Restaurant closed down, deposit not returned

[Edieunion]

We had a family booking for Christmas that we had to pay a deposit for, per head. The restaurant has just unexpectedly closed down and are now not responding to emails or phone calls. We had to pay via bank transfer...does anyone know where we stand with getting this money back?

If you paid via credit card ask them (if over £100)

Bank transfer is a problem. If you'd paid by credit card you'd be able to get your money back, but in this case I think you'll just have to join the queue of creditors.

I’m afraid as far as I’m aware you are now a creditor, and will be at the back of the queue with the inland revenue and staff owed wages going before you. You would have to register your claim with the administrators, but I wouldn’t put much hope in this.

If the restaurant is bought by someone else, it’s very possible they will honour your deposit as a good will gesture, but there is no legal obligation for them to do so. I worked for a restaurant chain that was bought over, and the new owners honoured all deposits and gift vouchers to create good feeling with the locals.

Do you know where the owners are? Were they set up as a limited company or sole proprietor/ partnership?

As it's a bank transfer, then at best it will take some time to get the money back, at worst you'll need to write it off.

They wouldn't allow a credit card as a deposit at the time and as it appeared a popular restaurant we didn't think much of it. It is still showing as active on companies house.

@Edieunion

They wouldn't allow a credit card as a deposit at the time and as it appeared a popular restaurant we didn't think much of it. It is still showing as active on companies house.

I think that sounds a bit dodgy, like they knew they were in trouble, and you should’ve said no. Sorry, I know that doesn’t help you now. How much was it?

@Edieunion

They wouldn't allow a credit card as a deposit at the time and as it appeared a popular restaurant we didn't think much of it. It is still showing as active on companies house.

Being active on Companies House does not mean that they are not insolvent,mit just means nothing has been updated yet.

The reality is you have almost certainly lost they money. Register your claim with the liquidators when they are appointed but be realistic in that you will not be getting it back.

In hindsight I can see that it appears dodgy. £200 in total.

I think that moneys gone now tbh op. I’d give your bank a ring just in case, you are covered in certain situations

Do you know how I can find out who the administrators are please?

Thank you @Winniemarysarah I fear the same but still want to try all I can!

If the company goes into administration or liquidation that will be updated on companies house in due course. If it is indeed insolvent then I think it’s unlikely you will be able to recover the money (and the very earliest any payment would be made would be 6 months) but it doesn’t hurt to put in a claim.

Sorry about your Christmas plans!

If the directors were happy to take your deposit when they knew that the company was likely to go tits up then they can in theory be made personally liable, and required to refund you. It's known as "wrongful trading" (search for it), but wrongful-trading orders from the court are relatively rare.

@MurielSpriggs

If the directors were happy to take your deposit when they knew that the company was likely to go tits up then they can in theory be made personally liable, and required to refund you. It's known as "wrongful trading" (search for it), but wrongful-trading orders from the court are relatively rare.

They are almost non-existent unless you are willing to fund an official liquidator to conduct an investigation which demonstrates that the directors acted deliberately and did so for self-enrichment.

If it were me I would send a letter and notify the liquidator if one is appointed (but as it is a small business it is likely they will just do the minimum and close down), however I would hold out absolutely zero hope of getting anything more than a few pennies back, if that.