Legal option in case of supplier going bankrupt

Mudball

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We r getting a local kitchen company to do our kitchen. It’s our last big kitchen Reno so we went for a local + a bit premium. They have a few showrooms dotted around. They are also very active on social media and prize winners on Houzz

We paid a deposit to get drawings and for them to start building the kitchen. 3 weeks ago, I met the guy for some changes and we agreed to go ahead.

Since then all of the contacts have gone quiet. No one returning calls/emails etc. seeing some recent comments on social, it looks like I am not the only one who is not getting calls back.

Is there any way to know if they have gone into administration or run away. They have our money. But it also means we need to start on the kitchen process again

(I am out of the country, so can’t visit their showroom to make some noise)
 

GreiginFife

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We r getting a local kitchen company to do our kitchen. It’s our last big kitchen Reno so we went for a local + a bit premium. They have a few showrooms dotted around. They are also very active on social media and prize winners on Houzz

We paid a deposit to get drawings and for them to start building the kitchen. 3 weeks ago, I met the guy for some changes and we agreed to go ahead.

Since then all of the contacts have gone quiet. No one returning calls/emails etc. seeing some recent comments on social, it looks like I am not the only one who is not getting calls back.

Is there any way to know if they have gone into administration or run away. They have our money. But it also means we need to start on the kitchen process again

(I am out of the country, so can’t visit their showroom to make some noise)
I could be wrong but didn’t SILH go through something similar recently? He might advise.
 

Neilds

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We had similar a few years ago when furniture company went belly up. We had paid cash as we had saved up so had no way of getting anything back - lesson learnt. If you paid at least £100 on a credit card you will be able to claim back through them. We found out that the small people are at the back of the queue when it comes to recovering any money, but the accountants don’t suffer🤬
 

Mudball

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I could be wrong but didn’t SILH go through something similar recently? He might advise.
Will wait for him/her/it

We had similar a few years ago when furniture company went belly up. We had paid cash as we had saved up so had no way of getting anything back - lesson learnt. If you paid at least £100 on a credit card you will be able to claim back through them. We found out that the small people are at the back of the queue when it comes to recovering any money, but the accountants don’t suffer🤬
Unfortunately the amount was bigger than my credit card, so bank transfer. I m sitting on egg shells now
 

SwingsitlikeHogan

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We got our deposit (a few thousand 🙄) refunded through the bank chargeback scheme. As we had paid using a debit card and not a credit card we could not claim deposit back through Section 75 of the Consumer Rights Act. Though our claim through chargeback was successful we were advised by the administrators that we might have to return our refunded deposit - I’m assuming if there weren’t sufficient funds to pay creditors having priority. We were given a date a few months away that we would hear by, and if we heard nothing by then then we were good. We didn’t. Sorted.

I‘m thinking paying by bank transfer may be equivalent to paying by debit card. Good luck. You may be OK. Though my caution is that our supplier was small compared with such as Wren or Howdens, and so there may well have been relatively few customers such as ourselves seeking a refund.
 
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Mudball

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Finally heard back from the guys. Apparently they have been bought out and all of them told not to contact anyone till the sale is closed. Now they are under new ownership. So the sales guy was saying ‘everything retuns to normal next week and we will do all the drawings and send over. Also next tranch of payment is due. Will reissue the invoice but with different bank details’

Now all this could be legit. I had a look at company house and there is no indication yet of the sale. Their website does not say anything. Irrespective of ‘we r back to normal’, every new owner will make changes. We really liked them but not if they change their people.

What should I be asking/looking for? Our first 25% is with them and it is technically non-refundable under the old contract. Equally I don’t want to throw good money after bad. We can continue with a make shift kitchen for an additional month if needed
 

SwingsitlikeHogan

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I’d be very wary. We really liked the designer of the company we were with that went bust, and he did a great design for us. But we had reason to ask him if things with the company were ok as we had seen a lease available sign on the building they were in. He reassured us…so we paid our deposit…and a few weeks later we found out they‘d gone into admistration.

Now the lease sign and their administration may have been purely coincidental and not linked…so either that was the case and he really didn’t know what was coming, or he was spinning us one. Given we really liked and trusted him we hold to the former. It matters nowt now if it were any different.

You may have grounds for a chargeback deposit refund under Section 75 of the CRA on the grounds that the supplier you were contracted with is not going to be the one supplying the goods or service, and that the original contracted supplier can no longer supply the goods and service.

I may put a deposit down for a new sofa from John Lewis as I know and trust the company and the service they provide - but if they were bought out by Fred Blogs Ltd…a company I know well but wouldn’t buy anything from in a million years, I think I would try and get my deposit back and expect to succeed.
 
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Fade and Die

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Finally heard back from the guys. Apparently they have been bought out and all of them told not to contact anyone till the sale is closed. Now they are under new ownership. So the sales guy was saying ‘everything retuns to normal next week and we will do all the drawings and send over. Also next tranch of payment is due. Will reissue the invoice but with different bank details’

Now all this could be legit. I had a look at company house and there is no indication yet of the sale. Their website does not say anything. Irrespective of ‘we r back to normal’, every new owner will make changes. We really liked them but not if they change their people.

