Advance payment or advance payment is a term used in legal documents and denotes an advance payment, any part or the entire amount of settlements under a concluded purchase and sale agreement. Prepayment is used when the agreement contains the buyer’s obligation to pay in full or in part for the goods before the seller delivers them within the period specified by the prescribed conditions or Article 314 of the Civil Code of the Russian Federation.
It is provided for a wide range of services and goods, and is introduced as a guarantee of the fulfillment of the agreement between the buyer and seller. Many people are interested in whether the prepayment is refundable or not. Let's find out in this article.
Cases are different
Sometimes situations arise when you need to cancel a completed transaction and return the advance payment. There may be many reasons contributing to this development of events. For example, after making a deposit to purchase a car, the buyer urgently needed money. Or an advance payment was made for repairs, but it turned out that they were of poor quality.
How can I return my prepayment? When is this not possible? To find out the answers to these questions, you need to familiarize yourself with the relevant norms that are prescribed in the Civil Code and the Law “On the Protection of Consumer Rights”. So, is the advance payment refundable or not?
What to do if the store refuses to refund your money?
It happens that a store refuses to return money, citing list No. 55 dated January 19, 1998. If the decision to refuse is made due to an incorrect interpretation of the Law “On Protection of Consumer Rights,” then the buyer has the right to file a claim in court.
The claim is drawn up on the basis of documents that were submitted to the seller along with the claim. In the text of the appeal you must indicate:
- name of the court;
- Full name of the consumer, his place of residence and telephone number;
- name of the seller with legal address;
- a description of the circumstances of the purchase and filing a claim with the seller;
- request for refund;
- list of applications;
- date and signature.
A citizen also has the right to claim a fine from the store for violating the deadlines for satisfying a claim, payment of a penalty and compensation for moral damage.
Types of prepayment and its specifics
The Civil Code of the Russian Federation regulates the legal norms of relationships related to the conditions of prepayment. Here the main rules are established to ensure the correct order of this procedure.
Since sales contracts include various forms of payment with various conditions of legal relations, prepayment can be divided into the following types:
- full: the client pays the entire cost of the contract;
- partial (advance): incomplete payment for goods by the established amount or percentage of the amount;
- revolving – constant conclusion of a transaction with advance payment over a long period of time.
Is prepayment for services refundable? More on this later.
When a refund of prepayment is not possible
The purchase and sale agreement does not always fall within the scope of the Law “On Protection of Consumer Rights”. A transaction between individuals is regulated by the norms of the Civil Code of the Russian Federation. For example, a condition for prepayment in the form of a deposit is often put forward when selling an apartment.
In this case, different rules apply, since the deposit not only serves as an advance payment, but also ensures the fulfillment of the obligation . If the parties agree to terminate the legal relationship between them, then the deposit, like the advance, is returned. But if the deal breaks down due to the fault of the buyer, then the money cannot be returned (Part 2 of Article 381 of the Civil Code of the Russian Federation).
The seller bears a more severe liability if the obligation terminates due to his fault. Then he returns the deposit in double amount . The culprit is obliged to pay the losses incurred by the other party as a result of the cancellation of the transaction.
Differences between advance and deposit
Many people confuse advance and deposit, thinking that they are the same thing. However, in reality these concepts have significant differences. Often, the contract establishes one of these types of prepayment; citizens do not know what the difference is between them, although it is very important when returning funds.
A deposit is a strict type of advance payment regulated at the legislative level. It performs the following functions:
- serves as evidence of the conclusion of an agreement;
- serves as a guarantor of the fulfillment of the obligations undertaken by the parties.
The procedure governing the return of the deposit is established by law. If the client refuses any service for which a deposit has already been paid, it will not be returned. However, in the case where the supplier is at fault for non-fulfillment of the service, he must pay a double deposit. Is the advance payment refundable or not? A lawyer can help you figure this out.
An advance is a simple prepayment, most often used for preliminary expenses of the supplier. It is returned in the usual way: if the service is not provided, the client has the right to demand back his advance payment. It is not regulated at the legislative level. Payment must be made in writing, at least in the form of a receipt. If it is the deposit that is specified, it is recommended to conclude an additional agreement.
How to return an advance payment for an item?
If a product is purchased with a mandatory prepayment, you must draw up a purchase and sale agreement in writing, which will indicate the full name of the product, specify the delivery time, fix the amount of the prepayment or a percentage of the total cost and the calculation procedure. Is advance payment for goods refundable?
