Am I legally obligated to provide a refund?

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Am I legally obligated to provide a refund?

My husband and I run a tiny furniture refinishing business. 2 months ago we made a desk for a client. Almost 2 months later she has done nothing but complain and wants her money back. This was sold as a live edge slab desk. She says the knots are cracking. We researched it and told her how she could fix it. She now wants her money back. How do we know what caused a live edge slab to crack 2 months later? Our page says all sales are final. Are we under obligation give money back?

Asked on April 5, 2018 under Business Law, Oregon

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

No, you only need to provide a refund if:
1) You violated the agreement (whether written or oral) about what you were making for her (e.g. did not follow the contract or specs);
2) You provided defective product; or 
3) You had a policy allowing refunds--which you evidently did not.
So since 3) does not appear to apply, only if you didn't do what she paid to you or provide product defective *when you provided it* would you have to give her a refund. That said, since courts do not "prescreen" lawsuits to make sure they are valid or viable before allowing them to filed, she could sue you for the money, forcing you to defend; even if you have a good defense--as you may well--you'd still have to spend time and effort on the case; money, too, since if your business is an LLC or corporation, you'd have to hire a lawyer to represent it (nonlawyers may not represent LLCs or corporations). Depending on how much money is at stake, it make sense to take the desk back (so you can resell it) and return her money to avoid litigation.


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