Where do I sue an online buyer?

[SpawnedX]

What is the name of your state (only U.S. law)?

I sold a radio via an online forum I am on and conducted the transaction through PayPal. Upon the buyer receiving the radio, which I tested and confirmed was operational on the day I sent it, instead of him installing it, he tinkered around with it and "bench tested" it. Then he claims it will only beep. I never agreed to him doing any of this, the radio was already pre-wired for his vehicle type and he never tried to just install it and use it. If he had things would have been handled differently. I asked him why he didn't just try to install it first, and he started out with the excuse that he didn't trust my wiring, then when I pointed out that if my wiring was bad only the radio would be damaged not his car, so he should have tried it. From there his excuse changed to that my wiring wouldn't work (we have the same car).

Finally he opened a Paypal dispute, and even though I sent them screenshots of him admitting to improper use, they sided with him, stating that my screenshots could have been altered, they never asked the forum for any information on the messages, they just automatically decided I was the liar and took the money away from me and then had him send me back the radio. Now I have a broken radio, that was working when I sent it to him, and no money. The seal on the unit is broken, so I can tell it was opened.

I am going to sue Paypal for a negligent investigation and I want to sue the buyer as well. I simply need to know, do I do it in the small claims court in my state or his?

 

[SpawnedX]

Oh yes, this is not eBay. I live in Rhode Island and him in Maryland.

 

[davidmcbeth3]

You can sue in small claims locally ; if they want to object to the jurisdiction, let them. You'll still have time to file again.

 

[SpawnedX]

Thank you David. I have the forms for my local court filled out, I will drop them off Monday.

 

[davidmcbeth3]

Post back with results. If you dealt with paypal, dont they have a binding arbitration clause?

 

[SpawnedX]

State small claims courts have found that the arbitrary clause in the user agreement is not legal and that it undermines the rights of a citizen to make a legal claim against a company. Therefore it hasn't ever held up in court when they try to enforce it.

A 2005 ruling in New York’s Appellate Term 1st Dept court decision in Scarcella vs AOL 811 N.Y.S.2d 858 2005 and Strujan_vs_AOL 819 N.Y.S.2d 213 2006 (following the opinion of Scarcella), found that any forum selection clause is ‘unenforceable’ in NY. Many states have now followed this NY ruling and prohibits forum selection for most small claim court cases.

Here's why:

The court noted that forum selection clauses in consumer agreements are onerous because they render it unfeasible to pursue a small but legitimate consumer claim. Here, the plaintiff would have had to travel to Virginia and to retain counsel to pursue a claim that would likely amount to less than the expenses incurred in pursuing the claim. The defendant did not show that Virginia courts would also allow the plaintiff to pursue his claim with the same policy benefits the Small Claims Court offered. Thus, the judge invalidated the forum selection clause on the grounds that it conflicted with the public policy of the Small Claims Court.

The reasoning is that the New York Civil Court Act was created to allow small actions to be pursued without burdening the litigant. Paypal's forum selection clause is against the "public policy" established under the Civil Court Act, and thus, those cases held that the forum selection clause was unenforceable. More about the case can be found here and downloaded as evidence.

 

[davidmcbeth3]

State small claims courts have found that the arbitrary clause in the user agreement is not legal and that it undermines the rights of a citizen to make a legal claim against a company. Therefore it hasn't ever held up in court when they try to enforce it.

Thanks for the case cites .. I understand the reasoning .. I don't like binding arbitration clauses.. companies just try to screw us left and right & then wonder why we don't care about them. I went and looked at the AOL opinion & its short enough to post so, its below for other posters to ponder..

Orders, dated September 8, 2004 and March 28, 2005, affirmed, without costs.

Civil Court properly concluded that the forum selection clause set forth in the electronic America Online, Inc. (AOL) membership agreement, which required that any dispute against AOL be litigated in Virginia, was unenforceable in the limited context of this small claims case. Plaintiff made a sufficient showing that enforcement of the forum selection clause in the parties' "clipwrap" agreement would be unreasonable in that he would be deprived not only of his preferred choice to litigate this $5,000 controversy in the Small Claims Part, but, for all practical purposes, of his day in court (see British W. Indies Guar. Trust Co. v. Banque Internationale A Luxembourg, 172 AD2d 234 [1991]). This is particularly so in view of the costs and inconvenience attendant to litigating this claim in Virginia; the $2,000 monetary limit of the Virginia Small Claims Court (see Va Code Ann § 16.1-122.3), which would preclude plaintiff from seeking the full amount of his $5,000 claim; and perhaps most importantly, defendant's unqualified right to transfer the matter out of the Virginia Small Claims Court (see Va Code Ann § 16.1-122.4). Enforcement of the forum selection provision in these circumstances would frustrate the stated legislative goal of providing a "simple, informal and inexpensive procedure" for the disposition of small claims (see CCA 1802). Law Offs. of Cory J. Rosenbaum v. Gateway, Inc. (4 Misc 3d 128[A], 2004 NY Slip Op 50629 [2004]), relied upon by defendant, does not compel a contrary result since it involved the enforceability of a threshold agreement to arbitrate not shown to be onerous or unfair.