Refunds issued as gift cards but won credit card dispute

Grumpy_chap

born_again said:

Grumpy_chap said:

This is the crux, here.  The OP probably could simply spend the gift vouchers and it will be fine.

The key is, though, the OP received the gift vouchers and declined them as a resolution, pursuing the refund to CC as is their right.
It is not the OP's right to have full refund to the CC in addition to gift vouchers (no mention that the retailer offered the gift vouchers as an apology over and above the value of full refund).
The gift vouchers should have been declared as part of the S75 claim.

It would be odd if the OP actually wanted to spend the gift vouchers given the terrible customer service they experienced and their wholesale dissatisfaction with the retailer.

The thing is, I think we should be trying to answer the question as to whether, legally, the OP should attempt to spend the gift vouchers in addition to having received a full refund by S75?
That would seem to me to be a clear "no".

The alternative of "could probably spend the gift vouchers (as well as having had the full S75 refund) will likely be fine" might well reflect practical reality, but does not seem aligned with the strict legal position.
At what point would the "unjust enrichment" become dishonesty?

That would have been the whole point of the OP's claim. That the contract had been breeched by the way it was refunded.
If it was not then the OP has basically lied in their S75 claim.

Which I think verifies that the gift vouchers cannot (should not) now be spent.
The OP purchased some items.
The OP returned those items.
The OP received a refund by way of gift vouchers.
The OP was not accepting of the gift vouchers as the form of refund and wished to be refunded in the original payment manner, as is the OP's right.
The OP pursued the retailer and then the CC under S75.
The OP subsequently received a full refund from the CC.
The gift vouchers, which were rejected by the OP, should now be scrapped.  It is the whole essence of the OP's S75 claim that the gift vouchers were unacceptable.

the_lunatic_is_in_my_head

A_Geordie said:

 The fact the OP is in possession of the vouchers without their consent merely makes the OP an involuntary bailee

That's an interesting thought  

If OP writes twice to say they have the vouchers and hears nothing/vouchers are still active presumably OP can sell them and pay the retailer their value if they ever came looking?

Under the concept of involuntary bailee if you decided not to sell something but instead use it as your own is there anything wrong with that (other than the monetary value)?

I can kind of see what you are saying about not telling the CC company, in theory someone only has to say they haven't been refunded in accordance with the regs. It does just feel more simple if everything is laid out, i.e entitled to refund but got vouchers, for the sake of clarity and warding off any suggestion of dishonesty. 

Ergates

the_lunatic_is_in_my_head said:

Grumpy_chap said:

At what point would the "unjust enrichment" become dishonesty?

At a glance unjust enrichment requires that the enrichment causes a loss to the claimant.

Spending giftcards would involve a loss to the business.   An unused giftcard provided by the business costs them nothing (other than a few pence for the card itself).

Grumpy_chap

the_lunatic_is_in_my_head said:

Grumpy_chap said:

At what point would the "unjust enrichment" become dishonesty?

At a glance unjust enrichment requires that the enrichment causes a loss to the claimant.

So, there is no unjust enrichment if the OP destroys the gift cards, or simply never spend them.
If the OP spends the gift cards, then the OP has gained unjust enrichment.
That creates a loss to the retailer and the retailer is then the claimant.

the_lunatic_is_in_my_head

Ergates said:

the_lunatic_is_in_my_head said:

Grumpy_chap said:

At what point would the "unjust enrichment" become dishonesty?

At a glance unjust enrichment requires that the enrichment causes a loss to the claimant.

Spending giftcards would involve a loss to the business.   An unused giftcard provided by the business costs them nothing (other than a few pence for the card itself).

Grumpy_chap said:

the_lunatic_is_in_my_head said:

Grumpy_chap said:

At what point would the "unjust enrichment" become dishonesty?

At a glance unjust enrichment requires that the enrichment causes a loss to the claimant.

