Amazon penalized for failure to refund B.C. customer it accused of ‘return abuse’

An Amazon Prime logo is seen on the side of a delivery van as it departs an Amazon Warehouse location in Dedham, Mass. on Oct. 1, 2020. (AP Photo/Steven Senne, File)

A B.C. regulator has ordered Amazon to pay nearly $20,000 in fees and penalties after concluding that the e-commerce giant had violated the provincial Business Practices and Consumer Protection Act.

Consumer Protection BC imposed the penalties in a decision issued last week and published online Wednesday.

The decision stems from a complaint filed in October 2024 by a consumer whose name is redacted in the document.

The complaint

According to the decision, the consumer ordered “goods that can be described as a portable dual display and portable digital storage unit,” from Amazon on Aug. 29, 2024. The cost of the order was $582.75, and the consumer paid the bulk of it – $511.27 – on a gift card. The remaining balance was paid via credit card.

That same day, Amazon provided the consumer with a delivery notification, saying that the goods had been delivered to the address provided and the package was “handed to (a) resident.”

The consumer started an online chat with Amazon customer service, informing the company that the package had not been received and asking for a refund, the decision indicates.

Rather than providing a refund, the company told the consumer to file a police report, which they did the next day, according to the decision.

On Oct. 25, 2024, the consumer filed their complaint with CPBC, and on Oct. 30, they sent a CPBC cancellation form called “Notice of Cancellation of a Distance Sales Contract for Failure to Deliver Goods/Services within 30 Days of Supply Date.” The decision indicates the notice requested a refund from Amazon within 15 days.

“The respondent replied to the consumer’s email and notice of cancellation in an email of their own, stating, ‘We are sorry that you feel the need to contact consumer court in relation to your account closure. We will not be able to comment further on this issue,’” the decision reads.

‘Return abuse’

CPBC investigated the complaint, soliciting information from Amazon to explain why it had opted not to provide a refund to the consumer.

The company argued that it had delivered the goods as requested, and provided evidence – though none of it was photographic – to show that the package was handed to a person at the address provided by the consumer.

Amazon also argued that its “conditions of use” pass the “risk of loss” onto the consumer as soon as a package is turned over from Amazon to its delivery carrier. The consumer agreed to these conditions when they made an account, according to the company.

Finally, Amazon said it declined to provide a refund to the consumer in this case because it was the fourth time in the last year that the consumer had sought to claim a refund because of an alleged non-delivery.

“The respondent had provided refunds totalling more than $300 in these previous instances, even though the respondent had evidence to show delivery to the correct address,” the CPBC decision reads.

“It was this pattern of claiming non-delivery of goods, along with the high value amount of the recent consumer claim, that led the respondent to conclude there was return abuse by the consumer.”

CPBC adjudicator Shahid Noorani acknowledges this last argument in the decision, but does not make any findings about whether the consumer was, indeed, engaged in “return abuse.”

Instead, Noorani’s decision focuses on the definitions of “delivery” and “delivery to a consumer,” and whether Amazon had proven it met its obligations under the contract.

Administrative penalty

Noorani concluded that “delivery to a consumer,” in the context of the Business Practices and Consumer Protection Act, means that the person who ordered the goods must receive them.

While arrangements could be made between a consumer and a seller to allow for delivery to a third party or for a package to be left on a porch, the decision notes, such arrangements must be explicit in the contract between the parties.

“In the case at hand, the agreed to conditions of use and guidelines and policies created by the respondent say nothing to the effect that delivery may take place by handing the goods to any person present at the address for delivery or simply leaving them at the address for delivery,” the decision reads.

“The absence of such a contractual agreement between the consumer and respondent means that delivery of the goods needed to be made directly to the consumer, as intended by the legislation.”

Noorani found that Amazon had not proven that it delivered the goods to the consumer, only that it had delivered them to the correct location.

The adjudicator also concluded the company could not rely on its conditions of use assigning the risk of loss to the consumer. The BPCPA’s protections of consumer rights cannot be expunged by a contract, and any “waiver or release” of such rights is “void unless the BPCPA expressly permits it,” according to the decision.

“The respondent’s reliance on its contractual allocation of risk cannot override the protections afforded to consumers under the BPCPA,” the decision reads. “The respondent’s terms and conditions are of no effect to the extent they purport to restrict or remove rights afforded to consumers under the BPCPA.”

Having found that Amazon violated the law, Noorani ordered the company to refund the consumer for the $511.27 portion of the purchase that was made by gift card, reasoning that the portion placed on a credit card had already been refunded by the credit card company through a chargeback.

The adjudicator also imposed a $10,000 administrative penalty on Amazon and ordered the company to reimburse CPBC $9,369 for its legal costs.

In a news release announcing the penalties Wednesday, CPBC noted that Amazon has 30 days to apply for a reconsideration of the decision.

“When you buy something online, you should know exactly how it will be delivered because it’s clearly outlined and you’ve agreed to it,” said Louise Hartland, the regulator’s director of public relations, in the release.

“It is not good enough for an online retailer to simply drop packages at the door or hand them to another person if the consumer has not agreed to this. This kind of delivery may be allowed, but only with the customer’s understanding and consent.”