Having made an advance payment, the buyer can return it in the following cases:
- if the required quality of the product is not met;
- in case of violation of delivery deadlines;
- upon delivery of the wrong product that was ordered.
If, due to the fault of the seller, the buyer does not receive the goods within the specified time frame, then he has every right to demand back the previously paid advance payment, unless an additional agreement has been concluded to set new deadlines or postpone them. In this case, you can demand that the seller pay a penalty amounting to 0.5% of the total prepayment amount for each day overdue.
Is the prepayment for services refunded if I cancel them? More on this below.
Is it legal to prepay for services that cannot be refunded?
Nowadays, many specialists working in the beauty industry ask for advance payment as a guarantee that you will come to the session. Moreover, almost everywhere it is indicated that such an advance payment is non-refundable. We'll tell you whether it's legal and what to do to get your money back.
In an ideal situation, along with signing up for a session, the master should offer to conclude a paper agreement on the provision of paid services. This means that you must pay for the work in full and the technician must complete it. However, in reality such a situation is extremely rare.
At the same time, by signing up for a session, you still enter into a contractual relationship. Here it all works like this: you called or wrote and asked for a service to be provided on a certain day and time. The specialist agreed and confirmed the recording. Thus, you requested a service, and the master took responsibility for providing it. At this point you have entered into a contractual relationship.
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Asking for advance payment is completely legal. This is how people working in the service sector try to protect themselves. For him, your money is a guarantee that you will not forget about the session.
Whether you agree to contribute part of the funds or not is your choice. If you do not agree, then you are simply not registered, and no contractual relationship occurs.
The law does not stipulate a clear amount of prepayment. It could be 5%, 25%, or 90%.
What should you do if you paid part of the amount but were unable to arrive at the appointed time? By law, you are required to return the entire portion of the funds minus the actual expenses incurred. Let's say you signed up for coloring, partially paid for the session, and the hairdresser specifically bought paint of a certain shade. In this case, you have the right to receive back the entire portion of the advance payment, with the exception of the cost of hair dye. The same applies to other situations. If the stylist spent money on nail polish, hairpins, and jewelry specifically for your case, he has the right to take this part of the funds for himself.
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Failure to return the advance payment is called illegal enrichment. Remind the master about this if he does not want to return the money.
- By signing up for a session, you and the master enter into a contractual relationship. This works even if no written contract has been drawn up.
- The amount of prepayment is not regulated by law.
- You must be refunded the entire amount excluding actual expenses incurred. This category includes everything that is purchased specifically for your needs.
You should always remember basic respect. Demanding a refund if you decided not to come to the session without a good reason and reported this 5 minutes before the start is impolite.
Making a claim
If a refusal to refund the entire amount of the prepayment is received, then it is necessary to make a claim or statement against the seller in writing, which will describe such criteria as: name of the product, amount of the prepayment, delivery time, time of delay and the requirement for the seller to pay a penalty from that day, to which, according to the contract, the goods must be transferred. The claim must be made in two copies, and one of them is given to the seller or his legal representative for signature. You also need to indicate the date it was received.
If the product was not purchased ready-made, but was ordered from its manufacturer, then the buyer has the right to demand 3% of the entire prepayment amount for each day overdue.
If the seller fails to pay the penalty within ten days after the buyer’s request, the latter may require payment of interest on the use of his funds. If, after the expiration of the legally established period, the prepayment amount has not been returned to the buyer, then he needs to go to court with this claim in order to resolve the conflict in court.
To competently draw up a claim or statement of claim, it is recommended to contact specialists who protect consumer rights. It is also worth noting that the buyer’s demands cannot be satisfied if the seller manages to prove that the obligations were violated due to circumstances beyond their control or due to the fault of the former. So, prepayment is not refundable; we have explained how to write a claim.
How to return an advance payment for a service?
Most often, an agreement is concluded for the provision of any services, which stipulates the conditions under which the advance payment can be returned. If such are present, then the buyer has the right to terminate the contract and demand a refund of his funds. Prepayment is not refundable in the following cases:
- upon proper fulfillment of the obligations specified in the contract;
- when performing the service within the prescribed period;
- with good quality of service provided.
If the terms for providing the service are violated, the buyer has the right to demand that the contractor pay a penalty in the amount of 3% of the amount paid by him for each day of delay. If the client does not want to terminate the agreement, then he can set a new deadline for the contractor. In what cases is the advance payment refunded?
Is it possible to get my money back?
Requesting an advance payment is quite popular among sellers. They often stipulate in the contract that the deposit will not be returned if the buyer refuses the transaction, thereby breaking the law.
