California Restaurant Coupons, Gift Certificates, and the Law

Reader Steve writes in with this question:

Is there a law in california that restaurant coupons do not expire?

Great question Steve. The answer is: NO, there is no such law regarding restaurant coupons not expiring.

HOWEVER, this belief could have been derived from these two scenarios:

1) Restaurant A always has a coupon for $5 off a pizza. In fact, anyone would be lame to NOT have one of these, they issue so many. If you look closely those will have expiration dates on them. However, chances are that if you bring in one that’s already expired, the staff member may just assume you could grab another one (with a later expiration date), since there are piles of them one the counter anyway.

2) There is a California law that says that gift certificates do not expire (with a few exceptions).

As the authorities at Nolo Press state:

People who live in California are in luck. It’s against California law to put time limits on gift certificates (with a few exceptions, including gift certificates for food, from nonprofit fundraisers, and from awards programs).

Oops, Steve, the exception includes gift certificates for food. So even if you had a gift certificate for a dinner for two at PF Chang’s, that expiration date WILL hold.

What you could try to do is ask for cash back instead of using the gift certificate…it would be smart of the food operation to do that, to preserve public relations. But, I think the whole reason businesses issue gift certificates and rebate offers is in the hopes that a large percentage of consumers will never collect on it. Free money for them, right? Tsk tsk.

And don’t cave in if the business tries to charge you a fee to process your expired gift certificate, which basically decreases the stated value of it. These fees are being challenged in the courts and if you show that you’re aware of this, they may back off.

California Civil Code Section 1749.5, TITLE 1.4A. GIFT CERTIFICATES, states:

1749.5. (a) On or after January 1, 1997, it is unlawful for any
person or entity to sell a gift certificate to a purchaser containing
an expiration date. Any gift certificate sold after that date shall
be redeemable in cash for its cash value, or subject to replacement
with a new gift certificate at no cost to the purchaser or holder.
(b) A gift certificate sold without an expiration date is valid
until redeemed or replaced.
(c) This section shall not apply to any of the following gift
certificates issued on or after January 1, 1998, provided the
expiration date appears in capital letters in at least 10-point font
on the front of the gift certificate:
(1) Gift certificates that are distributed by the issuer to a
consumer pursuant to an awards, loyalty, or promotional program
without any money or other thing of value being given in exchange for
the gift certificate by the consumer.
(2) Gift certificates that are sold below face value at a volume
discount to employers or to nonprofit and charitable organizations
for fundraising purposes if the expiration date on those gift
certificates is not more than 30 days after the date of sale.
(3) Gift certificates that are issued for a food product.

Of course, big disclaimer here that no Grubbers here are legal experts and all that, and if you take any advice here it’s at your own risk blah blah.

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17 Responses to California Restaurant Coupons, Gift Certificates, and the Law

  1. Jeff says:

    California seems to be very pro consumer, I hate all fees associated with gift cards, they just don’t seem fair.

  2. grubgirl says:

    True that, Jeff. Fees are the uninformed consumers bane… If everyone took just a little time out of their day to read the fine print we’d save a nice amount of cash.

  3. Jeff says:

    I’ve been on taken by fee’s a few times, but I am much better at finding the scams than I used to be.

  4. Jim says:

    Restaurant gift certificates are not covered by the food exception because that is only for perishible food. Restaurants serve prepared food.

    Check here: See endnote 12.

  5. sssassybbw says:

    Do you know if there is a law in California that grocery coupons even though they have an experiation date is expired or actually never expires?

  6. grubgirl says:

    SSSassybbw – We’re not law experts here but Googling your question came up with this information over at Yahoo! Answers. Quick summary – no, there doesn’t seem to be a California law that allows expired coupons to be honored:

  7. George Solish says:

    Coupon Expiration dates for groceries,stationery,etc.

  8. George Solish says:

    What are laws regarding Coupon expiration dates for groceries, stationery, etc.?

  9. George Solish says:

    What is the law regarding expiration dates on coupons for groceries, stationery, etc.?

  10. grubgirl says:

    We’re no experts on law but in a previous comment, we learned that there could be an urban legend about honoring expired coupons. The law (in California, at least) allows honoring of gift cards or gift certificates, which is different than a coupon.

    See the link to the original question on Yahoo! Answers:

  11. leendadll says:

    any idea if Tippr/Groupon offers are legally considered gift cards?

    either way, I purchased on in Nov 201 with a Sept 2011 expiration date. Today, 5 month after the fact the seller sent an email that the offer is actually expiring in 5 weeks, March, and was an error on the Tippr site.

    Am I mistaken in thinking that, besides being illegal to change the terms, the seller has to refund my cash if I ask for it?

  12. RNP says:

    I believe that since we are in CA (assuming you are too) that Groupon is the one to contact. Note the Universal Fine Print: “not valid for cash back (unless required by law). It says if you have gone to th4e merchant and they refuse to honor the coupon either before its expired or after (if required by law) then Groupon will refund you. Im not sure about Tippr but I imagine its similar considering Groupon would not likely do this unless state law so requires. It is only good for the amoubt paid however. Good Luck!

  13. RNP says:

    There is a subsection (3) explanatory note that reveals the above commenter was correct and persihsable food does not include a meal at a restaurant. (As of the 2008 amendment which was after this article was published).

    15California Civil Code Section 1749.5(d)(3); 83 Ops. Cal. Atty. Gen. 243 (2000). The Attorney General’s Opinion concluded that a gift certificate for a meal sold by a restaurant may not contain an expiration date. In our opinion, the 2008 amendment to this section clarified and affirmed the Attorney General’s position by limiting the exemption to “perishable food products,” not just “food.”

  14. Mike S. says:

    I have some Starbucks Gift Certificates ($10.00) & several $3.00 Beverage Certificates. I got these years ago, put them in a drawer and forgot them. It clearly states on the back of all these, “This certificate expires December 31, 2001 except in CA, HI, MA, NH, RI or anywhere else where prohibted by law. I live in CA. Question: do these statements really mean there is no expiration date and they are still good even though it is now 2011?

  15. Grubgirl says:

    @MikeS – yes. In CA you have the right to re-coup the original value of what was paid for those gift certificates. So, someone paid $10 for it, and you have that value still available for use. Note – the cash register employee may not be informed of this (reminds me of the story of a cashier thinking a $2 bill was a fake because he didn’t know they existed). Good luck!!

  16. Alicia says:

    What about” Groupons” do they expire? At least the money I put into them?

  17. Mike Friedberg says:

    I have a gift certificate for a car detail service purchased less than a year ago (last Christmas) at a local car wash. Upon attempting to redeem it, I was told that the price for the service has since gone up, and that I needed to pay the difference. Do I not get the service at the price pre-paid at the time of purchase (<1 year ago)? Thank you.

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