they had no authority to cause a contract between Duet and them so they were returning the money.. It goes on to say they have never owned the musical equipment and it may still be the property of Reverb who may ask you for it's return or payment for it. Duet have returned the money -£550 ish (minus the deposit that was paid directly to Reverb).
Does anyone know if the company can ask him to pay for the goods or can he return the amp if they ask for it instead-he is a student so would obviously benefit greatly if he can spend this but he is also willing to return the amp if asked as it is no longer required.
I don't want him to spend it if he will then be asked to pay it again. Where does he stand legally?
Any help greatfully appreciated.

paddyrg

I don't understand - Reverb went into administration but Duet returned the money for a product your son already has taken and used? Something isn't making sense to me, perhaps it's just how I'm reading your post though, so can you help clarify a little?

shocky_2

Its a very odd situation. If Reverb have gone into administration then they might be in chaos and will never ask for anything. But it is also possible that the administrators or Duet will ask your son to return the money.

Personally I would put the money in a separate high-interest savings account so that your son is not tempted to spend it, at least for six months or so.

lukerichardson40

I dont get it either... Is this right...

1. OPs son purchased an amp from Reverb on finance with Duet
2. Reverb go in to liquidation
3. Duet give money back, less deposit
4. Ops son now has amp and money
5. Duet not sure who owns amp

WestonDave

I "think" I get it! My first question is over the date - could it actually be longer ago? Reverb Retail went bust in April 2010.

Assuming its them, the likely scenario is son buys amp on finance from Reverb shortly before it goes under. What should have happened is that Reverb bills Duet for the amp, Duet pays over the cost, and sets up a loan for son to repay. In the kerfuffle, this never happens so its just repayments going into an non account. At some point this gets picked up on audit and the money refunded because at this stage Duet can't get in contact with Reverb and would probably get into trouble if they are collecting repayments without having actually outlayed the cost of the amp.

They are right to warn that Reverb may not have paid their supplier for the amp and that therefore it might technically still belong to the supplier (reservation of title clause etc), however in practical terms the supplier will have gone into Reverb 2 years ago, collected up anything that was there and taken it to resell - they were never going to start going through Reverb's customer records to track down amps sold and get them back from musicians!

However technically the money (the full cost of the amp less deposit) should be paid to the liquidators David Rubin and Partners, but if they haven't come looking for it by now, I suspect they haven't got the records or resources to track it down. The right thing to do is to call them up and explain and see what they say - however if you just put the money in an account and wait until the liquidation is finished (you can check easily enough when its disolved on the companies house website) then the chances are you'll not hear anything more.

franchesca

Hi again
I am finding it odd myself but I think you have the idea. Yes he bought the amp in Bristol from Reverb in 2010 and paid for it on a monthly agreement with someone called MIFCO leasing and finance (assume this is Duet or was Duet???). As far as we knew he had paid it and that was that. Looking Reverb up online I see they did go into liquidation in 2010 but we knew nothing of this as he just kept paying the standing order until it was all paid for. We then received a letter from Duet finance, (it says on the bottom of the letter Musical Instrument finance, leasing, maintenance and consultancy)saying 'reverb had no authority from this company to howsoever cause a contract between us and accordingly all the money you have instructed your bankers to send us was in error'

It says at the end that on behalf of this company we are sorry that you were persuaded to send us money by the reverb staff.

It sounds so fishy to me that I feel he must have some case to keep the money and if asked just return the amp. Surely duet should have noticed after a year of payments that they were being paid for something they didn't own! Then there's the fact the standing order was to Mifco-all sounds so confusing but in the end I have a son living on very little a week at the moment who needs new drum cymbals and is very tempted to spend it.
I have given him your advice but would love to know where he stands legally. He would happily return the amp to be able to buy new equipment but is worried they may ask for it back but can they take the cash back if they took it unlawfully???

I see also that the director of the company is/has been a director of 18 other companies-is this normal? I have no knowledge of these things and really appreciate your input.
Thank you very much for replying and any other info gratefully received.

arcon5

Well will or will not happen isn't necessarily inline with what the law permits. Technically there is now a debt and the company could ask him to pay them for the goods - well in this case it would be the administrators. This would be statutory barred after 6 years.
However if Reverb went under in 2010 (as per other member) and the administrators have done their job and moved on then what's likely to happen is... well.. nothing...

Has anybody actually contacted you about this other than regarding the reimbursement?

schoolrunmum

It's not unheard of for companies records to be so messy that they are not sure who owes them what ! I had a mate who took out a loan offered by his company and when they folded he was never asked to repay the money. Another mate in same company was never asked to return his company car !

paddyrg

You cannot rely on nothing happening though, it is possible a part of the administration included selling old loans and debts to an agency, who may then resell that debt, etc. Entirely possible there will be a letter arrive once day demanding the money. I very much doubt whether anyone would accept the kit instead, add it is clearly now in a used condition. Put the money aside in a 30 day access account so it is hard to get his hands on and enjoy it in 6 years if nobody chases it, or hand it over easily if they do!

Ectophile

I'd go with paddyrg's suggestion. The chances are, nobody will try to collect the debt. But just in case, shove the money in an interest-paying bank account for the next 4 years.

If the administrator comes looking for the money, pay it back and pocket the interest.

If nothing happens for 6 years after the amp was bought, just keep the money.

ThumbRemote

Agree with the advice above. Keep the money safe, they may want it back. Buy some premium bonds, then if you are asked for the money back you can cash them in. If not, cash them in 6 years after you bought the kit and keep the money.