So, there is no unjust enrichment if the OP destroys the gift cards, or simply never spend them.
If the OP spends the gift cards, then the OP has gained unjust enrichment.
That creates a loss to the retailer and the retailer is then the claimant.

 There isn't a loss here, company are whole as they have OP's original money to off set against the gift card value.

Without the CC involvement the company would expect the OP to spend the voucher. 

The enrichment has come from the bank. 

Grumpy_chap

the_lunatic_is_in_my_head said:

Grumpy_chap said:

the_lunatic_is_in_my_head said:

Grumpy_chap said:

At what point would the "unjust enrichment" become dishonesty?

At a glance unjust enrichment requires that the enrichment causes a loss to the claimant.

So, there is no unjust enrichment if the OP destroys the gift cards, or simply never spend them.
If the OP spends the gift cards, then the OP has gained unjust enrichment.
That creates a loss to the retailer and the retailer is then the claimant.

 There isn't a loss here, company are whole as they have OP's original money to off set against the gift card value.

Without the CC involvement the company would expect the OP to spend the voucher. 

The enrichment has come from the bank. 

I used the phrase "retailer" to also include the "CC" as they are equally liable for the same breach.

S75 makes provision for the CC to recover from the retailer:
"the creditor shall be entitled to be indemnified by the supplier"
https://www.legislation.gov.uk/ukpga/1974/39/section/75

Whether the CC recovers the funds from the retailer, or does so via a modified form of chargeback that prevent the retailers then pursuing the consumer, or the CC decides not to recover their losses is a decision for the CC and none of the OP's concern.

The OP remains unjustly enriched if they spend the gift cards.

The whole basis of the OP's claim against the CC is "I have been wronged - I cannot accept and spend the gift cards as refund - I am claiming my rightful refund to the original form of payment".

That has been assessed by the CC and the CC has processed the S75 in the OP's favour.

If the OP's claim against the CC was submitted as "I have been wronged - I cannot accept and spend the gift cards as refund - I am claiming my rightful refund to the original for of payment - once that is received I will also feel able to accept and spend the gift cards" then I am quite certain that the CC would assess the S75 claim and not make a double refund.

The whole purpose of S75 is to make the CC and the retailer "jointly and severally liable".  The purpose of S75 is not to make both CC and retailer liable in ignorance of any other remedy / refund that the consumer has already received from the other of the CC / retailer.  The effect of that would be that any successful S75 claim can also then be pursued via court for the same recovery from the retailer direct (or vice-versa).

S75 - double your money - rub your hands in glee 

A_Geordie

born_again said:

If OP had declared they had not been refunded, that would be a lie, as the vouchers = a refund.

The only basis I can see for a S75 refund is that OP has not been refunded back to the method they paid by. So again if they did not mention they had vouchers they have lied. But then CC would throw the claim out.

As the OP has now received a refund from the CC. The CC are entitled to the vouchers (OP not entitled to betterment) What the CC do & they could take this up with retailer is up to them to send them back for retailer to refund CC. More likely they would just be destroyed.

As a S75 retailer will not be aware that OP has been refunded, which is why vouchers are still active.

Only other thing that could make sense, is if this was a small claim (Can't see any amounts mentioned) & CC have simply just decided to write the amount off.

Maybe MSE would like to run this as one of their moral issues 🤷‍♀️

I think this is where we get into the legal nuances of what is a refund for the purposes of the CCRs. The CCRs are absolutely clear that a consumer will be refunded if they are reimbursed using the same payment method unless the consumer has expressly agreed otherwise (Reg 34(7) of the CCRs). So that, in my opinion is how you determine if the OP has received a refund.

Just because a supplier might send vouchers or shower you with gifts 2x or 3x the value in lieu of the original payment method, that does not amount to a refund if you did not ask for that method of reimbursement. If we were to apply your suggested logic, it would mean the supplier becomes the sole determinator (that even a word or is it determiner?!) as to what is considered a refund, and that doesn't tally with the CCRs say. Like I said in my previous post, something that comes into your possession unwillingly or without your consent would then make you an involuntary bailee.