The fact that the consumer has every right to refuse a purchase at any time before the transfer of goods, performance of work or provision of services is stated in Art. 497 Civil Code of the Russian Federation. In this case, the buyer is obliged to compensate the retail outlet for the costs incurred. The same rule is contained in the Law on Protection of Consumer Rights. In case of refusal, the advance must be returned.
Note!
Rospotrebnadzor considers only the requirement of a deposit illegal. The department notes that this violates consumer rights and recommends refraining from transactions with such requirements.
If the transaction does not take place for a reason beyond the control of the consumer, he also has the right to a refund of the prepayment by law. In this case, you can return the prepayment under the contract in full. This rule may be changed by the purchase and sale agreement, so it is important to read its terms carefully. If the product is quite expensive, you should show the agreement to a lawyer in advance so that he can assess its legality.
The most commonly used methods for returning prepayments for services, work and goods:
- termination of the concluded purchase and sale agreement;
- drawing up a separate application addressed to the seller.
A competent claim for a refund of the prepayment for the goods can help resolve the problem in your favor. Hand it over to the seller against signature. In the text, indicate the details of the purchase and sale agreement, the grounds for returning the advance payment, and links to legal provisions that allow you to demand your money back. If you are not sure that you will draw up a claim correctly, entrust this work to a lawyer. Even if this document seems like a mere formality to you, it can significantly increase your chances of getting a refund of the advance payment for the goods simply because many stores do not want to get involved in litigation.
A refund of the advance payment is also possible if the seller broke his promises and did not sell the goods within the period specified in the sales contract. Even before signing, check whether the agreement contains a specific deadline for the transfer of products. If not, ensure that this paragraph is included in the text. Otherwise, it will be very difficult for you to receive the paid product. If you doubt the legality of the contract and the integrity of the retail outlet, involve a lawyer in the matter.
If the seller violates the terms, you have the right to the following actions of your choice:
- set a new deadline and require the goods to be transferred before its end;
- demand a refund of the advance payment.
Refunds of prepayment for undelivered goods must be made within 10 days. In addition, the seller is obliged to compensate you for losses, and for each day he must pay a penalty - half a percent of the amount of advance payment for the goods. If a retail outlet violates the requirements of the law, you will have to seek a refund of the advance payment for undelivered goods through the courts.
Termination of an agreement
In case of termination of the contract, the buyer must write a corresponding statement and bring it directly to the supplier. If the organization with which the transaction was concluded is serious and respects its principles, then, most likely, it will not spoil the opinion of itself and will meet the buyer halfway. The money will be fully refunded even when the supplier did not suffer losses from the client’s refusal.
If any expenses were incurred, the amount will be returned excluding expenses. Most often, such subtleties are established in the contract. In the case where the supplier does not want to give the money voluntarily, the buyer needs to file a claim according to the standard scheme. If it was sent to the address, then the money for the service not provided must be returned within ten days.
If this requirement is ignored, the buyer can expect to pay a penalty. It must be remembered that the claim is submitted in two copies, one of which remains with the buyer (with the seal and signature of the organization supplying it src=»https://businessman.ru/static/img/a/46695/338732/52862. jpg" class="aligncenter" width="640″ height="360″[/img]
What if you haven't responded to your complaint?
If the seller has not responded to the claim within ten days or has received a refusal, the buyer has the right to file a claim in court. The latter should include a calculation of damages. This amount may include:
- the entire amount of advance payment;
- the amount of the penalty in case of violation of deadlines;
- interest on the use of other people's funds;
- compensation for damage caused by violation of deadlines;
- amount for moral damage.
If the court decides that the buyer is right, then, in addition to the payments listed above, he is entitled to a fine amounting to 50% of the total amount of damage, including moral damage, as well as payment of costs associated with participation in court.
Deposit or prepayment - what is not refundable? This is a common question.
The complaint remained unanswered
If ten days have passed since the claim was submitted, and the seller has not responded to it in any way or has refused, then the first one can write a statement to the court. The requested amount includes:
- full amount of advance payment
- the amount of the penalty when deadlines are violated
- percentage of the use of other people's funds
- the amount of damage caused due to missed deadlines
- amount for moral damages
Also, if the buyer wins the case, the seller additionally pays half the fee of the entire payment amount.
Thus, in order to return a pre-paid payment, it is necessary to take into account some nuances and subtleties. Therefore, in order to carry out actions correctly, it is worth seeking advice from specialists.
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