Home furnishings group Courts went into administration on Tuesday. If a firm goes under owing you money, there is one way to get your money back...
It's been a bad week for the customers, staff, shareholders and suppliers of Courts.
Courts is the UK's fourth-largest furniture retailer, with 88 stores and around 2,500 staff. However, the company has been struggling this year. Its shares went into freefall after the firm released a profit warning in mid-April. They have plunged from 334p in mid-January to 13.5p before being suspended on Monday.
Unfortunately, Courts owed its bankers around £280m and, thanks to its trading losses and poor stock control, the banks decided not to increase the company's lending facility. Thus, in order to stave off bankruptcy, Courtsappointed KPMG as administrators. However, Courts' overseas businesses are trading profitably and are unaffected by these developments.
KPMG has already had around sixty "expressions of interest" from potential buyers of the home-furnishings group, so it's likely that the banks will get back much of their money. Unfortunately, there is unlikely to be anything left in the pot for the firm's shareholders and unsecured creditors, including its customers and suppliers.
Courts stores have been closed since Tuesday for a comprehensive stock check. They didn't reopen today as planned, after angry scenes at a number of outlets. KPMG has confirmed that over 3,000 paid-for orders are ready for collection from stores. However, the vast majority of paid-for orders aren't in the stores and, as the manufacturers haven't been paid by Courts, they won't be fulfilling these orders. Sadly, most customers who have paid in full or left a deposit for goods have lost both their money and their goods.
Although KPMG will be writing to Courts' customers who have unfulfilled orders, this will not be for around eight weeks. And, in any event, the banks are at the head of the queue, so other creditors are unlikely to see a penny. Nevertheless, you can register a claim with KMPG by writing to:
- The Administrators, Courts (UK) Limited, The Grange, 1 Central Road, Morden, Surrey, SM4 5PQ.
KPMG has set up a helpline for shareholders and customers on 0870 950 1333 (please note that calls to 0870 numbers can cost up to 10p per minute!). If you have paid by cash or cheque, you have no chance of receiving a refund. However, a few debit cards (and premium bank accounts) do offer cover for these losses, so check with your bank to find out if you have this protection. Regrettably, most debit cards won't refund your money.
On the other hand, if you have paid by credit card for goods costing £100 or more, you should claim against your card issuer under Section 75 of the Consumer Credit Act. Even if you only paid a deposit on your credit card, you can demand a refund of the entire amount from your card company. However, card issuers keep very quiet about this cover, and there have been numerous cases where they have tried to wriggle out of paying claims, so stand your ground!
The same advice goes to customers of AuctionWorld, the shopping channel that went into administration on 23 November with debts of £14m. If you are one of the 27,000 customers who have paid by credit card for goods, but haven't received them (or they were faulty or not as advertised), contact your card issuer now!
Learn more in Plastic Protection.
More: Find a first-rate card in our Credit Card centre.
