Legal Tender and consumer contract law

trusaiyan

unholyangel said:

You are well and truly barking up the wrong tree. Legal tender refers to the payment of debt into court only. It has no bearing on a contract between two parties. 

ETA: Also, legal tender doesn't exist everywhere in the UK - there's no mechanism for legal tender in scots law/scotland. Even BoE notes aren't legal tender in scotland because of that. 

Thanks for the response.
So if my friend refused to pay in another way because he tendered the exact amount of legal tender (which for the purposes of argument was exactly £50), could he be sued for non-payment of the restaurant meal 'debt' in court?

Or put another way, are you saying that if he definitely wanted the £50 note legal tender to be accepted, he would have to wait to be sued in court, at which point he could offer the £50 note to pay for the £50 meal debt, which MUST by legal tender law be accepted in the court to extinguish this debt?

I'm sure legal costs would surpass this, but that is a truly ridiculous situation if true...

davidmcn

trusaiyan said:

davidmcn said:

trusaiyan said:

 being rejected (without any suspicion of fraud)

I thought it was common knowledge that £50 notes are commonly not accepted because there's perceived to be a greater risk of forgery. If that wasn't the reason for the restaurant's policy, why was it rejected?

Yes it will likely be for forgery reasons, they can't be bothered having to deal with the risk.

Right, so it was because of suspicion of fraud after all. Not necessarily a personal judgement against your friend, just the general concern of fraud surrounding £50 notes.

trusaiyan

davidmcn said:

trusaiyan said:

davidmcn said:

trusaiyan said:

 being rejected (without any suspicion of fraud)

I thought it was common knowledge that £50 notes are commonly not accepted because there's perceived to be a greater risk of forgery. If that wasn't the reason for the restaurant's policy, why was it rejected?

Yes it will likely be for forgery reasons, they can't be bothered having to deal with the risk.

Right, so it was because of suspicion of fraud after all. Not necessarily a personal judgement against your friend, just the general concern of fraud surrounding £50 notes.

But completely off-topic.

And the point I was making was the note was not examined for fraud - that is still true, they just had a company policy that was only brought to his attention after the meal. He would have felt different if they examined it and claimed it was forged, which never happened.

unholyangel

trusaiyan said:

unholyangel said:

You are well and truly barking up the wrong tree. Legal tender refers to the payment of debt into court only. It has no bearing on a contract between two parties. 

ETA: Also, legal tender doesn't exist everywhere in the UK - there's no mechanism for legal tender in scots law/scotland. Even BoE notes aren't legal tender in scotland because of that. 

Thanks for the response.
So if my friend refused to pay in another way because he tendered the exact amount of legal tender (which for the purposes of argument was exactly £50), could he be sued for non-payment of the restaurant meal 'debt' in court?

Yes.
Put it this way. Legal tender does not dictate what denominations a retailer has to accept. It just means that if you perhaps agreed to pay USD, then you can't successfully be sued for non-payment, if you offer to pay into court the debt in legal tender. Despite it not being what was originally agreed. 

There can be exceptions that to that though. Particularly with cross border disputes. 

unholyangel

Also, offering payment in legal tender doesn't mean you don't have to settle the debt. Just that you have a defence if they sue you specifically for non-payment.

trusaiyan

unholyangel said:

trusaiyan said:

unholyangel said:

You are well and truly barking up the wrong tree. Legal tender refers to the payment of debt into court only. It has no bearing on a contract between two parties. 

ETA: Also, legal tender doesn't exist everywhere in the UK - there's no mechanism for legal tender in scots law/scotland. Even BoE notes aren't legal tender in scotland because of that. 

Thanks for the response.
So if my friend refused to pay in another way because he tendered the exact amount of legal tender (which for the purposes of argument was exactly £50), could he be sued for non-payment of the restaurant meal 'debt' in court?

Yes.
Put it this way. Legal tender does not dictate what denominations a retailer has to accept. It just means that if you perhaps agreed to pay USD, then you can't successfully be sued for non-payment, if you offer to pay into court the debt in legal tender. Despite it not being what was originally agreed. 

