AJust wondering if anyone has had problems with anyone trying to get their money back for any reason or trying to make you do something or to get something they shouldn't just because it isn't stated in writing even though it's implied. Just curious
The law won't protect you if it's implied. You're leaving it in the hands of a judge who knows nothing about your character or profession, and will be hearing from people who have no problem lying to get a few bucks... I'm not that trusting!! 
I have an iron clad contract, my dad is an attorney, so he helped me write it with every scenario we could think of...and can change if specific instances arise in the future. I only do this VERY part-time ...a cake or 2 a month, but I wanted to be covered in case Sue-Happy-Sandy decided to cause trouble.
It states the only reason for a refund is if the cake isn't ready or delivered at the specified time. Any other reason, it may be a credit towards another cake, but it specifically states that flavor and texture are subjective and not issue for refund. If they accept and keep the cake, no refund, no credit. If they decide to return the cake and it doesn't meet MY (and SOLELY MY) standards, a credit may be issued. I didn't want any wiggle room for implications or gray areas. A date isn't booked until I have a signed contract and full payment.
It may sound harsh, but growing up hearing how people take advantage of others, I made my contract before my pricing menu!!
Protect yourself, unfortunately, there are people who are looking for ways to exploit anyone who doesn't have themselves protected. Spell it out exactly so there is no question, it's not a fun thing to write but it'll save you an even bigger headache later on. If you hand them a contract and they balk, walk away!!
The law won't protect you if it's implied. You're leaving it in the hands of a judge who knows nothing about your character or profession, and will be hearing from people who have no problem lying to get a few bucks... I'm not that trusting!!
I have an iron clad contract, my dad is an attorney, so he helped me write it with every scenario we could think of...and can change if specific instances arise in the future. I only do this VERY part-time ...a cake or 2 a month, but I wanted to be covered in case Sue-Happy-Sandy decided to cause trouble.
It states the only reason for a refund is if the cake isn't ready or delivered at the specified time. Any other reason, it may be a credit towards another cake, but it specifically states that flavor and texture are subjective and not issue for refund. If they accept and keep the cake, no refund, no credit. If they decide to return the cake and it doesn't meet MY (and SOLELY MY) standards, a credit may be issued. I didn't want any wiggle room for implications or gray areas. A date isn't booked until I have a signed contract and full payment.
It may sound harsh, but growing up hearing how people take advantage of others, I made my contract before my pricing menu!!
Protect yourself, unfortunately, there are people who are looking for ways to exploit anyone who doesn't have themselves protected. Spell it out exactly so there is no question, it's not a fun thing to write but it'll save you an even bigger headache later on. If you hand them a contract and they balk, walk away!!
That's not harsh at all. I was thinking the same thing. It aggravates me when people have to try to take advantage of people and situations. I'm not giving store credit at all, and no refunds unless for some reason i can't go through with something or a customer cancels before I've made the order. all other reasons are not reasons for a refund.
I saw a huge increase in the last year of people trying to get money back for no reason. Not just with me, but with friends who are in other areas of the wedding industry, or other bakers in different parts of the country. People have started trying to get refunds as a cost-cutting measure, or so it seems. Pay too much in the first place, then complain to get maney back after the fact.
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Original message sent by costumeczar
I saw a huge increase in the last year of people trying to get money back for no reason. Not just with me, but with friends who are in other areas of the wedding industry, or other bakers in different parts of the country. People have started trying to get refunds as a cost-cutting measure, or so it seems. Pay too much in the first place, then complain to get maney back after the fact.
I also use an iron clad contract, some of the best money I've ever spent was getting my contracts written by a lawyer.
Since I have started using that, I haven't had a single person try to pull the refund stunt, (knock on wood!)
Most of my orders are large as well, I really don't get many birthday cake type orders, I think that makes a big difference. Reading on the forums here, it seems like it's the smaller cakes that usually get that kind of nonsense.
I've only ever had two people want money back, before I used a contract. One lady ordered too much cake and tried to return the bottom tier, thinking I could resell it, she was really sweet, just not too brainy :P
The other kept changing her mind as to why she deserved a refund, I wasn't very experienced at running a business at the time and let her walk all over me, ended up giving her 50% back.
