I received a refund when I did not return the item, and they won't reverse the refund? At what point is that considered "my money"?

Question

The item was a mattress, which I still have and never asked to return. They made a mistake with my delivery and the delivery fee was supposed to be returned. However, the credit, about $600 is on my credit card, which previously had a zero balance, and has been sitting there for two months. I just received a check from my credit card company and I don't know if I should cash it!

We, myself and the credit card company, have tried to contact the company multiple times and they have done nothing!

What should I do?

Answer 1

The check is from your credit card company. Whose ever the money is, it is certainly not the credit card company's, and they know that. This is why they cut the check to you. You should definitely cash the check (or deposit it into your bank account).

You've tried to contact the mattress store multiple times, and they aren't responding. At some point, you've got to say that you've done everything that you could to do the right thing.

Now, keep in mind that at some point in the future, the mattress store may come back to you and ask for the money back. If I were you, I would not spend this money for quite some time. Put it away in a savings account (maybe add it to your emergency fund). Then if they come back in the future looking for money, you can easily write them a check. You probably also want to keep some documentation on what you've done already to try to give the money back to them, just in case for some reason they try to claim that you owe them some interest or something like that.

Answer 2

The money NEVER becomes your money. It has been paid to you in error. Your best response is to write to the company who has paid you in error and tell them that for the responsibilty and subsequent stress caused to you by them putting you in a position of looking after their money you hereby give notice that you are charging them $50 per week until such time as they request the repayment of their money. Keep a dated copy of your letter and if they fail to respond then in 12 weeks they will have to pay you $600 to retrieve their $600. If they come back to you anytime after that they will OWE YOU money - but I wouldn't push for payment on that one.

I have successfully used this approach with companies who send unsolicited goods and expect me to mess about returning them if I don't want them. I tell them the weekly fee I am charging them for storage and they quickly make arrangements to either take their goods back or (in one case) told me to keep them.

Answer 3

This actually happens quite a bit in the other direction. That is, people leave money with companies (especially banks and insurance companies) and for some reason don't reclaim it. US law is very clear in that instance: the money never becomes theirs. In the event that the rightful owner can't be found, the law of escheat says that the money reverts to the state, but the rightful owner still has title and, if they are ever found, the funds revert to them. There is no statute of limitations.

This is the basis for the letters and emails you sometimes get (both legitimate and illegitimate) saying "there is free money in your name". It could be that you overpaid a bill and didn't notice, and the company lost track of you. Or you received a check that you never cashed. The most frequent cause is that the rightful owner died and the heirs (or executors) didn't know about the asset and is "sort of disappeared".

I haven't the foggiest notion whether escheat applies to individuals or not. (That's why we have lawyers--not that I'd pay money for a legal opinion in this case.)

Legally, no one (other than the government) can force you to accept a contract. (It's called duress and it makes the contract invalid.) So legally, even though the money is always theirs, they can't demand interest on it because you never made a contract (verbal contracts are legally binding, at least up to a certain threshold, once upon a time $1000 but I have no idea today--varies by state). My moral sense agrees with this: they didn't invest this money with you, they just made a mistake. They're entitled to have the mistake reversed, but not to profit from it.

Answer 4

You should actually contact the company, not just try to.

There are ways to do this. For example, show up in person, send registered mail.

All other advice is moot until you actually contact the company.

Answer 5

Here is what happened: The company delivered a mattress, so you owed them $600. They used a credit card company to get the payment from you, so your money went to the credit card company, which passed it on to the mattress company, and you didn't owe anything for the mattress anymore. The company should have refunded a small amount, and should have asked the credit card company to refund a small amount, say $20 (just guessing so we have a number). The credit card company instead refunded $600.

That money is yours. What happened there is just between you and your credit card company. However, since the mattress company now hasn't received any money from you, you still owe the mattress company $580, and they can ask you for that money for quite a long time, once they get their act together. Probably two or three years.

Answer 6

Once you've made a good-faith effort to straighten the situation out you've done all you can do. Cash the check.

Answer 7

The money is still their money, it never becomes your money. The reason is as follows,

A debt of money is incurred at the time that the service in question is rendered

1. When you ordered the mattress, you owed them $0 since no service had been rendered.
2. The instant the mattress was delivered, your debt to them is $600, which you paid.

The books now look like this:

YOU: Asset: Mattress Liability: 600

THEM: Asset: 600 Liability: Mattress

Now, in their books, they mistakenly thought the mattress was returned, and therefore they returned the mattress to you.

The books now look like this

YOU: Asset: Mattress Liability: 600

THEM: Asset: Mattress (incorrect) Liability: 0

As you see, their books are wrong, but yours are still correct. According to your books, you owe them $600, which you paid, but then they paid you back. You still have the liability.

Why not just depreciate the mattress by 50% over two years? Then there will be no liability on your books.

Answer 8

Just like with IRS refunds issued in errors, after 3 years it's legally yours, they can't go after you anymore. So savings account until then or just mail them a check if that is what your conscious is saying.