Adapted from a blog post from December 2007:
You see this every December: Well-meaning people walk into restaurants, approach the host's stand, and leave with gift certificates, which they'll hand out to friends and business associates. They'll smile at the gesture and say thank you. And then, if tradition holds, they'll likely stuff the gift certificate in a drawer and wait for a special occasion.
And then, months later, the recipients will read that the restaurant has closed.
They'll contact me and ask what to do with the gift certificate. To which the answer, in 99 percent of the cases, is along the lines of: "Apply glue to the back and use it to cover a crack in your wall. You're stuck."
We all love independent restaurants. They're the backbone of our economy and help define a city with their uniqueness. They're also volatile businesses. Owner retires. Owner burns out. Owner skips town.
Ethical restaurateurs, who know that their restaurant is in its final days, will not sell gift certificates.
Any given restaurant -- ethically run or not -- will have "paper" out on the street. State laws say that gift certificates never expire and that holders of certificates are truly creditors of the corporations that issue them. But hah. Try to collect on that. Striped Bass, at the time of its bankruptcy under Neil Stein, had more than $50,000 on the books. Toward the end of his run, Stein declined to honor certificates because he said he had donated many to charities and not been directly paid for them.
My recommendations: If you feel that you have to buy a restaurant gift certificate, swallow pride and go to a chain, or at least to an operator with multiple locations, e.g. Marathon Grill, Iron Hill, Kildare's, Starr, Garces, Vetri. Include a note insisting that the recipient use it right away. Don't "wait for a special occasion." A free meal is a special occasion!
(Then again, even a chain can let you down -- as anyone with a Spaghetti Warehouse gift card will find out.)