Comet: what are customers' rights?

With high street chain Comet in administration what does that mean for the many customers who've bought an item online, are awaiting a Comet delivery or have purchased gift vouchers as Christmas presents?

And what about extended warranties on items bought months ago? Martin has the answers!

I bought goods from Comet, now it’s in administration. What are my rights if they’re faulty?

Buy faulty goods and by law, your rights are with the shop you bought it from, not the manufacturer – and it should provide the ‘remedy’. Return it quickly enough, and you’re entitled to a full refund. Later, and you’re entitled to repair or replacement.

Yet Comet is now in administration. In other words, it’s been taken over by a team of administrators and their job is to get as much back for the creditors (the people owed cash by Comet) as they can.

They’ll do this either by running it as an ongoing business and seeing if they can sell it, or by flogging off its assets – or a combination of both. Then, what usually happens is they try and return say, 20p in the pound, of what’s owed.

The fact it’s in administration means it’s effectively a different entity to what it was before. Accountancy firm KPMG confirms that by law your consumer rights to a refund still stand. But while the firm is in administration, if the item you purchased is faulty, your claim for a refund would just be another claim as a creditor to the store – you’re one of a long list.

However, Comet’s administrator Deloitte says, regardless of whether or not items were bought before or after it went into administration, as the store is still up and running, it’ll try to offer repairs on own-brand products (no refunds) to protect its existing trade. If you bought branded goods, it wants you to use the manufacturer’s warranty. Sadly, if that isn’t good enough, your only option is to become a creditor.

Yet do check back old statements to see if you bought goods on a credit card. As if so, provided they cost over £100, under Section 75 laws (see the useful links for more info), the credit card company is jointly liable for any problems, mirroring your rights with the retailer. So if goods are faulty you can complain to your provider, in exactly the same way.

If the item is for less than £100 or you bought it on debit card, try the Visa or Mastercard chargeback schemes – these aren’t legal requirements, but are a promise by the card operators that if you complain within 120 days that the transaction hasn’t been fulfilled, it should arrange to give you your money back.

Can I still use my gift vouchers at Comet?

Yes. Comet is now accepting gift cards, after originally saying no, except for those issued by corporate customers such as insurers. But you should use them ASAP if you’ve got any, as it’s not clear how long stores might be open for. It’s within its rights to change its mind.

I ordered goods from Comet, but they haven’t been delivered – where do I stand?

Comet says it will fulfil any orders where the item is in stock. But if the product is unavailable, it will NOT offer a refund – as explained above, you’d effectively become a creditor to the company – someone owed money and that means you’re unlikely to get cash back.

However, if what you’ve bought costs over £100 and you paid by credit card, the credit card company is jointly liable with the retailer, so you can get make a claim under Section 75 of the Consumer Credit Act to your card company to get the money back.

If the item is for less than £100 or you bought it on debit card, try the Visa or Mastercard chargeback schemes – these aren’t legal requirements, but are a promise by the card operators that if you complain within 120 days that the transaction hasn’t been fulfilled, it should arrange for you to get your money back. So it’s very useful in the case of non-delivery.

Is my extended warranty/ service agreement still valid?

If you paid for an extended warranty (it will say “regulated by the Financial Services Authority”), it is likely to be with a third party insurer rather than Comet, in which case it is still valid regardless of what happens to Comet – this has been confirmed by administrator Deloitte.

However, if it’s a service agreement provided by Comet itself, then while the administrator says Comet will honour these, this is obviously only as long as it’s still in business – the liability may not be sold on if Comet is sold. If it closes down, again, you will have to become a creditor.