question about the legality of ebay auctions....

October 30, 2005 9:00 AM

question about the legality of ebay auctions....

since ebay auctions are considered 'legal contracts' , is the following scenerio plausable? lets say i list an item for x amount of dollars, offering no shipping insurance. in the item description i state 'by bidding on this auction buyer agrees that seller is not responsible for lost items or errors made by USPS' now lets say the item gets lost in the mail, am i still obligated to refund the buyer, even though by bidding he agreed i would not be held liable for lost items in the mail?

posted by airnxtz to Law & Government (18 answers total)

Clearly if done on purpose it would be mail fraud. The government must prove your intent to defraud. That may or may not be difficult -- I think much of that would rest on your previous conversations with the buyer.

Also, I don't doubt that USPS keeps a log of packages sent so they can hunt down lost packages, so you'd probably be able to prove you sent it in the first place.

Lastly, you should have a receipt from the counter when you sent the package, assuming you sent it at a post office (it's difficult to send packages through mailboxes, but not impossible). That receipt would prove your good faith effort to deliver goods.

But, IANAL. The previous page has a bit more detail.

As far as being liable to refund, I doubt it, assuming it is VERY clear the buyer was buying 100% caveat emptor on the goods reaching him.
posted by shepd at 9:11 AM on October 30, 2005

If the buyer pays with PayPal, you'd better have a tracking number, regardless whether insurance was requested or not. If the buyer complains s/he didn't receive the auction item, the burden of proof that it was sent is yours.

Thus it depends on the mode of payment and its rules. For instance, if the buyer pays with a credit card, s/he may have recourse with the CC company if the item goes missing, requesting a chargeback.

If the buyer pays with cash or a check, s/he could still sue if the item doesn't arrive, but it'd be a lot more trouble to hire a lawyer and sue than complain to PayPal or request a CC chargeback.

For a good eBay resource on delivery problems click here.
posted by Blue Buddha at 9:23 AM on October 30, 2005

It sounds like you're asking whether the eBay "legal contract" between buyer and seller can be amended to include additional terms other than "Buyer will provided payment for the described items". My hunch would be that you cannot add additional terms, but I don't know how to find out the actual answer.
posted by smackfu at 9:43 AM on October 30, 2005

Yes. You are still obligated. Insofar as this question is answerable, the legal principle is, "The buyer didn't pay to have you ship the item. He paid to have it delivered."
posted by cribcage at 10:19 AM on October 30, 2005

Response by poster: true, cribcage , but the buyer knew the stipulations before bidding, and chose to bid anyway
posted by airnxtz at 10:32 AM on October 30, 2005

One may enter into a contract and agree to terms that are unconscionable and then not be bound by the unconscionable terms while the remainder of the contract remains binding.

You have to deliver the item or pay back when they've paid you. If it gets lost, you're the one who eats the loss, not the buyer. There is no way around this. Cribcage is correct, and even if you state explicitly that you are not responsible for lost items and the buyer agrees to said terms, you are still responsible for lost items.
posted by solid-one-love at 10:46 AM on October 30, 2005

Response by poster: whats the point of a contract if both parties do not agree to the terms?? no one was forced to bid!
posted by airnxtz at 10:51 AM on October 30, 2005

IANAL, but my feeling based on other areas of law is that if someone agrees to something that removes rights that they would otherwise have from a higher authority than you, that doesn't mean that the agreement they have is valid. So, if I sign a contract with you that says I agree to live in an apartment that you rent me, and I understand there is no heat, that won't overrule the landlord-tenant law that says you have to provide heat for me. It's like agreeing to work for sub-minimum wages, you can't do it legally, which is different, quite, from saying you can't do it at all. So, similarly I would assume that you can't contract away your responsbility to deliver an item that was paid for, no matter what someone signed. Could you get away with it? Knowing eBay, you might be able to. Is it legal? I doubt it. Is it ethical? No, it isn't.

I guess by "obligated", the question is who you are worried about doing what to you. The buyer would hassle you, likely, until the cows come home and leave shitty feedback. eBay might or might not try to make you do anything, or cancel your account. Other people might or might not buy things from you in the future.
posted by jessamyn at 10:51 AM on October 30, 2005

Wikipedia says this about contracts and their enforceability. See the actual article for lots of relevant hyperlinks. You're asking about legality, not ethics, and legally this resembles the "public policy" argument.

