Recovering Damages From Non-Payer in High $$ Auction

[GregCA]

What is the name of your state? CA

What is the name of your state?What is the name of your state? CA

I make a living selling high value ($500-$5,000) items on eBay. As you would expect, non-paying bidders are frequent (about 5%) and continuing to increase. Although eBay will refund <I>part</I> of my expenses when a buyer doesn't pay, there definitely is a cost associated with non-paying bidders:

1) eBay refunds my final value fees (percentage of sale price), but not my listing fees. My listing fees which are lost each time usually amount to $25-$30 (because of upgraded "featured" status on listings)

2) In addition, the re-listed auction <B>always</B> sells for a lower price when re-listed. I think perhaps that the bidders who lost the first auction don't waste their time bidding the second time. This means <U>I usually lose a few hundred dollars</U> because of the lower sales price the second time.

Question: Since bidding on an auction is considered to be a binding contract, can I sue the original winner/non-payer for listing fees and the difference between the original auction price and the re-listed auction selling price? Would a small claims court consider my actions to mitigate the loss by re-listing reasonable and award me the difference in price from the first "sale" and the lower priced second sale as damages? Is there any similar case law on auctions that I can review?

It normally doesn't make sense to chase non-payers, but I have recently had a few who live closeby and I'm getting sick of the non-payers who cost me time and money. Filing in small claims court would be easy for these local bidders. Advice?

Thanks!

Greg

 

[manowar27]

It's Ebay for Christ Sakes........There was never any signatures given or taken. Although it is technically a "contract", I wouldn't lose any sleep over someone not paying. If your willing to spend good money on a lawsuit, go ahead. Mind you, you'd have to travel to the non payers state, and file in his district. Costs involved in travelling, cars, hotels and food ARE NOT able to recouped in your law suit. Chances are real good that you'd need to travel there at least 3 times. Even after winning a judgement against the non payer, the court can only decide that he does in fact owe you payment, they can not collect it for you. Even though you win the judgement, you could in fact come home empty handed.

 

[GregCA]

Please re-read the original post. I clearly stated that the latest batch of non-payers are local to me, which means that there is no travel involved. I also stated that I would be pursuing them in small claims court, which means that there would be very little cost involved in filing.

You trivialize the problem, but this is how I make my living and there is a growing problem with non-payers that cost me a lot of time and money. I'm not selling cheap trinkets. Sometimes the items reach $10,000-$15,000 in price, each and Ebay charges my account for thousands of dollars in final value fees which are only reimbursed several weeks later. I also lose hundred, if not thousands of dollars in lower final prices when I re-list. This isn't chicken feed.

Greg

 

[manowar27]

I understand........but like I said, winning a law suit only gives you the right to TRY to collect your money. The court washes its hands after deciding he does in fact owe you. Then comes the expenses of hiring a lawyer to place a lien on something of value that the other party owns. For example.......the court decides that your due $10,000 from Mr. X. Mr. X doesn't have $10,000. A lawyer of yours will put a lien on Mr.X's house. When Mr X decides to sell his house in 15 years, you might get your money from the sale price of the house.

OJ Simpson was sued for $33 million in civil court and lost. That was 10-12 years ago. The Goldman family has yet to see one red cent. See what I mean??

 

[pojo2]

manowar27 seems the rest of us were right on about you and your little ebay question you posed!

 

[Jypsy]

manowar27, you're sitting in a jail cell and we're the "idiots"? Go figure.

Greg, I was advised recently that after you win in small claims, you might be able to instruct a "motion of civil recovery" within the small claims division of the local courts. This could be done by each individual up to a certain value. The costs of each motion would be in the region ($50). When you go to the courthouse, ask about that.

I've also had problems with non-payers and you're aboslutely right, the fees are outragous and even if we get a fee value refund, it's only a small percentage. E-bay wins no matter what but we lose. E-bay should be helping a bit more, imo.

 

[GregCA]

Jypsy,

Thanks for your comments. I don't think manowar really gets "it". I'm not a total neophyte and I understand the difference between being awarded a judgement and collecting on a judgement. Its as much about principles as it is about the money. If a few sellers enforced binding auction results, perhaps bidding would be take more seriously. Most people who haven't been large sellers themselves don't understand the significant costs of non-paying bidders.

Example: I recently had one non-paying individual win a $15K item from me. Ebay instantly charged my account over $400 in fees and since my automatic monthly payment was due to them the next day, the $400+ was automatically removed from my bank account. It was almost 3 weeks until eBay credited the amount back to me. Even then, I didn't get the money back, but just a credit toward my next month's bill. In addition, when the item was re-listed, it sold for thousands less than the original auction because none of the original bidders was interested in bidding again. Either they had moved on to buy a similar item somewhere else, or they didn't want to invest their hopes again in the new auction after losing the first one. Whichever it was, I lost several thousand dollars because of the non-payer.

This happens to me (and every other seller) all the time. With the few deadbeats that live nearby, I'd just like to make them accountable for their indescretions that have cost me money.

Greg

 

[Jypsy]

I know, Greg and I think E-bay could take steps to reduce all this but as long as they're getting their cut, they don't care. They own Paypal now. You would think they'd create some kind of way for bidders to "pre-pay" into a sort of "limbo-account" or "pending" account before they bid to ensure things like this don't happen. Maybe sellers need to put more pressure on E-bay. Maybe they need to take their business elsewhere. I don't know. I'm sorry you had to go through all that and incur the losses.

I'll tell you, no wonder E-bay makes it so difficult to get a hold of them. I'd be ashamed to operate the way they do.

Edited to add: If you do end up taking these people to court and they start whining about the bidding not being a binding contract, ask them how they suppose an antique auctioneer in the real world would handle deadbeat bidders...I'm sure lots of judgements have been won on their behalf.