Holiday Returns, Gift Exchanges, And The Consumer Fraud Act

Holiday Returns, Gift Exchanges, And The Consumer Fraud Act

Retailers face the same legal standards in December that apply in July. The Consumer Fraud Act does not relax because lines are long and staff is seasonal. In New Jersey, refund and exchange rights turn first on what the merchant told the customer before the sale. A policy printed only on the receipt is not enough. If a merchant limits refunds to exchanges or store credit, that limitation must be disclosed in a way the customer can see before paying. The Attorney General has reminded retailers that refund policies of twenty days or less must be posted where a buyer can see them, such as at the entrance, at the register, or on the item itself. Failure to disclose the policy before purchase is treated as an unlawful practice. 

Posting The Refund Policy And The Twenty-Day Consequence

New Jersey has a specific refund policy disclosure law. A retail merchant that restricts refunds must conspicuously post its policy before the sale. If the policy is not posted, the buyer has up to twenty days from purchase to choose a cash refund or a credit so long as the goods are unused and undamaged. Courts treat violations as Consumer Fraud Act issues, which opens the door to treble damages and fee shifting. Retailers who want an all sales final policy can have one, but it must be posted in advance in clear language.

The Refund Policy Disclosure Act does not apply to motor vehicles, perishables, custom goods, or other designated non‑returnable merchandise.

Exchanges, Restocking Fees, And Add-On Conditions

An exchange-only policy or a restocking charge is lawful when it is disclosed to the customer before payment. Undisclosed fees or conditions applied after the fact invite Consumer Fraud Act claims and enforcement actions under the Division of Consumer Affairs advertising rules. The State has used those rules to police add-on fees that were not disclosed at the point of sale. The same analysis applies to restocking or repackaging fees tied to holiday returns. If the fee matters to a reasonable consumer, disclose it plainly where the consumer decides to buy. 

Gift Receipts And Store Practices

New Jersey does not require a merchant to issue gift receipts, but once a store advertises or promises a particular exchange process, it must honor that promise as written. A policy that limits exchanges without a gift receipt is enforceable if disclosed before purchase. A policy that treats sale items differently is enforceable if disclosed before purchase. The legal risk arises when the limitation appears for the first time on the receipt or when staff apply a restriction that was never posted. The Consumer Fraud Act targets precisely that type of post purchase surprise.

Shipping, Delivery, And Holiday Backlogs

Holiday sales often depend on promised delivery dates. New Jersey’s delivery regulations require sellers to disclose delivery obligations and to offer a meaningful remedy when delivery is delayed beyond the promised date. Sellers must either deliver within the stated time, obtain the buyer’s consent to a new date, or provide a prompt refund. Printing general delays on the receipt will not cure a missed promise if the advertisement or order confirmation gave a specific arrival window.

Defective Merchandise And Warranties

Return policies do not wipe out statutory and contractual warranties. Goods must be fit for ordinary use and must match what was promised. If an item is defective, the remedy flows from warranty law and the Consumer Fraud Act, not from the store’s exchange preferences. A merchant cannot use an all sales final sign to avoid responsibility for a product that does not conform to the description or that fails immediately on ordinary use. The best practice is to treat defects under warranty and to keep exchange policies focused on buyer’s remorse, size issues, and duplicates.

“All sales final” language does not erase express warranties or the CFA, and in certain regulated sectors (e.g., furniture) such clauses are prohibited; a seller may limit or disclaim implied warranties only if the UCC’s strict requirements are satisfied and without negating express warranties.

Advertising Claims And Point-Of-Sale Accuracy

Holiday advertising creates enforceable obligations. Pricing must match what is displayed. Material terms of promotions and giveaways must be stated in a manner a reasonable consumer can see before purchase. If a promotion ties eligibility to dates, categories, or quantities, those limits must be stated with comparable prominence. When a store makes an error, quick corrective action and honoring the clearer statement reduces exposure under the advertising rules and the Consumer Fraud Act.

Practical Guidance For Retailers And Shoppers

Retailers should review signage now, confirm that refund and exchange policies are posted where customers decide to buy, and train staff to follow the written policy exactly. Restocking fees should appear on the same signs as the refund rules. Online checkout pages should display the policy before the customer clicks to pay, not only in post-purchase emails. Delivery promises should be realistic and tracked so customers are offered a timely refund or a new date when shipments slip. Shoppers should keep packaging until they confirm the item will be kept, read posted policies at the entrance and register, and expect merchants to honor posted terms.

Bottom Line

In New Jersey, holiday returns and exchanges are a disclosure problem, not a December exception. Post the policy before the sale. Apply it as written. Handle defective goods under warranty. Keep delivery promises or offer a prompt refund. Doing so aligns retail practice with the Consumer Fraud Act and avoids the post-holiday disputes that consume January. 

For more information about your legal rights or to schedule a consultation, please contact the Law Offices of Peter J. Lamont at www.pjlesq.com, call 201-904-2211, or email info@pjlesq.com.

Contact us today to discuss your business or legal matter. Put our 20+ years of legal experience to work for you.

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For detailed insights and legal assistance on topics discussed in this post, including litigation, contact the Law Offices of Peter J. Lamont at our Bergen County Office. We're here to answer your questions and provide legal advice. Contact us at (201) 904-2211 or email us at  info@pjlesq.com.

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About Peter J. Lamont, Esq.

Peter J. Lamont is a nationally recognized attorney with significant experience in business, contract, litigation, and real estate law. With over two decades of legal practice, he has represented a wide array of businesses, including large international corporations. Peter is known for his practical legal and business advice, prioritizing efficient and cost-effective solutions for his clients.

Peter has an Avvo 10.0 Rating and has been acknowledged as one of America's Most Honored Lawyers since 2011. 201 Magazine and Lawyers of Distinction have also recognized him for being one of the top business and litigation attorneys in New Jersey. His commitment to his clients and the legal community is further evidenced by his active role as a speaker, lecturer, and published author in various legal and business publications.

As the founder of the Law Offices of Peter J. Lamont, Peter brings his Wall Street experience and client-focused approach to New Jersey, offering personalized legal services that align with each client's unique needs and goals​.

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