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Consumer Beat

In some cases, the customer is not right

Consumers often criticize companies for poor service, poor workmanship, or just being sleazy. But despite conventional wisdom, the customer isn't always right. Sometimes the consumer is right, sometimes the company is right, and sometimes the answer falls somewhere in between. Here are a few tales from the frontlines:

Clothing depreciates, too

Corey Smith loved her Tahari pants.

"They were stretchy, but they fit well and I could wear them all year long," said the Somerville resident, who works as a concierge at the Boston Harbor Hotel.

Needless to say, she was devastated when her dry cleaner in Harvard Square lost the pants earlier this year. Her shock turned to anger when the dry cleaner offered her compensation of just $45. Smith says she paid $300 for the pants two years ago.

"You can't buy a pair of nice pants at Target for $45," Smith said.

Smith has a point, but most dry cleaners value clothes differently than the people who wear them. If an item is lost or damaged during cleaning, many dry cleaners either offer customers some multiple of the cleaning cost or the depreciated value of the garment.

Smith said her dry cleaner, Arrow Cleaning and Tailoring, offered her 10 times what it charged for cleaning it, or $45. She said the company printed its policy on the back of the receipt, but she hadn't noticed it.

Officials at the dry cleaner did not return phone calls.

But Smith's experience may not be uncommon. Jon Meijer, director of membership at the Drycleaning & Laundry Institute in Laurel, Md., said there is no standard policy on lost or damaged items in the dry cleaning industry. But he said more and more dry cleaners are reimbursing customers for the cost of their lost or damaged item, minus any depreciation.

The depreciated value is based on the fair claims guide put out by the institute. The guide indicates the average life expectancy of a pair of dress slacks is two years, which means Smith's pants had lost all their value.

"There is depreciation, just like there is with a car," Meijer said.

The Zoots chain, which was not involved in Smith's experience, offers the lesser of 15 times the cleaning cost of the lost item or its depreciated value.

Must you call to cancel?

Mary Scott Janney of West Barnstable recently received what she called a "sneaky and sleazy" mailing from American Express that offered her a free 2008 appointment book and pocket diary "as part of our extraordinary executive organizer plan."

It turns out, the appointment book and diary weren't entirely free. American Express was charging shipping costs of $2.97 for the appointment book and $1.97 for the diary, plus sales tax. The company also offered to send future editions at the regular price of $28 and $15, respectively.

"If you don't want the appointment book and/or pocket diary edition being offered, just return the cancellation card within 20 days or call American Express," the letter stated.

Janney interpreted that to mean she had to call American Express to opt out of the offer. I received a similar offer and I read it the same way. When I called American Express to tell them I wasn't interested, the customer service representative said I was right, that I needed to call in to avoid being sent the appointment book and pocket diary.

But Jill Davison of American Express Publishing said Janney and I were reading the letter incorrectly. She said customers wouldn't be sent the free books unless they called to order them. Davison said the sentence in the letter about canceling within 20 days was directed at people who had ordered the books and then decided they didn't want them anymore.

"How confusing is all of this for the consumer?" Janney asked.

Fridge seems to be cursed

Elizabeth Gould of Winchester wonders whether she's cursed.

More than a year ago, General Electric replaced Gould's six-year-old refrigerator at no cost after GE technicians couldn't figure out why her fruits and vegetables kept freezing.

Her new refrigerator arrived in June of last year but it had its own problems. The unit arrived with an icemaker that didn't work and chipped arms on a freezer drawer that needed to be replaced. Months later, a shelf inside the door gave way and, in April this year, the main shelf cracked.

In July, as Gould was preparing for a birthday party, she noticed the main shelf was cracked again. Then the temperature in the refrigerator and freezer starting rising, turning her ice cream to soup. She and her friends quickly shuttled everything in the refrigerator to the 20-year-old Kitchen Aid in her basement.

In the last month, Gould says two more shelf parts and a light shield in the freezer have cracked.

With the refrigerator under warranty, GE each time has made repairs or replaced shelves. But the warranty will expire in June and Gould is wondering whether the refrigerator is a keeper.

"I literally think about my refrigerator too much," she said.

She's also highly critical of GE. "No one's looking at the big picture," she says. "They only take care of problems one at a time. I don't think this thing has been designed to hold actual food."

GE spokeswoman Allison Eckelkamp said company records indicated all of the issues with Gould's refrigerator had been addressed, including a new shelf for her unit ordered last week. "If Ms. Gould has other matters she needs addressed, she should contact us directly so that we can try to resolve the situation to her satisfaction."

Extra credit for karma

The credit card solicitation from Chase Bank arrived with a plastic card proclaiming "pass the karma."

It was an invitation to sign up for a new credit card and join a club for Facebook members called Chase +1. Members earn karma points that can be redeemed for concert tickets, movies, and electronics.

The Chase +1 card has no annual fee, an annual percentage rate of 18.24 percent, and late payment fees ranging from $15 to $39, depending on the size of the balance. A late payment can also trigger a default annual percentage rate of as much as 32 percent.

Chris Lindstrom, higher education program director for the US Public Information Research Group, a consumer watchdog, says too many college students are blinded by the prospect of a free T-shirt or a concert ticket and don't pay attention to the consequences associated with a credit card.

"This is just another example of how the credit card industry will stop at nothing to get their credit cards into student wallets," she said.

Chase spokeswoman Jessica Hougentogler said all the terms of the credit card offer are spelled out clearly and the +1 program promotes financial literacy. Karma points are awarded to participants who take a credit education quiz and pay their bills on time.

"We are committed to providing credit card products that are designed specifically for college students, and want to help them build good financial habits and a credit history that prepares them for a lifetime of successful credit use," Hougentogler stated in an e-mail.

Hougentogler declined to say how Chase developed its mailing list for the Facebook offer. She said Facebook does not provide Chase with mailing lists or data about its members.

Bruce Mohl can be reached at mohl@globe.com.

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