Unclaimed goods – retailers’ obligations and customers’ rights

Do you know what to do with unclaimed goods?

If a customer leaves goods at your shop for repair or cleaning and doesn’t collect them, you can’t just dispose of them as you see fit!

Sometimes customers don’t pick up goods after they have requested something be repaired, or refuses to pay the bill and collect the goods after the work has been done. Drycleaners, jewellers, shoe repairers, picture framers, mechanics or other retailers that hold unclaimed goods often face this situation.

There are specific rules in the Contract and Commercial Law Act about what you can do in this situation. After two months, you can sell the goods at auction — but there are rules about how you do this, and what you do with the money.

Before you send anything off to auction you must:

  • give the customer one week’s notice in writing; or
  • advertise your intention to sell the goods in the local newspaper.

The notice must be provided by:

  • delivering it to the owner; or
  • leaving it at the owner’s usual or last known place of residence or business or at any address specified by the owner for that purpose; or
  • posting it in a letter addressed to the owner, either at an address provided or at their place of residence or business.

The notice and the advertisement must include:

  • your business’s name;
  • the amount of money owed;
  • a description of the goods;
  • the time and place of sale; and
  • the name of the auctioneer.

If the goods are sold at auction you must use the proceeds of the sale to pay:

  • the cost of advertising;
  • the cost of selling the goods;
  • the costs for transportation and storage of the goods; and
  • the amount of the debt.

If any money is left over, you can’t pocket it or give it away (even to charity). Instead, you must pay to the Registrar of the District Court nearest to the place of the sale, where it will be held for the customer to collect.

And as always, if you have any specific issues in this area or any other, our Advice Service is here to help and can be contacted by email or phone 0800 472 472 (1800 128 086 from Australia).

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