What should I be asking/looking for? Our first 25% is with them and it is technically non-refundable under the old contract. Equally I don’t want to throw good money after bad. We can continue with a make shift kitchen for an additional month if needed
This sounds like BS, why would you ignore customers who have paid deposits? For a small independent your reputation on Social Media is everything, (that was my deciding factor when choosing recently).

Can you get the name of the new company and explain to your bank what has happened and ask them to do a credit search on them?

Or would it be possible to get a vesting certificate drawn up? We use these all the time in work, it means that paid goods held by a supplier actually belong to someone else and in the event of bankruptcy they are excluded from the suppliers assets.

Tricky situation but I would be very reluctant to part with more cash at the moment.
 

SwingsitlikeHogan

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I think proper legal advice is required, not hearsay from a golf forum TBH
As it happens it was advice from a forummer that had me heading down the chargeback route…so…you know…the experiences of others in similar circumstances to an issue I might have can trigger routes of recourse I may not have thought of…or thought of having realistic chance of a positive outcome - as is currently the situation with our drier.

Though the truth is absolutely as you say…a kitchen deposit is quite a different kettle of fish to a £300 drier.
 

SwingsitlikeHogan

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I am not dismissing it, but something as this does really need advise from someone accountable:)
You could call in to Daniel Barnett on LBC Legal Hour


…or Dean Dunham on the LBC Consumer Hour

 

Bunkermagnet

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You could call in to Daniel Barnett on LBC Legal Hour


…or Dean Dunham on the LBC Consumer Hour

No thanks
 

Mudball

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So finally got thru to one of the directors. He confirmed that the control of the company is with the administrators and he does not have access to any bank accounts. So no way jose for getting a refund. The says they should be able to close the sale of the company this week. And that the new owners will honour the guarantees etc. and that the company will continue in its existing form with the staff.

So basically we are stuck. I am not sure the bank can do much - they would say that the company is in administrators so wait and watch.. What a nightmare when you choose to work with a family owned company rather than go big chain
 

Mudball

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Looks like the company is now finally sold and n the hands of new owners. Other than verbal comms via the sales guys, we haven received anything in writing about what happened or what is going to happen. Out of the blue, had the sales guy call to say, that all has been sorted and we are back at work. Sent thru the design etc. Wants to start work on next stage to build the kitchen and the second stage payment. As much as I want to believe them, there is a bit of me holding back. They have a sizeable deposit already and i dont want to throw good money after bad.

Am waiting to talk to a lawyer friend next week when he is back. Thoughts ?
 

Fade and Die

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Looks like the company is now finally sold and n the hands of new owners. Other than verbal comms via the sales guys, we haven received anything in writing about what happened or what is going to happen. Out of the blue, had the sales guy call to say, that all has been sorted and we are back at work. Sent thru the design etc. Wants to start work on next stage to build the kitchen and the second stage payment. As much as I want to believe them, there is a bit of me holding back. They have a sizeable deposit already and i dont want to throw good money after bad.

Am waiting to talk to a lawyer friend next week when he is back. Thoughts ?

Just coming to the end of our kitchen being fitted. The process was, visit showroom, pick out what you like. Saleswoman came around a week later and done a couple of designs which she emailed to us with prices.
We done a bit of haggling then agreed on a design and a price. Then we had to pay a 50% deposit.
A few weeks later we was told approximately when it would be ready. We agreed an install date and had to pay the balance 2 days before it was delivered.

Had to pay the fitter’s directly 50% at the beginning then the remainder when completed.

The whole process was simple and hassle free, honestly what you are going through just seems wrong. Get advice, also tell the salesperson just how you feel and tell him you will not pay any more money until you get some reassurance.
 

fundy

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Will wait for him/her/it


Unfortunately the amount was bigger than my credit card, so bank transfer. I m sitting on egg shells now

Not wanting to bash but for future reference always pay at least £100 of the deposit on credit card and then you can pay the rest by bank transfer. The credit card company will then cover the whole cost if something happens
 

fundy

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Looks like the company is now finally sold and n the hands of new owners. Other than verbal comms via the sales guys, we haven received anything in writing about what happened or what is going to happen. Out of the blue, had the sales guy call to say, that all has been sorted and we are back at work. Sent thru the design etc. Wants to start work on next stage to build the kitchen and the second stage payment. As much as I want to believe them, there is a bit of me holding back. They have a sizeable deposit already and i dont want to throw good money after bad.

Am waiting to talk to a lawyer friend next week when he is back. Thoughts ?

whatever you do dont pay anymore money until you know the whole situation and have taken proper advice, and if you do get to the point where you are happy to pay another tranche, make sure you put some of it on the CC

do you know the company who has taken them over? are you able to do some research into them, their finances and whether they have taken over another company before and how they handled things then?
 

Mudball

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Not wanting to bash but for future reference always pay at least £100 of the deposit on credit card and then you can pay the rest by bank transfer. The credit card company will then cover the whole cost if something happens

Not sure i understand this...
Assume that the invoice is 10k.... So i pay say £500 on CC and 9500 by bank transfer.. will the CC cover 10k or 500?
 
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