hifi_killer
New member
how old is your buyer? if he is very young, and you feel like a damn nice guy, you can consider the refund..
When a buyer backs out of a deal, is the deposit refundable or not?
- Thread starter alec_fishy88
- Start date
junkiemanxl
Active member
deposit should be forfeited when the buyer backs out. but ultimately, its really up to you if you choose to or not. maybe out of good will, you can refund him. but by agreement, you have the right to keep the deposit cause he did not fulfill the agreement.
Sometimes it would be good to have it in written format and have both parties sign it. just draft a simple agreement and have both parties sign and each will keep a copy of the agreement so when unforeseen stuff happens. both ends will be protected in their best interest.
Sometimes it would be good to have it in written format and have both parties sign it. just draft a simple agreement and have both parties sign and each will keep a copy of the agreement so when unforeseen stuff happens. both ends will be protected in their best interest.
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And this young guy will think he can get away with his action, and he will do it again and again with other sellers.
fgl
Well-known member
I work in an industry where deposits are used on a daily basis.
The sole purpose of a deposit is to secure the product. If there is a cancellation then it should be forfeitted.
We (my company) has had cases whereby legal action was attempted including lawyer's letter of demand for the deposit amount back but they could not go beyond the stage as the law is such.
Of course this is with black / white etc. If it's verbal - prolly have to go to small claims tribunal- end up payment $$$ but judge will still rule in favour of the party who accepted the deposit.
Also price agreed upon cannot be lowered, it would be breach of agreement.
An interesting fact is a counter law suite you could try for loss of income earned from the sale to other potential buyers.
the fgl way is the best: cheap prices offered with little or non negociable rates for good quality products, first come (as in 1st dude to put $$$ in my hand) first served basis and no deposit / part payment etc .... both sides safe
The sole purpose of a deposit is to secure the product. If there is a cancellation then it should be forfeitted.
We (my company) has had cases whereby legal action was attempted including lawyer's letter of demand for the deposit amount back but they could not go beyond the stage as the law is such.
Of course this is with black / white etc. If it's verbal - prolly have to go to small claims tribunal- end up payment $$$ but judge will still rule in favour of the party who accepted the deposit.
Also price agreed upon cannot be lowered, it would be breach of agreement.
An interesting fact is a counter law suite you could try for loss of income earned from the sale to other potential buyers.
the fgl way is the best: cheap prices offered with little or non negociable rates for good quality products, first come (as in 1st dude to put $$$ in my hand) first served basis and no deposit / part payment etc .... both sides safe
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alec_fishy88
New member
swee ar fgl. Kahki nangs!
I feel a need to correct the misconception that the statement above you've made. In the law of contract, the idea of a deposit - while to serve the purpose of securing the product and showing intent, is by no means assumed to be non-refundable unless explicitly statement.
To begin with, in contract law, if the deposit is a term of the contract, it must be expressed or implied that the deposit is non-refundable for you to successfully claim forfeiture... Implication can be done via customary means but you must go to lengths to show that deposits in such online transactions are non-refundable; and it is on your onus to prove this.
Why then can deposits be forfeited in commercial transactions? That's really because in placing a deposit with a firm for a product, you actually sign an undertaking to purchase the product and agree that your deposit will be forfeited if you choose to back out of this deal. However, as much as FGL would like to claim that the law limits you as such, the Unfair Contract Terms Act (Cap 396) may actually strike out these terms if the Court feels that the terms are patently unfair to the consumer.
You may choose to forfeit the deposit, but I would just like to point out that your legal liabilities still exist.
In any case, unless it has caused you great inconvenience, as a matter of being principled (and out of goodwill), i'd suggest you refund the deposit.
fgl
Well-known member
Valid points and yes, in my company's dealing we do have written agreements stating the non refundable policy of the deposit. Ours is more complex that involves materialization of certain numbers as well leading to non rfundable / non offset of initial deposit amounts if certain percentage criteria is not made .. its all legal.
