Wards exchange rule jolts shoppers

Redeemable certificates given instead of money

January 03, 2001|By Stacey Hirsh | Stacey Hirsh,SUN STAFF

Mary and Francis Wallace are picking up lots of things at Montgomery Ward that they don't need - $425 worth.

That's how much the Parkville couple paid for a shed they bought there last month. But when they returned the shed, instead of getting their money back, the Wallaces were forced to take redeemable certificates in exchange. Now they're stuck buying $425 worth of stuff they neither need nor want.

"They said we lose it if we don't use it," Mary Wallace said as she left the Wards in Towson.

The Wallaces are steamed - and they're not the only ones. Several customers are upset about a new return policy that went into effect after Montgomery Ward announced Dec. 28 that it would be closing and it had filed for protection under Chapter 11 of the bankruptcy code in U.S. Bankruptcy Court in Delaware.

The return policy states that all sales on or after Dec. 29 are final. Anything bought before Dec. 29 can be returned for Wards merchandise certificates, but not for cash or credit, according to the policy.

So, shoppers coming in to return Christmas presents that don't fit quite right will have to exchange them for something else instead of walking out with the cash.

A spokesman for Wards said that's the policy approved by the federal court in Delaware. "The reason, of course, is we're in Chapter 11, and everything we do is subject to court approval," Wards spokesman Chuck Knittle said.

And such policies are not unusual for companies filing for bankruptcy, according to Zvi Guttman, a bankruptcy lawyer in Pikesville.

"It's pretty typical," Guttman said. "They [Wards] need to get rid of their stuff and be done."

In fact, it could be that consumers are getting an even better deal because at least they're getting store credit for their purchases. Wards could, Guttman said, make customers file a claim for their return. In that case, customers would have to wait until the bankruptcy case is over to see if there's any money left for their returns - and that could take years.

Chicago-based Montgomery Ward, which dropped the "Montgomery" from its store name last year as part of an image makeover, is going out of business after 128 years. It will close its 250 stores and 10 distribution centers, which employ 28,000 workers, over the next few months.

The announcement came 16 months after the chain emerged from a two-year bankruptcy, during which it closed more than 100 unprofitable stores and launched a plan to remodel half its stores for $180 million.

Wards, which has stores in 30 states, operates 13 stores in the Baltimore-Washington region, including stores in Towson, Annapolis, Laurel, Glen Burnie, Rosedale, Security Square, Bel Air, Hagerstown, Frederick and St. Charles.

At the store in Towson yesterday, Don Heil, a salesman in the appliances department, said he had seen customers who were upset because the store was closing but only a few were unhappy about the return policy.

However, several customers leaving the store said they were bothered by the return policy or had been online with someone having a problem with returns.

Janice Spurrier of Parkville bought a $10 sweater for her granddaughter Dec. 29 and tried to exchange it yesterday for a purse. But she had no such luck.

"This, I think, is unfair, but I'm not going to cause a scene for $10," Spurrier said. "So, I'm stuck with something she'll never wear."

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