Fair Trading Act 1986

Consumer transactions and auctions - Layby sales

36I: Bankruptcy, receivership, liquidation, or voluntary administration of supplier: completion of layby sale agreement

You could also call this:

"What happens to your layby if the supplier goes bankrupt or closes down"

If you buy something on layby and the supplier goes bankrupt, you can still get the goods. You need to pay the rest of the money you owe and you will get the goods. You will own the goods and can take them home. If the supplier does not have enough goods for everyone, you will get the goods in the order you bought them. But if you did not make any payments for three months before the supplier went bankrupt, you cannot get the goods. If you pay money after the supplier goes bankrupt, you will get that money back. This does not apply if you get the goods as planned. You can find more information about what happens when a company is in voluntary administration under Part 15A of the Companies Act 1993.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM6156630.

This page was last updated on 10 December 2025 — View changes

Topics:

Money and consumer rights > Consumer protection

36H: Effect of cancellation of layby sale agreement, or

"What happens when you end a layby agreement"

36J: Bankruptcy, receivership, or liquidation of supplier: consumer priority, or

"What happens to your money if a supplier goes bankrupt"

Part 4AConsumer transactions and auctions
Layby sales

36IBankruptcy, receivership, liquidation, or voluntary administration of supplier: completion of layby sale agreement

This section applies if—
a supplier of goods under a layby sale agreement—
1. is adjudicated bankrupt; or
2. has a receiver or statutory manager or similar person appointed in respect of it or of all or any of its assets; or
3. is put into liquidation; or
4. is in voluntary administration under Part 15A of the Companies Act 1993; and
the goods to which the agreement relates are part of the assets in the bankruptcy, receivership, liquidation, or administration, as the case may be.

If this section applies, the consumer acquiring the goods is entitled, on payment of the balance (if any) of the price specified in the agreement and within a reasonable time, to—
complete the agreement; and
have property in the goods to which the agreement relates transferred to him or her; and
take possession of those goods.

However, if there are insufficient goods to enable all consumers to complete their agreements in accordance with subsection (2), the agreements must be completed in the same order as they were entered into.
Subsections (2) and (3) do not apply to a consumer who has, in breach of the agreement, made no payments to the supplier during the 3 months immediately before the relevant event described in subsection (1)(a).
If a consumer makes a payment under the agreement after an event described in subsection (1), the consumer is entitled to have that payment refunded in full.
To avoid doubt, subsection (5) does not apply if the agreement is completed in accordance with subsection (2) or (3).

Notes

Section 36I: inserted, on 17 June 2014, by section 23 of the Fair Trading Amendment Act 2013 (2013 No 143).