The other kept changing her mind as to why she deserved a refund, I wasn't very experienced at running a business at the time and let her walk all over me, ended up giving her 50% back.
Oh lordy...I call that the roaming complaint. It keeps changing until you cave and give them money back.
I don't know if putting something about no refunds for any reason would be legal. You can always refuse to work with someone if they seem like they're going to be a problem, but if someone says that you sold them a burnt cake I doubt that you could point to the contract that says that texture is subjective and have that hold up.
I've also found that the smaller cakes come with the biggest headaches. The first birthday people are the craziest, brides have nothing on them.
Oh lordy...I call that the roaming complaint. It keeps changing until you cave and give them money back.
I don't know if putting something about no refunds for any reason would be legal. You can always refuse to work with someone if they seem like they're going to be a problem, but if someone says that you sold them a burnt cake I doubt that you could point to the contract that says that texture is subjective and have that hold up.
I've also found that the smaller cakes come with the biggest headaches. The first birthday people are the craziest, brides have nothing on them.
It IS completely binding and legal! I have the taste/texture clause in my contract as well as outlining the only reason for a refund is not having the cake ready for pick-up/delivery. Fortunately, we have 5 lawyers in my immediate family, so seeking legal advise is easy (and sometimes not always wanted). If you sign the contract, it is binding and 99.9% of times, that alone is enough to keep someone from attempting to sue. The other .1% is just sue-crazy anyway, but those people aren't going to want to do business with someone who presents them a legal contract.
If you're a professional, you're not going to be selling a burnt cake and if you do, they have to bring you the remainder for your examination and compensation in the form of another cake is written into the contract.
Legal hat off...
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Original message sent by sixinarow
It IS completely binding and legal!
Interesting, but I do know people here who have sold burned cakes, so if they got sued (and they should, they're jerks) I would hope a contract that said texture is subjective would be thrown out by any judge who had a brain.
On the other hand, that kind of thing would eliminate one of the roaming complaints that people throw out to try to get you to give them a refund. Although the one time I had a real psycho to deal with she said "the contract doesn't matter" then disputed the credit card payment.
AExactly why I started this thread, I knew there are people out there that would try to get a refund for any reason even if there is a contract. I agree with sixinarow that good bakers won't sell a burnt cake. I'm going to be selling large orders of cupcakes so I should probably have a contract or something. I'm not going to allow people to pay the full amount on a credit card so they wouldn't get all their money back anyway if they tried disputing it but I guess if people can get any amount back they will try.
ADisputing a credit card bill is an easy way for customers to get their money back if they aren't satisfied with a purchase. It would be pretty difficult for a vendor to adequately refute a customer's claim that their cake was dry, didn't taste good, etc. If they lose the dispute, the vendor's only recourse is small claims court and collections, and for a small debt it may not be worth it.
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Original message sent by jason_kraft
Disputing a credit card bill is an easy way for customers to get their money back if they aren't satisfied with a purchase. It would be pretty difficult for a vendor to adequately refute a customer's claim that their cake was dry, didn't taste good, etc. If they lose the dispute, the vendor's only recourse is small claims court and collections, and for a small debt it may not be worth it.
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Original message sent by BakerBee7468
Someone needs to come up with a way to stop people from filing bogus claims like this. Not sure how credit card companies could stop/ limit this aside from asking for more proof in someway. Maybe there could be stipulations, like the customer having to return the cake uneaten except for a few taste bites. Or excluding reasons for disputing food items.
I know that one of my friends was dealing with a client who gushed about how great the cake was, then turned around and disputed the paypal claim for no reason. Of course she wouldn't answer emails about it, so my friend was left to deal with paypal. After a few days of back and forth she got a guy who basically told her that because the complaints about a cake are subjective they just have to side with the customer most of the time, and the only way to protect yourself against that kind of thing was to take cash only.
Having said that, I saw one person's website somewhere recently that said that if someone disputed a credit crd payment for false reasons they would turn the amount over to a debt collection agency immediately and it would affect the customer's credit rating. I forget who had that on their site but I was intrigued...
