So far as I am aware in the situation you describe it here is no obligation for you to return the money. They have paid you money for a service, if they don’t need the service that does not automatically entitle them to a refund. If they have sent you money without any form of contract in place that could well constitute a free gift which you don’t have to return. It is also possible that by payment of monies they have legally accepted your contract as a “contract of adhesion” since these were the terms under which you offered to do business with them. Look into distance selling regulations, conditions of sale, adhesion contracts and refund law in your area.

However if you do not refund (even if legally entitled not to do so) you may lose more in the long run through word of mouth and loss of reputation. Generally at A Matter of Photography we would try to refund a customer where possible even if not obliged to as we value our professional reputation. Why not go back to the people you turned down and say that you are now available.