Legal liabilities of the seller in this case? If there is no written contract between the two parties isnt everything just "here say"?
As a matter of goodwill - I have even fully refunded ppl who bought items from me but were not happy with it (through no fault of my own) ... but thats just me...
As to "not forfeit deposit" ... this means that the seller would incur the oppurtunity cost of not be able to sell his item to a more bonafide buyer who wouldnt change his mind..... loss of income & inconvinience all round... plus it opens up a whole new can of worms for future "buy by deposit" type of customers...
so ppl - remember the fgl way: no deposits - 1st come 1st served 
Valid points and yes, in my company's dealing we do have written agreements stating the non refundable policy of the deposit. Ours is more complex that involves materialization of certain numbers as well leading to non rfundable / non offset of initial deposit amounts if certain percentage criteria is not made .. its all legal.
Legal liabilities of the seller in this case? If there is no written contract between the two parties isnt everything just "here say"?
As a matter of goodwill - I have even fully refunded ppl who bought items from me but were not happy with it (through no fault of my own) ... but thats just me...
As to "not forfeit deposit" ... this means that the seller would incur the oppurtunity cost of not be able to sell his item to a more bonafide buyer who wouldnt change his mind..... loss of income & inconvinience all round... plus it opens up a whole new can of worms for future "buy by deposit" type of customers...
so ppl - remember the fgl way: no deposits - 1st come 1st served
No idea what you're trying to say when you referred to legal liabilities of a seller, but contracts formed orally are recognised under common law. I suppose you meant hear-say as well, wrong use of word anyway.
Sure, if your company deals with written agreements it can be considered as legal. However, if you actually look at the UCTA, (specifically sections 5, 6 of the said act dealing with "guarantee" of consumer goods and that of hire-purchase) if the said clause is deemed to be unreasonable or places the consumer in an onerous position, the Courts will rule in favour of the consumer. This has to do with the unfair bargaining position that a consumer is in.
However, in day-to-day transactions, deposits unless expressedly or implied to be such is not automatically forfeitable.
Unfortunately, your response to the opportunity cost relating can be countered by simple reasoning that you as a seller, has to undertake a fair amount of business risk. That is part-and-parcel of doing business/partaking in daily transactions, and in equity, it might be inequitable for you to forfeit the deposit when you have lost nothing per se.
fgl
Well-known member
Lost is the "opportunity to sell the item to a serious buyer" who would have been more serious and interested in purchasing the product, but it seems that buyers are trying to push the envelope in every which way.
Like I said before, my company has had some legal entaglements over these kind of issues and we have not lost a case yet. Or rather, beyond the initial advocate's demand letter, upon reply from our advocates, the plaintiff would not persue the matter. Of course it's a seperate multi million dollar business we are talking about altogether so the implications may differ somewhat when comparen to these kind of transactions
anywayz .... thanx for your legal insight dude
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theliverevolution
New member
Why would he want to pay the deposit if he's not happy about the price?
If he wanted the price lowered, then he should have tried to lower the price first, then place the deposit.
By placing a deposit, you indicate that you agree to the conditions set between you and the seller and have no further complaints
If he wanted the price lowered, then he should have tried to lower the price first, then place the deposit.
By placing a deposit, you indicate that you agree to the conditions set between you and the seller and have no further complaints
fgl
Well-known member
good point dude - like I said ... buyers nowdays are pushing the envelope ...
seems that these days we must have a list of good sellers as well as buyers - especially in soft so we all can know who we are dealing with ...
theliverevolution
New member
Hmm. A list of sellers. still can be done easily. But buyers... Hmm. I can't imagine it at this point, I'm sorry.
Also, some people would have to be in charge of regulating the list and making sure that, before a seller/buyer's name is up, there has to be a good reason, with sufficient proof
Also, some people would have to be in charge of regulating the list and making sure that, before a seller/buyer's name is up, there has to be a good reason, with sufficient proof
fgl
Well-known member
list of buyers - yes difficult I know .... ppl can easily change nics too etc ...