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Original message sent by BakerBee7468
Someone needs to come up with a way to stop people from filing bogus claims like this. Not sure how credit card companies could stop/ limit this aside from asking for more proof in someway. Maybe there could be stipulations, like the customer having to return the cake uneaten except for a few taste bites. Or excluding reasons for disputing food items.
The profitability of credit card companies is tied directly to how many customers use their card and how much they charge to it, so adding restrictions to the dispute policy would not be in their best interest. Requiring the cake to be returned uneaten also may not make sense from the customer's perspective for a subjective issue...if a customer's wedding cake's taste or texture was not up to the standards they expected, most people wouldn't tell the venue to hold back what is likely the only dessert unless the cake actually was inedible instead of just mediocre. There are also logistical issues like where the uneaten cake will be stored until it is returned to the vendor.
As costumeczar mentioned, the best way to avoid this is to not accept credit cards or paypal in the first place. It is still possible for customers to stop payments on personal checks but this is not free and it generally requires more effort. Even better than this is having a strong competitive advantage so customers will want to maintain a good business relationship with you for future orders.
Regarding sending unpaid accounts to collections, you don't need a specific disclaimer to do this. If a customer does not pay what they owe (whether they didn't pay at all or paid and then took it back) and does not attempt to work out a resolution with you, you automatically have the legal right to collect that debt on your own or via a collection agency. It can't hurt to include this on the contract, as customers may be under the impression that a credit card dispute also cancels the underlying debt.
The relevant law that outlines how you can attempt to collect debt is the Fair Debt Collection Practices Act (FDCPA), violating FDCPA rules can lead to lawsuits and fines/penalties. http://credit.about.com/od/debtcollection/tp/fdcpa-violations.htm
The profitability of credit card companies is tied directly to how many customers use their card and how much they charge to it, so adding restrictions to the dispute policy would not be in their best interest. Requiring the cake to be returned uneaten also may not make sense from the customer's perspective for a subjective issue...if a customer's wedding cake's taste or texture was not up to the standards they expected, most people wouldn't tell the venue to hold back what is likely the only dessert unless the cake actually was inedible instead of just mediocre. There are also logistical issues like where the uneaten cake will be stored until it is returned to the vendor.
As costumeczar mentioned, the best way to avoid this is to not accept credit cards or paypal in the first place. It is still possible for customers to stop payments on personal checks but this is not free and it generally requires more effort. Even better than this is having a strong competitive advantage so customers will want to maintain a good business relationship with you for future orders.
Regarding sending unpaid accounts to collections, you don't need a specific disclaimer to do this. If a customer does not pay what they owe (whether they didn't pay at all or paid and then took it back) and does not attempt to work out a resolution with you, you automatically have the legal right to collect that debt on your own or via a collection agency. It can't hurt to include this on the contract, as customers may be under the impression that a credit card dispute also cancels the underlying debt.
The relevant law that outlines how you can attempt to collect debt is the Fair Debt Collection Practices Act (FDCPA), violating FDCPA rules can lead to lawsuits and fines/penalties.
http://credit.about.com/od/debtcollection/tp/fdcpa-violations.htm
Great information to have and hold on to, thanks Jason!
costumeczar is right about the roaming complaints, I tried to do everything I could in the contract sense to prevent as many as possible. I can't control how other people run their business or the quality of their products and if there is a dispute over a burnt cake, that would probably take mediation in some form or other to work out...hopefully with the burnt cake baker being out some moolah. Now, if it would hold up in my favor in a court of law with who-knows-what-judge hearing the case, is another story. Justice is only as blind as the judge who reigns over the scales, so there's always a chance things will not go your way with the legal system. No contract is 100% guaranteed, in favor of vendor or client, iron-clad is a reference to the contract being without reproach, everything laid out is legal and it would not be easily thrown out in court. I do feel a solid contract will weed out a lot of problems before they gain traction. I think a lot of roaming complainers would probably look at a solid contract and decide to go with someone who didn't have a detailed contract so they had a better chance of getting something-for-nothing.