Void, voidable and unenforceable contracts

In general, there are three classifications of contracts that are not binding:
Void: If a contract is held to be void, the contract has never come into existence. For example, a contract is void if it is based on an illegal purpose or contrary to public policy; the classic example is a contract with a hit man or a minor. Such a contract will not be recognized by a court, and cannot be enforced by either party.
Voidable: A contract is voidable if one of the parties has the option to terminate the contract. Contracts with minors are examples of voidable contracts.
Unenforceable: If a contract is unenforceable, neither party may enforce the other's obligations. For example, in the United States, a contract is unenforceable if it violates the Statute of frauds. An example of the above is an oral contract for the sale of a motorcycle for US$5,000 (because in the USA any contract for the sale of goods over US$500 must be in writing to be enforceable).

posted by jessamyn at 11:02 AM on October 30, 2005

Uh, the shipping insurance protects you, dude. Don't try to wrap an elaborate legalism around your rationalizing spending less money on sending the package.
posted by dhartung at 11:46 AM on October 30, 2005

Response by poster: hey shepd,, when i send out an envelope at the USPS counter with no insurance, does the reciept include the recievers adress?
posted by airnxtz at 11:57 AM on October 30, 2005

For what it's worth, I don't get a receipt at the USPS unless I pay with a credit card, though my post office is small and YMMV. When I pay with a credit card, I think they include the receiver's zip code but not the receiver's address. Does this question have to do with your question from a few weeks ago?
posted by jessamyn at 12:24 PM on October 30, 2005

Legally you could write a contract that assigns the risk of things getting "lost in the mail" to the buyer. However then a rational buyer would pay you less for the item, due to the risk of never getting the item and not getting their money back if the items gets lost. It's in both parties' best interest for you to offer insurance, and you'll make more money too!
posted by falconred at 1:18 PM on October 30, 2005

whats the point of a contract if both parties do not agree to the terms?? no one was forced to bid!

Thing is, you cannot name a term such that you agree only to ship the item but not to deliver it. The term in the contract that you are not responsible is null but does not invalidate the remainder of the contract. The term does not exist. It never did. It's not that both parties didn't agree to the terms: the term that you wrote into the agreement is not actually a term in the agreement. He wasn't forced to bid -- but on the other hand, you also were not forced to sell.

That said, I am speaking as a non-lawyer and speaking from Canadian contract law. It is also not legal to mandate such a term under British law. I don't suspect that it would be any different in the US. I know that in New York, the seller is responsible for safe delivery. I don't know about California, but I don't see it being any different. And if you got paid via PayPal or by credit card, you are responsible for safe delivery -- or you'll get hit with a chargeback. And you might get your PayPal account cut off. And NARU'ed on EBay.

IMHO, anyone who doesn't use escrow on expensive items is a fool, but that's another story.

Your buyer will have to show evidence that he received a jug of water instead of a computer, but do you really want to risk being sued and having to pay double damages plus costs?

I have sold items on EBay that have never arrived. I simply refunded their money and ate the loss. Shrug. It happens.
posted by solid-one-love at 2:30 PM on October 30, 2005

Tacking on extra legalese with simple Ebay transactions is generally considered an Ebay Seller Warning Sign.

I'm not sure what end you're considering, airnxtz, but the methods that you're wondering about are not kosher.
posted by unixrat at 3:18 PM on October 30, 2005

Here's an off-hand lawyers' response, not necessarily suitable for your purposes.

Contracts for the sale of goods certainly can shift to the buyer the risk of loss during transit.

While, it's common to do so between merchants, it's quite rare to do so in consumer purchase contexts, and may be entirely precluded by credit card merchant regulations. (Check PayPal rules if you use PayPal).

Even if permitted, the rarity of that contract term makes it prudent to get more explicit evidence of agreement from the buyer than just his submitting a bid in response to an ad which included buyer's risk for shipping in the fine print.

In any event, when the buyer takes on the risk of transit the burden of proof of shipment has effectively shifted to the seller. Not easy to prove if you don't have a regular and reliable shipping system in place.
posted by MattD at 4:54 PM on October 30, 2005

airnxtz, I don't know about the USA, but in Canada it includes a tracking number which is directly linked to that information... So yes...

But that all depends on how you send the package. Again, if you're just going to stick a bunch of stamps on it and hope then it's different. But all the packages I've sent that are the size of a paperback book or larger end up with receipts like I've described because I send them from the post office instead of a mailbox.
posted by shepd at 10:16 AM on October 31, 2005

In case anyone stumbles across this thread, you ought to visit this one as well - our poster, airnxtz, turned out to be an eBay fraudster. Funny old world, eh?
posted by blag at 4:21 PM on November 16, 2005