Can I be Sued over an eBay Auction?

One of the great features of the Weblog is, you can see search terms that people use, to find your blog. While this is not a blog about online auctions, and since there are plenty of those all over the web, I don’t plan on this becoming another one of those. However, this seemed to be a fitting subject, regardless of the type of auction.

Of course, the short answer to the question is YES. Why, of course you can. Especially in today’s litigious society, where people sue anyone for anything at the drop of the hat, or should I say, hot coffee spilled in your lap, as one seeks to blame the restaurant for serving coffee that’s “too hot” and causing light scalding on their leg when the clumsy individual caused the injury to themselves. Why do people always seek to blame others for their own faults? Money and greed are usually the culprits that answer that question.

However, if someone does cause real problems and losses to someone else and the individual at fault refuses to provide relief to the damaged party, then that was the intention of providing legal recourse for addressing the situation. I don’t think it was ever meant to be used by crooks to sue the victims for hurting them when catching the crook in the commission of a crime or other silly actions that should never waste our taxpayer’s dollars to misuse our legal system.

So, I have to wonder, what did this person do to have someone consider bringing a lawsuit against them? We continually hear of the seller’s that scam buyers and buyers that scam the sellers. There are also those that think they can run an eBay style auction and claim “as-is, where-is” and be absolved of all legal responsibility for what they represented. While Live Auctioneers also use those terms, at least the buyer can see what they are buying and determine their own suitability. But that may not even be a viable defense if the auctioneer made a specific claim about an item.

I had a friend that bought a motorcycle on eBay from a seller in a different state (well over 1000 miles away). When he received a box of junk parts, he contacted the seller and the battle was started, as the seller claimed it was all there in the box. Well, this certainly wasn’t what was envisioned from the description and the seller wanted to make things difficult, so my friend found a lawyer in the seller’s home state and filed suit. Now, that’s the bad part, as you normally have to file suit in the other person’s jurisdiction, at least in most cases (there are exceptions, like when it’s spelled out in a specific contract, for one). Of course, now the seller wants to try to negotiate and refund his money. Well, this is likely to cost the seller a whole lot more than he was going to make on the scam, as my friend is going to pursue him in court, even though it means he will have to take off work and travel over 1000 miles when it’s scheduled for a court date. I’m sure he’ll be seeking reimbursement for those costs, as well, not to mention his lawyer’s fees.

The best way to avoid a lawsuit is to be as honest as you can, with those you deal with. While it’s no guarantee that someone won’t find something as a perceived wrong and try to sue you, it should lessen your chances.

6 Responses to Can I be Sued over an eBay Auction?

  1. […] – bookmarked by 3 members originally found by kilryan on 2008-07-28 Can I be Sued over an eBay Auction? – bookmarked by 1 […]

  2. Anonymous says:

    Great Site

    By Ezra Levant on July 11, 2008 8:…

  3. antique auctioneer says:

    Great Site. I have enjoyed reading the information.
    I am a auctioneer in New York State. I have been calling auction as a independent contractor for a a few different auction houses for about 17 years. My questions is, can I be sued by a consignor/seller? The economy is very rough right now and and the market has changed, items are not bringing what they once did. I recently called a auction where I thought as well as many others, that the prices were very strong. I was confronted by the owner of the estate after the sale and they went on about how horrible it was, and their items brought nothing. The sale surpassed the auction house owners expectations. What can I auctioneer do to protect themselves.

    • Auction Law says:

      Wow… 17 years and this just came up? Of course, the simple answer to your question is a resounding “YES, you can be sued by a consignor/seller.” Keep in mind, your primary fiduciary duty is to the Seller. This means that you must consider their interests, first and foremost. Of course, this can sometimes be a matter of perception. While you felt you brought good money for their items, in their perception, the items apparently didn’t bring as much as they hoped… and so it is, with auctions.

      How do you protect yourself?
      FIRST! Insure that you have a very well composed Consignment/Seller Contract. It should clearly spell out everything that you could possibly think of and how it will be handled. Leave NOTHING to perception.

      The second thing you might want to consider is taking out an Errors & Omissions (E&O) Insurance policy. If a Seller takes you to court and wins, the Insurance company will pay the claim against you.

      And last, but not least, insure that you are operating “above board” in every facet. In other words, if you know that the right bidders aren’t present for that particular item, and it doesn’t bring anywhere near the normal expectation, then the item should be “passed” prior to calling sold (unless it’s advertised as an absolute auction). This is the reason that the law states “All auctions are considered to be with reserve, unless otherwise stated”. This clause gives the auctioneer the authority to insure that the sellers interests can be protected, in a poor market.

  4. johnny says:

    Thanks for good post

  5. Ebay UnderCover says:

    Really cool post, highly informative and professionally written..Good Job

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