March 05, 2024

Does a business have to refund your money if an item is lost in transit?

Dear Consumer Ed:

I ordered an item from an online company in Georgia, but the item was never delivered because it was apparently either lost or stolen in transit. Is the company legally required to replace or refund the item? Does it matter if the company has a "store policy" that indicates that the buyer must purchase shipping insurance for this to be covered, or does Georgia law protect buyers without the need for purchasing separate shipping insurance?

Consumer Ed says:   

Georgia, like many other states, has adopted the Uniform Commercial Code, which governs the buying and selling of most commercial goods. Under Georgia’s adoption of this law (O.C.G.A. §§ 11-2-504 and 11-2-509), the buyer and seller are free to make their own agreements that will determine who is legally responsible for what during shipping. Such an agreement may state that the business is  no longer responsible for the item once the business ships it. A business may still voluntarily choose to refund or replace an item despite claiming it has no liability after the item is shipped, but this is up to each individual business and its customer service practices.

Generally speaking, a business may set its own rules regarding liability around shipping. If an item you are purchasing is particularly expensive, unique, or otherwise valuable to you as the buyer–and the business policy has stated the business is not liable for the item after it has shipped–you may wish to purchase extra shipping insurance.

Here are some additional tips to consider when shopping online:

  • Consider your experience with the company or its general reputation before you order. If you've never heard of the seller, check its reputation with the Better Business Bureau.
  • Before placing your order, ask about the company's refund and return policies, the product's availability and the total cost of your order.
  • Get a shipment date and ask if the company will provide you with the tracking information.

Submit your own question to Consumer Ed.  Remember…we do not give legal advice. Always consult a lawyer about legal issues.

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