Who is liable for unpaid cashback on a Lexmark printer?

On 22 December 2009 I paid £200 for a Lexmark S605 printer at PC World, which came with a £50 cashback offer.

I was assured at the time that once I registered ownership online I would get the money immediately. I registered the printer the next day but I have not received one penny back.

I complained to Lexmark and was told the cashback could take up to 60 days.
David Hadley

Cashback schemes can be grand but often cause people a huge headache. These schemes are designed to entice and often influence a person's buying decision.

Failing to honour these would be a breach of the Consumer Protection Regulations (CPRs). This law was introduced in May 2008 to clamp down on unfair sales and marketing practices.

The CPRs apply to consumer transactions and the way the selling company behaves before, during and after the contract is made.

The problem for someone who does not get a promised cashback is who can be held liable?

The money is coming from Lexmark but Mr Hadley bought the printer from PC World. Failing to honour this agreement would make both companies complicit.

Lexmark would certainly be considered culpable but PC World could be in the wrong for advertising the offer.

This may give rise to claims against it for breach of contract or misrepresentation if customers can prove they bought the goods because of the cashback offer. There is also the issue of whether a customer believed the cashback offer was being made by the retailer.

Whether Lexmark can make Mr Hadley wait up to 60 days for his cashback is also not clear. The Office of Fair Trading (OFT) told us there was no law on this. But if it was outlined in the Terms and Conditions the customer should have been made aware of the facts before the sale.

Furthermore, any terms considered unfair can be challenged under the Unfair Terms in Consumer Contracts Regulations 1994.

When we contacted Lexmark it told us that a cheque for £50 had been posted to Mr Hadley.

Who is responsible?

If a retailer and manufacturer jointly offer a cashback deal, both are likely to be liable under law. We have asked the OFT for more clarification on who is responsible when things go wrong.

However, consumers may have additional protection if they paid by credit card or through a finance deal.

In an earlier ruling the OFT said a customer may claim repayment of a cashback cheque from the finance company or bank under one of two conditions: if goods have been paid for by a finance agreement arranged through the retailer or the purchase is over £100 and has been paid for by credit card. This falls under Section 56 and/or Section 75 of the Consumer Credit Act 1974.