Dear Tripped Up,
In 2021, my wife, brother, and I signed up for a five-day Tremendous Tawas Lake Huron tour run by Pardson, the Ohio company that publishes Bird Watcher’s Digest magazine. We paid about $4,800 in total. The tour was canceled due to Covid that year, but we were eager to see the rare Kirtland’s warbler so we accepted credit. Shortly before the rescheduled trip left in May 2022, the company emailed to tell us that it was going out of business, and that someone would contact us about a refund. No one did, but through my own efforts I contacted Jack Harris, the receiver responsible for dismantling Pardson. He told me the only way to get my money back was through my credit card. But American Express said I was too late. Can you help? Paige, Atlanta
My inbox is full of messages from people who, like you, have not thought about whether the company they booked the trip with will remain solvent until the date of their departure.
Most of those complaints, however, concern missed flights and cruises, not the missed opportunity to see a yellow-breasted bird so rare that it breeds almost exclusively in the shade of young jack pine trees of Michigan and Wisconsin.
What this avian cutie has against the shade of more mature trees is beyond the scope of this column. But I can tell you the frustrating reason behind losing your money forever — even though many others, in similar situations, get their money back relatively easily.
We are talking, essentially, about bankruptcy. But I’m not using that term here because, technically, it only applies to cases filed in the federal court system — often using the infamous Chapter 7 and 11 statutes. Pardson, the company that has published the birding magazine since 1978 and operated its tours, filed in the Ohio state court system.
But for our purposes, federal and state processes are, like crows and crows, more alike than different. And in both systems, there is a fairly straightforward way for travelers to get their money back, and another – with longer odds – if the first method fails.
The easy way is through a credit card, although only under certain conditions. To begin with, the traveler must use a credit card — debit cards and other payment methods will not work. That’s because credit card issuers must comply with the Fair Credit Billing Act, which was signed into law by President Gerald R. Ford in 1974. Under one provision of this law, credit card issuers are required to refund cardholders who have been victims of billing errors.
Legal definitions of “misbilling” include the failure of a company to later deliver a product or service. How does a bankruptcy reform a legitimate purchase into a billing error? I don’t know, but I’m not complaining.
You did use a credit card, an Amex with a $500 annual fee. But it turns out the magazine gave you bad advice when they canceled the 2022 tour and told you to wait for someone to get in touch about a refund. If they instead recommend you contact your credit card company immediately, you’ll likely get your money back.
That’s true even though the Fair Credit Billing Act technically requires you to contact your card issuer within 60 days of the purchase. In an email, American Express spokeswoman Jessica Defilippo wrote: “Generally, the 60-day limit can be extended to give card members up to 120 days from the time of purchase, or in the case of pre-booked travel, from the date the travel is intended to take place.”
The last part is the key, because many people book the trip in advance. Spokespeople from Bank of America and Chase told me that their credit cards have similar policies.
That’s great for everyone except you. You mentioned Mr. Harris, the receiver with Pardson, advises you to try American Express and explain to them that you just found out about the company’s collapse.
That was almost 11 months after your travel date, however, and as you know, American Express denied your claim, probably because it was too long. (Ms. Defilippo wrote that “each case is evaluated uniquely,” but she could not comment on your specific case.)
That leaves you with a second and trickier path to a refund: to file a claim against the company’s liquidated assets, which Mr. Harris and subject to approval by the Court of Common Pleas of Washington County, Ohio.
Marvin Sicherman, a longtime bankruptcy attorney who also teaches law at Case Western Reserve University in Cleveland, sought to temper any expectations. His opinion, after I described your case:
“I like to say to people who lend money, ‘Close your eyes. What do you see? Nothing? Well, that’s what you get back.’”
Mr. declined to comment. Harris. I knew the court documents contained information, but I had trouble accessing them until I got a deft assist from Brenda Wolfe, Washington County clerk of courts since 1979. (She was the one who made my first cold call.)
Documents show that when Pardson failed, it had very few assets beyond a van and computer equipment. When I passed the documents to Mr. Sicherman, he said those assets are likely more than Mr.’s bills. Harris. Anything beyond that, he said, would go to employees or secured creditors, such as a bank that could repossess the property from a mortgage or car loan. For you, as an unsecured creditor, filing a claim is probably not worth the time.
Court documents revealed that Mr. Harris had gotten a judge to approve the sale of the magazine itself to a new owner. But that owner, who changed the name of the magazine BWDonly assumed responsibility for fulfilling about $200,000 in unfulfilled subscriptions to subscribers, not any responsibility for tours.
The new publisher has not responded to my emails either, but is a local NBC affiliate report from March 2022, it was noted that the new publisher had hired some of the old staff, and — disappointingly for you — that one of the reasons the magazine went under was “having to issue refunds on birding tours due to the pandemic.”
That leads us to a two-part lesson. Part I: When a trip is canceled and you’re given a choice between getting your money back or getting a credit, take the money. Part II: When you’re not given a choice, still beg for money, because if the company fails or never runs the tour, you’re out of luck.
Here’s a little piece of good news for everyone: the above situation usually applies when a company is dissolved, it will never be seen again. There is more hope for consumers when a corporation reorganizes through bankruptcy, as companies can strive not to alienate loyal customers.
And then there’s the lesson Jenn of Brooklyn, another Tripped Up reader, learned earlier this year. His family’s trip from New York to Sicily was interrupted when Flyr, a two-year-old Norwegian carrier, filed for bankruptcy in January, thwarting his wife and children’s plans to fly a major airline to Oslo and then take Flyr’s bargain Oslo-to-Palermo route. When Flyr went under, they were stuck with round-trip tickets to Oslo and no easy way to get from there to Italy. After writing to me, but still within 60 days of purchase, Jenn requested and received a refund from her Chase Sapphire Preferred card. But the cost and hassle of combining new, non-direct flights left him devastated the day he tried to save money on an untried airline.
When I suggested to Mr. Sicherman that travelers may avoid newer, untried companies, he told me it’s not that easy. “The average consumer has no way to determine the trustworthiness of any business entity they do business with,” he said.
But thanks to that Ford-era law, you can reduce your risk by using the best credit card you have.
If you need advice on a best-laid travel plan gone astray, send an email to TrippedUp@nytimes.com.