If there was any confusion, the Minnesota Court of Appeals cleared it up today: The car wash receipt you get at the gas station is only good for 30 days.
It wasn’t for lack of trying by Don Wells, who bought a $7.99 car wash at the Holiday in Blaine in January 2012 and didn’t use it, even though it said on the receipt that the code expired in 30 days.
A month later he sued Holiday’s corporate entity on behalf of all carwash buyers, claiming that the 30-day expiration violates Minnesota law on “gift cards.” It’s illegal for gift cards to have an expiration date.
Is a car wash receipt a “gift card”?
No, the Minnesota Court of Appeals ruled today.
Here’s the definition of “gift certificate” under the law (emphasis mine:
[A] tangible record evidencing a promise, made for consideration, by the seller or issuer of the record that goods or services will be provided to the owner of the record to the value shown in the record and includes, but is not limited to, a gift card, stored-value card, store card, or a similar record or card that contains a microprocessor chip, magnetic stripe, or other means for the storage of information, and for which the value is decreased upon each use.
The decision hinged on an interpretation of the word, “value,” the court said.
In order to analyze the plain and ordinary meaning of “value” in the context of gift certificates, it is relevant for us to consider how value is used in the dictionary definition of “gift certificate.” Thus, it is helpful to know that the dictionary definition of that term interprets the value of a gift certificate in terms of monetary value.
But the court said the Legislature didn’t intend for a “gift certificate” to include a promise for a specific service.
If the legislature intended the definition of a gift certificate to include a tangible record promising that a certain good or service would be provided to the holder of the record, then it would not have been necessary for the legislature to include the phrase “to the value shown in the record.” The fact that the legislature did include that phrase in the definition indicates that it intended the definition of a gift certificate to be limited to records that promise that goods or services will be provided to the cash value shown in the record.
Court of Appeals Judge Michael Kirk said the fact Wells paid a sales tax on his car wash purchase proves Wells bought a specific service, not a gift certificate. “Holiday cannot determine whether to charge sales tax until the holder of the gift certificate actually purchases a good or service with the cash value that is stored on the gift certificate,” he said.
By the way, we also learned in today’s decision (pdf) why the car wash expires.
According to the director of support services at Holiday, Holiday’s car-wash codes expire after 30 days in order to prevent a practice called “jackpotting,” which is when an individual randomly punches numbers into the code box to try to obtain a free car wash.