David Jones cuts change-of-mind returns to 14 days and stops selling gift cards
David Jones Pty Limited, the Sydney-founded department store chain in voluntary administration and receivership since 5 November, has changed its refund policy: anything bought from 7 November can only be swapped within 14 days if the buyer changes their mind. It has also stopped selling gift cards, though cards and store credit already issued are still accepted.
For goods bought from 7 November, a customer who simply changes their mind can exchange the item within 14 days, and some lines are excluded, according to the updated policy reported by Finder. Goods bought earlier still get 30 days, plus five more for online orders. Clearance stock, gift cards and fresh food cannot be returned at all under the policy David Jones posted online, NewsWire reported. Faulty goods are a separate matter: the receivers, FTI Consulting, said Australian Consumer Law still protects shoppers.
David Jones told Finder that gift cards and store credit already in circulation can still be spent in store under its present trading terms, but it no longer sells new cards. The receivers said any further change to customer arrangements would be announced and the terms and conditions updated. No public statement from the receivers or the administrators has yet dealt with lay-bys, deposits or loyalty points.
On 5 November the directors called in McGrathNicol as voluntary administrators, naming Jason Preston and Shaun Fraser along with Jacinta Neilsen and Matthew Hutton. The same day the secured lender, Hilco, put in FTI Consulting's Christopher Hill, David McGrath and Joanne Dunn as receivers and managers of the parent company, ACP Riley Street Midco Pty Ltd. The receivers run the 38 stores. In a letter to staff reported by AAP, they said pay for ongoing work would continue and they expected enough money to cover entitlements in full. Trade creditors are owed about A$100 million, according to documents reported by the Australian Financial Review and cited by Jeweller magazine. FTI told suppliers that debts from before 5 November now depend on how the administration ends, the ABC reported.
McGrathNicol told the ABC it would send its first circular to creditors on 10 November and hold the first creditors' meeting at 11am on Tuesday 17 November. Expressions of interest from possible buyers close on Friday 13 November.
Why it matters: Gift cards and store credit still work for now, but their holders would rank as unsecured creditors if the business is wound up. The first creditors' meeting is on 17 November, and nothing has been said yet about lay-bys or deposits.
If this affects you
- The ACCC says consumers holding a gift card, credit note or lay-by deposit with an insolvent business usually rank as unsecured creditors, repaid after secured creditors and employees. accc.gov.au
- According to the ACCC, a business trading under administration may honour gift cards or lay-bys, and the administrator can attach conditions, such as an equal extra spend. accc.gov.au
- ASIC's published notices site lists Australian companies under external administration and the practitioners appointed to them. publishednotices.asic.gov.au
Sources
- Voluntary administrators appointed for David JonesRetail World Magazine, Nov 6
- Brands asked to keep supplying David Jones despite unpaid debtsABC News, Nov 6
- Surprising detail after David Jones catastropheYahoo Finance (NewsWire), Nov 8
- No, David Jones hasn't axed your gift card and yes, you can still return thingsFinder, Nov 9
- David Jones a lesson for retailers as staff reassuredAAP News, Nov 10
- David Jones collapses into administration, suppliers owed $100 millionJeweller Magazine, Nov 10