If the CC Company asked the question, has the supplier given you a refund even if a partial refund? then I think the answer must be no because it is accurate to say that they were not refunded in the way the CCRs stipulate. As you rightly suggest, if there were mention of the vouchers, then its most likely the CC company would take that as the OP having accepted them as a refund, which is not true and giving the OP a bigger headache.

Still don't agree with the CC having the right to take the suppliers property at will as s75 is not designed for that. In the real world, it's likely the supplier could sue and the CC company would countersue for the same value offsetting each others claim (supplier could even potentially sue the OP as an alternative for handing them over to the CC company), but I can also see scenarios where a supplier would want to pursue a claim against a CC company if it related to certain valuable goods such as things that increase in value over time and then ask the court to deliver those goods back to the supplier, leaving the supplier to make a separate indemnity claim. 

Grumpy_chap

A_Geordie said:

I think this is where we get into the legal nuances of what is a refund for the purposes of the CCRs. The CCRs are absolutely clear that a consumer will be refunded if they are reimbursed using the same payment method unless the consumer has expressly agreed otherwise (Reg 34(7) of the CCRs). So that, in my opinion is how you determine if the OP has received a refund.

As @born_again has mentioned upthread, the gift vouchers not being a compliant form of refund must be the breach that has formed the basis of the OP's S75 claim.  Or the OP withheld the full facts from the CC.

There remains nothing to indicate that the OP can retain the gift vouchers, as these were provided by the retailer as the form of refund.
The OP rejected that as a form of refund and pursued the form of refund to which they are entitled (same as the original form of payment).
Part of that rejection of the gift vouchers should have been the return of the gift vouchers.

There is no mention that the retailer provided the gift vouchers by way of apology but only that the retailer provided the gift vouchers as the form of refund.

A_Geordie said:

Still don't agree with the CC having the right to take the suppliers property at will as s75 is not designed for that. In the real world, it's likely the supplier could sue and the CC company would countersue for the same value offsetting each others claim (supplier could even potentially sue the OP as an alternative for handing them over to the CC company), but I can also see scenarios where a supplier would want to pursue a claim against a CC company if it related to certain valuable goods such as things that increase in value over time and then ask the court to deliver those goods back to the supplier, leaving the supplier to make a separate indemnity claim. 

I think there is a good case for the CC being able to take the gift vouchers.
The OP purchased the items.
The items were faulty.
The retailer refunded by way of gift vouchers.
The OP rejected that settlement.
The OP made S75 claim against the CC and this was settled in the OP's favour.
The OP should not be unjustly enriched.
The CC should now get the gift vouchers to compensate the CC for the refund that had to be made via S75.

Let's consider a garage selling a car for, say £3k.  
The car is faulty so a refund is required.
The garage denies the refund.
The consumer pursues S75 claim and the CC pays the consumer the £3k refund.
The CC should now have the car and any salvage / resale value of the faulty car as a form of mitigation against their costs.
The gift vouchers in the OP's case seem to me no different from the car salvage in the hypothetical case.

the_lunatic_is_in_my_head

Grumpy_chap said:

the_lunatic_is_in_my_head said:

Grumpy_chap said:

the_lunatic_is_in_my_head said:

Grumpy_chap said:

At what point would the "unjust enrichment" become dishonesty?

At a glance unjust enrichment requires that the enrichment causes a loss to the claimant.

So, there is no unjust enrichment if the OP destroys the gift cards, or simply never spend them.
If the OP spends the gift cards, then the OP has gained unjust enrichment.
That creates a loss to the retailer and the retailer is then the claimant.

 There isn't a loss here, company are whole as they have OP's original money to off set against the gift card value.

Without the CC involvement the company would expect the OP to spend the voucher. 

The enrichment has come from the bank. 

