Paying for a new kitchen

Borisbearworrier

Hello

I am looking for some advice as section 75 is confusing me.
I am purchasing a new kitchen and utility room where the total cost is just over £30k.
I know purchases over 30k are not covered but would I be covered if there were 3 invoices: kitchen, utility and fitting?
Or 15 is not sure until the fitting is done and worktops get measured so would I be covered up till that point as the total cost paid out would be less than 30k and I would lose some protection post build.

Thanks

eskbanker

The S75 limit is £30K for the item value, but jobs like this do tend to be treated as a cohesive whole for such purposes.  Do you have the option of commissioning the works as two completely separate projects, i.e. kitchen and utility room as two different contracts, rather than just being invoiced separately?

Borisbearworrier

Hi

We so far have only been given a quote for each one and then an overall invoice rather a contract.
Would I be covered by section 37 before the final payment was made - say I paid 25k of the whole project and something went wrong or would the look at the end value?

km1500

End value. Try and get two separate quotes for two totally separate jobs. Two invoices, pref separated by a reasonable period eg 6 weeks. Do job1, pay, wait 6 weeks, do job2 pay. Otherwise no S75

Borisbearworrier

I don't think we will be able to split the work over 6 weeks in reality. Are there any other ways to get some protection? I'm naturally risk adverse.

born_again

S75 is not a insurance or cover all risk covering option.

But you do still have chargeback options. So should the work not get done you have some cover (no limit on chargebacks)

eskbanker

born_again said:

S75 is not a insurance or cover all risk covering option.

But you do still have chargeback options. So should the work not get done you have some cover (no limit on chargebacks)

While you're obviously right that chargeback is an option instead of s75, there are of course some limits - the maximum value that can be claimed is what's paid for on the card (unlike s75 where a small card payment secures coverage for the whole transaction, albeit that's constrained to £30K), but perhaps more importantly in this sort of situation, chargeback claims can only be made within 120 days.

km1500

To get S75 you need to arrange your work so you have two (or more) unconnected transactions each under 30k

DullGreyGuy

eskbanker said:

The S75 limit is £30K for the item value, but jobs like this do tend to be treated as a cohesive whole for such purposes.  Do you have the option of commissioning the works as two completely separate projects, i.e. kitchen and utility room as two different contracts, rather than just being invoiced separately?

It depends on how its put on the invoice... did see one FOS case a while back where the invoice clearly listed X door handles at £10 each, X new doors at £75 each and £300 fitting (or whatever the numbers were). The Bank only offered settlement on the fitting saying the other items were under £100 each and the FOS upheld the banks decision. 

Certainly breaking them into independent contracts with separate pricing will help ensure they stay under the upper limit of the act however there is the risk individual items could be more granular and cover is less than you hope.

eskbanker

DullGreyGuy said:

eskbanker said:

The S75 limit is £30K for the item value, but jobs like this do tend to be treated as a cohesive whole for such purposes.  Do you have the option of commissioning the works as two completely separate projects, i.e. kitchen and utility room as two different contracts, rather than just being invoiced separately?

It depends on how its put on the invoice... did see one FOS case a while back where the invoice clearly listed X door handles at £10 each, X new doors at £75 each and £300 fitting (or whatever the numbers were). The Bank only offered settlement on the fitting saying the other items were under £100 each and the FOS upheld the banks decision. 

Certainly breaking them into independent contracts with separate pricing will help ensure they stay under the upper limit of the act however there is the risk individual items could be more granular and cover is less than you hope.

True, item valuations for s75 purposes come into play at both ends of the scale, the key thing being to ensure, to the extent possible, that invoices (and preferably contracts) are structured to show items between £100 and £30K.  Two large contracts would seem to be ideal here rather than one, but yes, if breaking things down, it would be better not to do so to individual fitted component level!

born_again

Not forgetting if you do break it down.
Do not use the same CC for payments. They are not daft & will catch on to what you are trying to do.

But the odds of needing S75 are very slim.