AGreat information to have. I'll keep this in mind.
I do have a clause in my contract that says that any legal action has to go through BBB mediation services since I'm a member and can use them for free. That way if anyone takes me to court they'll probably have the case dismissed if they haven't used mediation and they'll have to pay my legal costs (also in my contract.) It doesn't stop people from being jerks but it slows them down 
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Original message sent by costumeczar
I do have a clause in my contract that says that any legal action has to go through BBB mediation services since I'm a member and can use them for free. That way if anyone takes me to court they'll probably have the case dismissed if they haven't used mediation and they'll have to pay my legal costs (also in my contract.) It doesn't stop people from being jerks but it slows them down :roll:
Sorry if this is slightly off topic and not specifically about returns, but speaking of contracts in general... I'm just curious, how long is everyone's contract??
I became a home based business under the new CA Cottage Food Law earlier this year (YAY!) and spent about 80% of my start-up capitol on my contract written by a business lawyer and double-insurance coverage---it's the best money I spent for my business as it gives me more peace of mind. The contract is very detailed and outlines just about every possible situation...but it seems really long. Customers have signed it without any problems, but I do get some raised eyebrows when they see it and say, "I'm just buying cake, right?!" or that the storefront bakeries in town don't require them to sign a contract, and if they do, it's not such an extensive contract. Even the lawyer questioned whether I really wanted all the various details and make it that much longer--to which my response was yes, whatever I need that will also hold up legally if there are any issues with crazy, sue-happy customers ;0)
Has anybody else had such reactions to the length/detail of your contract, and if so, how have you responded?
AWhat are all the situations that are covered in your contract? Maybe you could keep everything in the contract but condense it so its not so long.
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Original message sent by costumeczar
I do have a clause in my contract that says that any legal action has to go through BBB mediation services since I'm a member and can use them for free. That way if anyone takes me to court they'll probably have the case dismissed if they haven't used mediation and they'll have to pay my legal costs (also in my contract.) It doesn't stop people from being jerks but it slows them down :roll:
How does your liability insurance tie in with this? Do they still pay out on a liability claim if it is resolved against you in mediation?
IMO the biggest problem would probably be customers clawing back payment (in which case the burden is on you to get a judgment and collect) instead of a customer suing you.
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Original message sent by sweetalexjane
The contract is very detailed and outlines just about every possible situation...but it seems really long.
How long is the contract? Our legalese is about one page and is incorporated into the order quote.
AHow do u handle deposits? Say a customer comes in places their order with you, you get your deposit and everything, then later they cancel. Do you refund the deposit, or is your deposit non- refundable, are there rules like if they cancel before you start making their cake they get their money back but if you already started their cake then they don't get it back?
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Original message sent by BakerBee7468
How do u handle deposits? Say a customer comes in places their order with you, you get your deposit and everything, then later they cancel. Do you refund the deposit, or is your deposit non- refundable, are there rules like if they cancel before you start making their cake they get their money back but if you already started their cake then they don't get it back?
Deposits are typically non-refundable, since they are more to hold the date than anything else. Some actually call them retainers to emphasize this.
Of course non-refundable does not mean that a deposit will never be refunded under any circumstances. If the customer cancels within the first few days or if there is a good reason to cancel or change the date down the road I would return the deposit.
My contract covers; 1) Payment Terms and Reservation of event date 2) Changes to the order 3) Postponement and Cancellations 4) Delivery/Set-Up, Pick-Up 5) Preparation of Baked Goods (includes dietary warnings, flowers, and cottage food label/menu requirement) 6) Photographs 7) Liability 8) Termination (by me or customer) 9) General Provisions. I used a sample contract I found here on CC a long time ago as my starting point. It too was very extensive as I think it was a compilation of all the recommendations from CC members but put together by one person...I wish I could find the thread that has the file in it! I took out parts that I felt I didn't need and then took it to my business lawyer for fine tuning and make it applicable to my state/county. It needed a lot of re-writing, as many of the clauses in the compilation/sample contract were based on laws in England and therefore needed to reflect CA law instead.
