Wholesaler Refused a Refund on Faulty Stock? Your B2B Legal Options

You ordered a pallet — or a container — of stock from a wholesaler. When it arrived, a material portion was faulty, off-spec, damaged, or simply unfit for resale. You raised it. The wholesaler stalled, blamed the freight company, demanded photos you already sent, then went quiet. Your cash is tied up in inventory you cannot move.

B2B sales sit outside the consumer protections of the Australian Consumer Law in most cases, but you are far from defenceless. Each state’s Sale of Goods Act, the contract itself, and the common law of contract all give a buyer real remedies when goods do not match description, sample, or fitness for purpose.

The legal context

Under the Sale of Goods Act in your jurisdiction (for example the Sale of Goods Act 1923 (New South Wales) or Goods Act 1958 (Victoria)), goods sold by description must correspond with the description. Where the buyer makes the purpose known to the seller, there is an implied condition that the goods are reasonably fit for that purpose. Where goods are bought by sample, the bulk must match the sample. Breach of any of these is a contractual breach that entitles you to reject the goods, claim damages, or both.

Common pushbacks and why they fail

• “All sales final.” A blanket clause cannot exclude statutory implied terms unless very specific drafting is used, and even then it rarely defeats a fitness-for-purpose claim.
• “You should have inspected on delivery.” Latent defects only discoverable on use are still actionable; reasonable inspection is the test, not microscopic.
• “Take it up with the manufacturer.” Your contract is with the seller. The seller’s recourse against the manufacturer is the seller’s problem, not yours.
• “Credit note only.” If the breach is material you can elect a refund, not a forced credit you may never use.

The document and what it does

A Letter of Demand puts the wholesaler on formal notice. It identifies the order, the defects, the statutory and contractual provisions breached, the remedy elected (refund, replacement, or damages for resale loss) and a deadline — typically 14 days. It signals that the next step is small claims tribunal, the Magistrates Court, or the relevant state court depending on quantum, and that legal costs may follow.

What Claim Done delivers

• Order, invoice, delivery and defect particulars laid out cleanly
• Citation of the relevant Sale of Goods Act provisions for your state
• The specific contractual terms breached (if you have a supply agreement, we reference it)
• Quantified loss including resale margin, freight, storage and disposal costs
• Clear deadline and escalation path
• Drafted and sent as a PDF for a flat $49

What to expect after

Wholesalers that have ignored emails for weeks routinely settle within seven days of a formal Letter of Demand because the next stop is a tribunal or court filing on the public record. If they hold out, a Final Demand ($49) and a small claims or Magistrates Court application maintain the same paper trail and dramatically improve your settlement leverage.