If a company goes bust

sharpy2010

About to pay for my wedding which is in 2015, and would like to pay on a credit card (which I will then pay in full when the bill comes).

My question is, if the wedding company goes bust, am I able to claim for non receipt of goods? In other words lets say I pay for the wedding now, and a month before the wedding the company goes bust, which would be about a year and three quarters after the payment was made, would I be able to claim back the cost of the wedding from the card company, or would I be out of time to do so?

Thanks!

chattychappy

S75 means the CC is jointly and severally liable for misrepresentation or breach of contract. Ie they stand "shoulder to shoulder" with the wedding company. In practical terms, this means you can claim damages if the wedding company goes bust. Damages are what it would cost to put you back into the same position had the breach not occurred - so you might be entitled to more than the original transaction value.

On the other hand, it is always at the option of the CC to perform the contract - ie to deliver what was promised by the wedding company.

The time limit for a claim is 6 years from the date of breach. You do not have to wait for the breach to actually happen (ie the wedding day). You can claim from when it becomes clear that performance isn't going to happen ("anticipatory breach").

Not sure about chargeback time limits, but S75 is the statutory protection and is potentially more generous anyway.

Congrats, BTW.

Oh and I assume the wedding will cost more than £100!

sharpy2010

Hi ChattyChappy, thanks for that :-) You are right in assuming it will cost more than £100! We have paid the initial wedding deposit in cash, which was £500 (and I appreciate that will be lost in the event of the company going bust), and I wanted to pay the remainder by card in order to have protection for the bulk of the money, which I now understand is 6 years from time of purchase, and as the wedding is 2 years away, this means it will (should!) be covered.

Obviously I am hoping nothing will go wrong, and that the day goes without hitch, but it is always nice to be protected if there is some form of protection available to utilise :-)

Thanks once again for the detailed information, it is very much appreciated!

lawstudent

sharpy2010 wrote: »

We have paid the initial wedding deposit in cash, which was £500 (and I appreciate that will be lost in the event of the company going bust)

Just wanted to point out that this money would not be lost should they go bust. The credit card company would be liable for the full amount. Even if you paid £1 on your credit card so long as the total price of the item was over £100 you are fully covered even if you paid some of the balance using an alternative method.

chattychappy

sharpy2010 wrote: »

which I now understand is 6 years from time of purchase, and as the wedding is 2 years away, this means it will (should!) be covered.

In fact it's 6 years from date of breach... so you have even longer!

lawstudent wrote: »

The credit card company would be liable for the full amount.

Indeed and as you probably know, "full amount" in this context is the full amount of damages - which can be more than the original transaction amount.

sharpy2010

Thats brilliant, thanks to you both for clarifying the situation for me. Its nice to know that the £500 deposit is also covered as well! We obviously have a receipt so if anything were to happen, it should be plain sailing.

Of course, we'd much rather the day went smooth and there were no issues, but these days you have to be careful :-)

Cheers again both!