Bad news for jilted brides

‘‘To pay for something before you receive it is, in effect, to make an unsecured loan.’’ Consumer NZ

Bad news for brides who have paid a deposit on dresses at failed Auckland bridal boutique Primrose and Finch: They may not see the money again.

The Parnell shop shut without warning and a liquidator was appointed on Wednesday.

But many people have paid thousands of dollars for dresses they had not yet received.

Brides-to-be would visit the Parnell shop, trying on sample dresses before choosing their favourite, which would be shipped to the boutique by the designer and customfitted.

Bryan Williams, of BWA Insolvency, said he had received about 45 phone calls from ‘‘disappointed brides’’ on Friday morning and the calls were still flooding in.

But these customers could be in for a shock because their claim for a refund will probably rank at the bottom of the business’ debts.

As the business’ assets are sold, first to be paid will be secured creditors who have loaned the company money, such as banks. Then will come employees owed wages or holiday pay, and Inland Revenue.

Finally, any money left over can go back to customers and others who are owed money or goods.

If people had paid a deposit on a dress, they could try to claim it back but Consumer NZ said deposits on dresses would be considered last because there was no security offered when the money was paid. ‘‘To pay for something before you receive it is, in effect, to make an unsecured loan.’’

If the deposit was paid by credit card, it might be possible to claim a ‘‘chargeback’’ via the credit card provider.

Any customers who had a lay-by could pay for and collect their purchases if their payments were up-to-date. It is best to do this quickly.