Article by Mark Harper “Can I have my deposit back please?” (published in Lexis Corporate Rescue & Insolvency (2014) 6 CRI 225) considers the issues relevant to the Law Commission’s project: “Protecting consumer prepayments on retailer insolvency”
On 23 July 2014, the Law Commission launched its 12th Programme of Law Reform. One project selected for inclusion in the programme is “Protecting consumer prepayments on retailer insolvency — a scoping review to assess the scale of the problem and consider ways to increase protection for consumers” (the project).
“Protection” can be provided in a number of ways, namely:
1. the setting of standards of conduct for directors as to the circumstances in which it is permissible to place consumer pre-payments at risk of insolvency;
2. methods of effective redress (both in terms of recovery of losses and sanction of conduct) against those directors who fail to comply with such standards;
3. the mechanisms that can be put in place within the insolvency regimes to provide recompense for the consumer in the event that the company to whom a pre-payment was made, becomes insolvent.
The primary focus of this article is, with reference to (1) and (2) above, the law as it presently stands and the “missed opportunity” in the directors’ disqualification proceedings, which arose out of the demise of Uno Plc and World of Leather Plc (see Re Uno Plc  EWHC 933 (Ch);  BCC 725) to provide protection for consumer pre-payments.
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