I used the phrase "retailer" to also include the "CC" as they are equally liable for the same breach.

S75 makes provision for the CC to recover from the retailer:
"the creditor shall be entitled to be indemnified by the supplier"
https://www.legislation.gov.uk/ukpga/1974/39/section/75

Whether the CC recovers the funds from the retailer, or does so via a modified form of chargeback that prevent the retailers then pursuing the consumer, or the CC decides not to recover their losses is a decision for the CC and none of the OP's concern.

The OP remains unjustly enriched if they spend the gift cards.

The whole basis of the OP's claim against the CC is "I have been wronged - I cannot accept and spend the gift cards as refund - I am claiming my rightful refund to the original form of payment".

That has been assessed by the CC and the CC has processed the S75 in the OP's favour.

If the OP's claim against the CC was submitted as "I have been wronged - I cannot accept and spend the gift cards as refund - I am claiming my rightful refund to the original for of payment - once that is received I will also feel able to accept and spend the gift cards" then I am quite certain that the CC would assess the S75 claim and not make a double refund.

The whole purpose of S75 is to make the CC and the retailer "jointly and severally liable".  The purpose of S75 is not to make both CC and retailer liable in ignorance of any other remedy / refund that the consumer has already received from the other of the CC / retailer.  The effect of that would be that any successful S75 claim can also then be pursued via court for the same recovery from the retailer direct (or vice-versa).

Whatever it may be, the retailer is blissfully unaware of the S75 (even if they are why do they care, born_again has said many times the bank write it off, "bottomless pit" was the term used to described the S75 pot) and the bank isn't going to sue the customer so who is the claimant going be for unjust enrichment? 

Grumpy_chap said:

S75 - double your money - rub your hands in glee 

Well yes indeed but doesn't that apply to a lot of cases? Your £1000 TV breaks after 3 months, bank refunds under S75, you fix your TV for £300. 

The fact the banks differ to retailers in that they don't want your stuff sent to them means S75 claims can end up being a bonus for the customer. 

A_Geordie

Afraid I'm still going to have to disagree. The OP has a like claim against the CC company which is non-payment back to the original method and that is not a false statement to make to them.  Mentioning the fact that the OP received unwanted vouchers does not add anything to the claim, nor does it resolve it either and it is not the OP's job to do the CC company's job because the CC company can reach out to the supplier for any other pertinent information to conclude its investigation.

The OP only needs to state the relevant facts and evidence supporting their claim and that is no different to drafting particulars of claim or other statements of case in legal proceedings. Similarly, there is no formal or mandatory requirement that a consumer has follow or the CC companies policies or procedures in relation to s75 or even to answer their questions. You could simply send them a letter before action outlining your claim with a request for payment and failing that, issue proceedings. The CC Company would then need to defend itself with or without the support of the supplier.

As for your analogy, the way you are describing it suggests that the CC company under s75 grants the power to act like some kind of bailiff authority and take control/possession of the supplier's property and in doing so, ownership of that property then automatically transfers to the CC company - that is one hell of a stretch of an interpretation and certainly not how s75 was intended to be used (If you have spare reading time suggest you have a read of the Crowther Report which was a review of consumer credit and provided the framework for the CCA 1974). The meaning of indemnity has been well discussed in case law over centuries which is intended to mean a promise to pay money. I am not aware of let alone heard of any indemnity obligation under any legislation that allows the indemnitee to take control of assets/property and treat them as their own. Something like that would be unusual and it would usually be explicitly drafted to make that clear otherwise the ordinary meaning would be interpreted. 

Not that it matters much in this scenario but I would add that there is always a risk for CC companies settling claims without involving the supplier because although they are entitled to be indemnified, it is not a guaranteed right. The supplier could argue that the consumer didn't have a claim in the first place and base their defence on that. If a court agreed with the supplier, the CC company is out of pocket with no recovery. Another reason to counter your argument that s75 gives the statutory right for a CC company to repossess property at will.