The question arose concerning a ring which somebody purchased from a retail jeweler and soon discovered that it was defective. He returned to the jeweler, showed him the defect in the ring, and demanded a full refund. The jeweler looked at the ring and acknowledged the defect, but he claimed that this is the responsibility of the manufacturer. Since he – the jeweler – did not make the ring, he claimed, he bears no responsibility and the customer must therefore bring his claim to the manufacturer. Is the jeweler's argument correct, or must he return the money to the customer?

The Shulhan Aruch addresses this case in the Hoshen Mishpat section (232:18), and rules explicitly that a middle-man bears full responsibility for the merchandise he sells. He is therefore legally required to refund the customer's money if the merchandise is found to be defective. Of course, the retailer can then make a legal claim against the manufacturer; with respect to the customer, however, he bears full responsibility and must refund his money.

If after a transaction is made the seller notices that some of the money he received from the buyer is counterfeit, may he approach the customer and demand that he pay that sum again with legal tender?

The Taz (commentary to the Shulhan Aruch by Rabbi David Halevi, 1586-1667) addresses this question in Hoshen Mishpat (end of 75) and rules that if the seller claims definitively that the counterfeit money was received from a certain buyer, then that buyer must pay the given sum. Even if the buyer himself in unsure as to whether he had paid the tender in question, if the seller makes a definitive claim then the buyer bears responsibility and must pay with proper currency the amount of counterfeit money that the seller had received.

Summary: If a buyer demands a full refund for defective merchandise purchased from a retailer, the retailer must refund the money; he may then make a claim against the manufacturer from which he had purchased the goods. If a seller received counterfeit money and claims to know definitely from which consumer he had received it, the consumer must pay the sum in question with proper, legal tender.

See the book- "Pure Money" by Dayan Cohen, pages 158-159.