Q: My dance students paid money to enter competitions but the events were cancelled due to COVID. How can I get refunds?
Competitions are only giving credit, but some of our dancers are not returning to classes. Parents want a cash refund which involves thousands. Basically the competitions are holding our money forcing us to return to their competition.
By law do I have to give these refunds if I have not been given the money back? Parents are told at the beginning of the year that refunds are not given if a child drops classes.
The answer is it depends. For the Competitions, the contract the studio/club signed with the Competition legal entity will control that. If the contract says that if the event is canceled or postponed you only get credit, not your money back, that controls. If it is silent about refunds, then it could go either way, especially because the event was canceled through no fault of either side.
As for giving refunds to the parents, your contract will control. You could also offer to return funds next year as new dancers go to the next level and replace those who graduate, or make the credits transferable to other families who could buy them.
In the end, it will come down to the contract language of both contracts.
Hope this helps.
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