Will customers lose all tens of millions of dong spent on gym and spa cards if WeFit goes bankrupt?

Lawyer Tran Thanh Tung of Global Vietnam Lawyers (GV Lawyers) shared some opinions from the legal perspective by analyzing and answering as to whether customers can get a refund after buying fitness cards from Wefit. What specific benefits its customers can receive when WeFit goes bankrupt is presented in the article with the title ‘Will customers lose all tens of millions of dong spending on gym and spa cards if WeFit goes bankrupt?’ posted on cafe.vn on May 13, 2020.

After WeFit declares bankruptcy, many customers who spent tens of millions on gym and yoga cards contact this business but its phone line is either busy or unsatisfactory in answering.

WeFit (now renamed WeWow), a startup once acclaimed as Uber of the gym lover circle, has just declared bankruptcy. Many customers buying WeFit’s gym and spa cards are anxious to get their money back for the service, some of them have spent 10 million dong on it, some 20 million dong and some others get cards with an expiry date lasting until 2021.

Customers “tearfully cry” for money back from WeFit

After hearing about WeFit’s bankruptcy, many customers call its call center to ask for a refund. Many others have commented on its Fanpage.

One customer wrote: “I am a customer who bought WeFit service package for 8 months of use until October 2020. It’s a package with unlimited practicing sessions. But I received a notice asking for a switch to to the package with restrictions on practicing sessions. “That is not in alignment with the mutual agreement upon accepting a purchase order. At the moment, I can’t arrange my practicing schedule if I decide to keep unchanged as against the notice and my number of practicing days is subtracted from day to day.”

This customer added that he contacted customer service department and called the hotline but there was no answer. He also did not receive any adequate explanation from WeFit.

Another comment wrote: “Why don’t you reply after reading the message? Is it unlikely that the epidemic affect only you and spare us? Customers wondered themselves: ” With such declaration of bankruptcy, how is the service package for beauty care or gym handled?”

In order to answer the question of whether the customer will receive a refund after buying any practicing card at WeFit, café.vn has sought consultation from a lawyer for more information.

The lawyer contends that Customers who buy WeFit services have priority for the last payment

Lawyer Tran Thanh Tung, Partner of GV Lawyers, shared the information on customer rights when WeFit goes bankrupt.

From Lawyer Tung and according to press information, on May 11, 2020, WeFit (WeWow) filed an application for opening bankruptcy proceedings.

Pursuant to Article 54 of the Bankruptcy Law, upon decision on declaring bankruptcy, WeFit assets will be used in paying in the following order of priority:

 

1. Bankruptcy expenses;

 

2. Salary arrears, severance allowances, social insurance, health insurance and other benefits for employees;

 

3. Incurred debts for the purpose of restoring WeFit operations (if possible);

 

4. Financial obligations to the State; debts payable to unsecured creditors and outstanding debts of secured creditors when the value of securities is insufficient for debt payment.

 

In this bankruptcy case, customers who have paid money to buy any gym cards are considered WeFit’s unsecured creditors. According to the said provisions, customers have priority for the last payment. Therefore, the opportunity for them to claim money back is not high due to the priority of payment to other creditors (secured creditors, employees, etc), and it is not sure that WeFit assets after selling will be enough to pay for those creditors.

Lawyer Tung added that the purchase of WeFit gym cards is a bilateral contract, in which WeFit collects money and has the basic obligation to provide services to customers. When unable to provide services under a contract, it is deemed to be in breach of a fundamental obligation, and the customer has the right to terminate the agreement, request a refund of the paid amount and claim damages. Therefore, refunding money received from customers is the best legal solution. However, this possibility depends on the financial situation of WeFit, and it seems impossible while its working capital is exhausted.

Upon filing a petition for opening bankruptcy proceedings, WeFit will have to prepare and submit to the Court, a complete list of customers as unsecured creditors. On that basis, the Court will notify customers of such petition for bankruptcy. Customers may participate in the Creditors’ Conference convened by the Judge and receive back the property corresponding to the residual value of WeFit assets after it is declared as bankrupt by the Court.

By The Tran, ICTVietNam

The post Will customers lose all tens of millions of dong spent on gym and spa cards if WeFit goes bankrupt? appeared first on Global Vietnam Lawyers.

source https://gvlawyers.com.vn/will-customers-lose-all-tens-of-millions-of-dong-spent-on-gym-and-spa-cards-if-wefit-goes-bankrupt/