Even though I want to keep all the different sections/parts of the contract, I asked my lawyer about condensing the wording...but he felt that the wording needed to remain how it was written for the legal protection :0(
I'm thinking of playing with the margins and the font size to reduce the number of pages, lol!
One page?! Okay...mine is definitely way too long then, lol! But...I don't want to throw it out or go against the legal advise I got from the business lawyer who wrote it and just start cutting things out--especially since I spent most of my start-up monies on having it done.
And all of my customers have been signing it, so it doesn't seem to be an issue...just curious about a way to respond when they comment about the detail or length of it. The voice in my head says "...because I don't want to lose my house over a cake in case someone is going to be a crazy, sue-happy customer". Any suggestions on how to translate that to a more professional explanation to the customer?
I know that one of my friends was dealing with a client who gushed about how great the cake was, then turned around and disputed the paypal claim for no reason. Of course she wouldn't answer emails about it, so my friend was left to deal with paypal. After a few days of back and forth she got a guy who basically told her that because the complaints about a cake are subjective they just have to side with the customer most of the time, and the only way to protect yourself against that kind of thing was to take cash only.
In my day (real) job -I've noticed that Paypal always sides with the customer-even if Paypal or the customer are in the wrong. We had one customer order, buy and receive his product and then Paypal refunded him the money. We tried to go via Paypal to get our payment back- and they were no use at all, saying the client asked for a refund.
After months and months of getting nowhere with Paypal (they kept handing our case off to someone else within the company), I finally called the client (in California) myself (from Asia) and asked what was up?!
He said he loved the product and didn't know why Paypal refunded his payment (he said he didn't ask for refund). In end, he made another payment to us and it was settled...but Paypal was of no use whatsoever- even with their own mistake.
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Original message sent by sweetalexjane
My contract covers; 1) Payment Terms and Reservation of event date 2) Changes to the order 3) Postponement and Cancellations 4) Delivery/Set-Up, Pick-Up 5) Preparation of Baked Goods (includes dietary warnings, flowers, and cottage food label/menu requirement) 6) Photographs 7) Liability 8) Termination (by me or customer) 9) General Provisions. I used a sample contract I found here on CC a long time ago as my starting point. It too was very extensive as I think it was a compilation of all the recommendations from CC members but put together by one person...I wish I could find the thread that has the file in it! I took out parts that I felt I didn't need and then took it to my business lawyer for fine tuning and make it applicable to my state/county. It needed a lot of re-writing, as many of the clauses in the compilation/sample contract were based on laws in England and therefore needed to reflect CA law instead.
Even though I want to keep all the different sections/parts of the contract, I asked my lawyer about condensing the wording...but he felt that the wording needed to remain how it was written for the legal protection :0(
I'm thinking of playing with the margins and the font size to reduce the number of pages, lol!
One page?! Okay...mine is definitely way too long then, lol! But...I don't want to throw it out or go against the legal advise I got from the business lawyer who wrote it and just start cutting things out--especially since I spent most of my start-up monies on having it done.
And all of my customers have been signing it, so it doesn't seem to be an issue...just curious about a way to respond when they comment about the detail or length of it. The voice in my head says "...because I don't want to lose my house over a cake in case someone is going to be a crazy, sue-happy customer". Any suggestions on how to translate that to a more professional explanation to the customer?
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Original message sent by cazza1
I would be very interested to know if this problem with people trying to get free cakes is mainly an American thing or if it is happening widely in other countries as well.
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Original message sent by cakefat
In my day (real) job -I've noticed that Paypal always sides with the customer-even if Paypal or the customer are in the wrong. We had one customer order, buy and receive his product and then Paypal refunded him the money. We tried to go via Paypal to get our payment back- and they were no use at all, saying the client asked for a refund.
After months and months of getting nowhere with Paypal (they kept handing our case off to someone else within the company), I finally called the client (in California) myself (from Asia) and asked what was up?!
He said he loved the product and didn't know why Paypal refunded his payment (he said he didn't ask for refund). In end, he made another payment to us and it was settled...but Paypal was of no use whatsoever- even with their own mistake.
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