There can be exceptions that to that though. Particularly with cross border disputes. 

But there now exists a 'debt' (I assume), so surely at this point in these types of transactions (not merely instant transactions over the counter, but where services have already been used) the legal tendered cash must extinguish the debt?

If he can't successfully be sued in court because he offered legal tender, then surely this is the same as extinguishing the debt?
I.e. he could walk away having attempted to pay for his debt in exact legal tender, and he could not be successfully sued in court for non-payment (because he offered the correct legal tender)?

In the alternative, if the debt remains after walking away but he is brought to court by the restaurant, he could then pay in the exact legal tender he originally offered, which must by law legally extinguish the debt whether the restaurant accepts the payment in court or not?

trusaiyan

unholyangel said:

Also, offering payment in legal tender doesn't mean you don't have to settle the debt. Just that you have a defence if they sue you specifically for non-payment.

So if he offered to pay into court in the correct legal tender for the £50 meal debt (i.e a single £50 note), you are saying this wouldn't extinguish the debt (regardless of whether they take the money or not)?

unholyangel

trusaiyan said:

unholyangel said:

trusaiyan said:

unholyangel said:

You are well and truly barking up the wrong tree. Legal tender refers to the payment of debt into court only. It has no bearing on a contract between two parties. 

ETA: Also, legal tender doesn't exist everywhere in the UK - there's no mechanism for legal tender in scots law/scotland. Even BoE notes aren't legal tender in scotland because of that. 

Thanks for the response.
So if my friend refused to pay in another way because he tendered the exact amount of legal tender (which for the purposes of argument was exactly £50), could he be sued for non-payment of the restaurant meal 'debt' in court?

Yes.
Put it this way. Legal tender does not dictate what denominations a retailer has to accept. It just means that if you perhaps agreed to pay USD, then you can't successfully be sued for non-payment, if you offer to pay into court the debt in legal tender. Despite it not being what was originally agreed. 

There can be exceptions that to that though. Particularly with cross border disputes. 

But there now exists a 'debt' (I assume), so surely at this point in these types of transactions (not merely instant transactions over the counter, but where services have already been used) the legal tendered cash must extinguish the debt?

If he can't successfully be sued in court because he offered legal tender, then surely this is the same as extinguishing the debt?
I.e. he could walk away having attempted to pay for his debt in exact legal tender, and he could not be successfully sued in court for non-payment (because he offered the correct legal tender)?

In the alternative, if the debt remains after walking away but he is brought to court by the restaurant, he could then pay in the exact legal tender he originally offered, which must by law legally extinguish the debt whether the restaurant accepts the payment in court or not?

What extinguishes the debt is paying the debt. Having a defence to any action for non-payment (which would make you liable for costs incurred) is not the same as saying you don't have to pay the original sum. 

If what you propose was correct, we'd all be paying everything with £100 notes in the hope they refused so we'd get it free. 

In a nutshell, your friend should spend less time trying to get a free lunch by misapplying technical legal arguments he doesn't understand and more time sorting out payment. Whether that be by card, having to go to the atm or, if he genuinely has no other means of payment on him at the time, then he should leave his details and/or some sort of security so he can arrange to pay later. 

davidmcn

trusaiyan said:

unholyangel said:

Also, offering payment in legal tender doesn't mean you don't have to settle the debt. Just that you have a defence if they sue you specifically for non-payment.

So if he offered to pay into court in the correct legal tender for the £50 meal debt (i.e a single £50 note), you are saying this wouldn't extinguish the debt (regardless of whether they take the money or not)?

Where did you get the idea that merely offering to pay the debt extinguishes the debt? It has to actually be paid.

mattyprice4004

I never understand these threads - and I used to pay for quite a lot of things with £50 notes back in the day. 
If they weren't accepted, I'd just take a card out and pay with that. 

The intricacies don't matter - what matters is he's eaten a meal, and must pay for a meal - and if they refuse a note that is very easy to copy and request another payment method then that's reasonable.
Your 'friend' sounds like one of the people who make retail / foodservice such an awful industry to work in.