Is my deposit refundable?

[scsuit]

Please help me. I am being sued in small claims court in CA. I agreed to buy a used car from a private party for $4000. I wrote a check for $600 for a deposit with the vehicle ID on it. After thinking it over, and asking the seller (via phone) for more information (maintenance records, which were not available) I felt it was a bad deal.

On the night that we were to meet, 4 calendar days later, I called the seller and informed her that I had changed my mind and stated the reasons:
1. Absolutely no records of maintenance (primary concern, she had owned the car for 3 years)
2. Damage to front headlight
3. Condition of tires

After informing her of my decision, I stopped payment on the check. There was no discussion between the two of us that the deposit was either refundable or non-refundable. A few days later, I was notified by my bank of the attempt to deposit the check. Later she called and asked why I had stopped payment¡Kmy response was because I was not buying the car. We had not written anything about this transaction except my check. We did shake on the deal the night I wrote the check.

Please consider these factors too:
* She did not have title to the car. It was registered to her aunt in a different part of the state. In fact there was no current registration on/with the car. Her aunt was to send the title and registration.
* When trying to arrange a date to meet, she said she wanted to meet soon to make sure the car was sold (recognizing that the deal was not 'done' until we met again).
* She claims to have turned away other potential buyers while I waited for her to get title.

I am obviously looking for a way out of this, with out paying her a dime.
* Is a deposit with a verbal agreement assumed to be non-refundable?
* Is she able to enter into a contract to sell an item that she does not have title to?
* Any other ideas?

She is suing for the $600 and $300 to cover other related and unrelated costs (cost of a credit report to buy a new car).

Thanks ¡V


[This message has been edited by scsuit (edited October 16, 2000).]

 

[Tracey]

You have 2 arguments
1. There was no contract to buy the car. The $600 was an option to buy, not a contract to buy. It was dependent on her acquiring title & providing other information to your satisfaction. You weren't satisfied, so you did not enter into a contract.

2. A verbal contract for the sale of goods is unenforceable if it's for an amount over $500. This is called the statute of frauds. Unless the memo line on the check is sufficient to constitute a 'writing', the agreement was only oral. Ex: 1995 Hyundai, $600 down, $4000 total, due by 10/16/00. You have to identify the item sold & the price.

3. She can't use the doctrine of promissory estoppel, since an oral agreement, assuming it was made, was unenforceable under the statute of frauds. She could not reasonably rely on the agreement.

4. She was selling the car as her aunt's agent. That was legal.

5. There should be no related & unrelated costs. You told her you were not exercising your option & were stopping payment on the check. She knew it wouldn't clear, so any overdraft fees are hers.

What's up with the credit report? Isn't this an expense she would have had no matter whom she sold the car to? If so, it's not a damage you have to pay for.

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This is not legal advice and you are not my client. Double check everything with your own attorney and your state's laws. [email protected] - please include some facts so I know who you are!

 

[scsuit]

Thank you for your help. I agree that the costs of the credit report, etc. are in no way my issue.

Does Small Claims Court recognize and refer to the Statute of Frauds? or is it less formal (like Mills Lane - trying to do what he thinks is fair)?
I there a way that I can get a copy of the Statute of Frauds to refer to and highlight?

Thanks again!!!!