Time crisis: Will customers get their goods?

The seriousness of the situation at Granville Technology – which owns Time Computers, Tiny and The Computer Shop retail chain —became clearer on Wednesday when the administrators were called in.

The estimated thousands of consumers who have paid for systems and are now waiting for delivery are growing increasingly worried.

One customer asked: "My son's laptop has just gone in for repair. Am I ever likely to see it again?" Those who have purchased maintenance agreements with Granville are concerned too.

While Granville remains in business, consumers can have some recompense with the company. This situation changes if the company goes out of business.

Those who have paid for goods by credit card have the most protection. "Any claim that could have been brought against Time or Tiny can be brought against the credit provider under Section 75 of the Consumer Credit Act 1974," said Joanne Barker, senior lawyer at Which? Legal Service.

Under the Sale of Goods Act, if the provider is unwilling or unable to deliver the goods — which could be the case with Granvile Technology — then the consumer can buy a similar product elsewhere and then look to the credit card company for the difference. This is also true for those who have made a part payment. As Barker explains, "if they had paid £500 deposit on a computer costing £3,000 which is not delivered, but have to buy a similar model at £3,500, they can look to the credit card company for the extra they have had to pay".

Those who have paid in cash are in a much more difficult position. If the company has gone into liquidation then a claim has to be made against the liquidators but, as unsecured creditors they will be the last to be paid and may not get paid anything.

Time and Tiny had a range of "cash back" schemes where, as an incentive to buy more equipment, consumers would be offered cash back for purchasing the whole lot. These schemes are very popular in the IT business and especially in the US. Should Granville cease trading, the question of whether or not the consumer can get the cash back will, according to Barker, "depend on whether the cash-back scheme was underwritten by an insurance company, in which case it should not be affected". If the scheme was run by Granville it is unlikely that they will be paid.

There is also bad news for those who had paid for long-term maintenance with Time/Tiny, if Granville collapses for good. "If they paid in cash then their claim will fail," said Barker. However, "if the purchase was made, even in part, on credit card or with a finance agreement then the customer can claim from the credit provider," said Barker. "If any computers were purchased on hire purchase agreements then the claim is against the hire purchase company as they own the computer."