Issuing refund to customer

[jonpaul42]

What is the name of your state (only U.S. law)? NY

We mailed a refund check to a business customer. The check was mailed back to us with a notarized letter stating the business is closed and asking for the refund to be issued to an individual who is presumably the owner.

Assuming the individual is the owner and the company is actually closed, can we refund the individual without any concern that this will come back to haunt us?What is the name of your state (only U.S. law)?

[You Are Guilty]

Originally Posted by jonpaul42

What is the name of your state (only U.S. law)? NY

We mailed a refund check to a business customer. The check was mailed back to us with a notarized letter stating the business is closed and asking for the refund to be issued to an individual who is presumably the owner.

Assuming the individual is the owner and the company is actually closed, can we refund the individual without any concern that this will come back to haunt us?What is the name of your state (only U.S. law)?

How much are we talking here?

I wouldn't issue anything to the individual absent them also signing an indemnity/hold harmless agreement in which they agree to defend & indemnify you/your company in the event the "rightful" owner of the refund (the closed business) decides to sue you for not giving it the money it was owed.

Barring a signed agreement like that, you have no protection whatsoever.

[CraigFL]

Have you checked this out?

[url=http://www.osc.state.ny.us/ouf/]New York State Comptroller[/url]

[cosine]

Originally Posted by You Are Guilty

How much are we talking here?

I wouldn't issue anything to the individual absent them also signing an indemnity/hold harmless agreement in which they agree to defend & indemnify you/your company in the event the "rightful" owner of the refund (the closed business) decides to sue you for not giving it the money it was owed.

Barring a signed agreement like that, you have no protection whatsoever.

Even that protection is not rock solid. If you need to get your money back, better hope the person you gave it to can be found and has not declared bankruptcy.

If the amount of money is substantial, I'd take it to court as an interpleader action (which should be simple and straight forward if the person is the rightful receiver and the business is dissolved). Otherwise, I'd wait and let them come demand the money, and in turn demand from them proof (not just a notarized letter).

BTW, same applies for a collection agency or debt buyer. They need to show proof that they are the assignee of the debt, or I don't treat them as the assignee.

[HelpinMN]

I can't speak as a legal expert but if I were in your situation I would resend it made out to the business. The person who is claiming to be the business owner should be able to go down to their local bank, who presumably would know them as the owner of the business, and they could work something out to get it cashed. Again I am simply speaking as someone who spent a few years working in a bank and dealing with similar situations, this would of course be affected by the amount of the check.

[VeronicaLodge]

i agree, the fact that he closed his business while it was still owed money is his problem, not yours.