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Legal obligation to sell?

Am I obligated to sell an item at mismarked price...

         

mhackl

1:23 am on May 25, 2007 (gmt 0)

10+ Year Member



I encountered a problem with a customer today. I recently built a new ecommerce website but when I uploaded the product database some columns were mis-aligned, merged, or something to that effect. This snafu caused some of the product prices to get screwed up. Long story short, A $200 item wound up being listed for $1. Well this customer saw this snafu and tried to place an order for it. I caught the error before the order was processed and called the customer to explain. He was irate over the phone because I wouldn't sell the item for $1. He claims that I am legally obligated to sell the item to him for that price.

I've heard of "Bait and switch" laws before, but am I really obligated to sell this item to him for a buck?

ridgway

5:34 am on May 30, 2007 (gmt 0)

10+ Year Member



my god, life is too short. tell the guy it was a typo and get on with life, don't answer his calls.

laugh at any bozo who threatens to sue over $199. they are 1) clueless, and 2) unpleasant people, neither of whom are deserving of your valuable time.

JesperFJ

1:52 pm on May 30, 2007 (gmt 0)

10+ Year Member



In Denmark there was a case with a youngster taking a photography of a TV in shop with a redicilous low price. Then entered the shop and claimed the TV at this price and showed the photo as evidense. It was ruled that the youngster was not in "Good faith" and therefore could not claim the good at the announced price. Your case is similar because he called and warned you about the mistake.
Otherwise a pricetag on a widget in shop is usually seen as a final offer that a buyer can accept. Adds in a newspaper not as much so because a typo could ruin the shop.

jsinger

2:06 pm on May 30, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



Otherwise a pricetag on a widget in shop is usually seen as a final offer that a buyer can accept. Adds in a newspaper not as much so because a typo could ruin the shop.

Errors occur on tags. Plus tags can easily be altered. The law (in the US) uses a FICTION that ad/tag prices are "invitations to make a bid."

Where it gets complicated:

1) Buyer wants 10,000 of a missmarked $10 item and is willing to sue

2) Small error, not utterly obvious, is on a wholesaler site and resaler relies on that price to sell huge quantities of that product. For example, a gov't bid.

simonuk

2:08 pm on May 30, 2007 (gmt 0)

10+ Year Member



What if the payment system you use is one like PayPal or Nochex where it is tied into the cart the money is taken instantly and, more importantly, *before* you've seen the order/mistake?

Demaestro

4:56 pm on May 30, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member Top Contributors Of The Month



What if the payment system you use is one like PayPal or Nochex where it is tied into the cart the money is taken instantly and, more importantly, *before* you've seen the order/mistake?

Then you are hooped. Once the funds are taking the deal is done and it is up to you to come up with the goods or services.

All my shop sites have 2 versions... one live... one not... all price changes are made to the one that is not live... we wrote a "dif" algo that goes through the live and non-live database and reports on products who's price don't match from one to another... if the difference is greater the 100% it flags it in the report and the report is looked at by a human before the changes are made live... trust me it is a layer of control I couldn't sleep without.

jwolthuis

6:16 pm on May 30, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



Once the funds are taking the deal is done and it is up to you to come up with the goods or services.

Not a done deal. Simply tell the customer that (a) you're out of stock, or (b) that the item is discontinued.

Refund his money, and move on.

Demaestro

6:27 pm on May 30, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member Top Contributors Of The Month



Not a done deal. Simply tell the customer that (a) you're out of stock, or (b) that the item is discontinued.

Refund his money, and move on.

So you want me to lie?

First all my sites have the real time stock listed and boast that fact so I wouldn't say that to someone.... And even if it was out of stock then they would expect a back ordered one.

If it is discontinued then you better take it off your website and stop selling it. Imagine seeing a product you will told was discontinued back on the same site that told you that and the only difference is the price is higher.

Like it was pointed out if you are talking about an order of 1 item then maybe they will let it go... if someone buys bulk for reselling or for making contract estimates and we are talking building supplies or something then they aren't just going to move on when you are messing up their business with your lack of professionalisms.

Also what if it isn't a physical good? What if it is digital... how can it be out of stock or discontinued?

All and all this response is shady at best.

[edited by: lorax at 8:01 pm (utc) on May 30, 2007]

Demaestro

6:32 pm on May 30, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member Top Contributors Of The Month



Looks like a purchase order can be used a a legal sales contract so if your site sends one of auto-magically then you are most likely bound to it. In the USA

In many cases a purchase order, pro forma invoice, or order acknowledgment may serve in place of a formal sales contract. A purchase order is issued by the buyer and sent to the seller, stating the type and amount of goods to be purchased, the price, and any other material terms such as a time limit on filling the order. A pro forma invoice is issued by the seller and sent to the buyer, often in response to a purchase order or oral agreement. In international transactions, the pro forma invoice may enable the buyer to open a line of credit with which to pay for the goods ordered. The pro forma invoice typically includes relevant terms and conditions that apply to the sale.

from Answers.com [answers.com]

[edited by: Demaestro at 6:35 pm (utc) on May 30, 2007]

[edited by: lorax at 8:04 pm (utc) on May 30, 2007]
[edit reason] edited for minor fair use [/edit]

jwolthuis

6:51 pm on May 30, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



I'd explain the error to the customer, but the original poster suggested the customer was threatening to take legal action. In that case, it's not a "done deal".

I've dealt with enough people calling me to take every advantage for honest mistakes, I've learned that these customers aren't in my best interest, and I refund their money and move on.

[edited by: lorax at 8:01 pm (utc) on May 30, 2007]

Jane_Doe

6:53 pm on May 30, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member Top Contributors Of The Month



Then you are hooped. Once the funds are taking the deal is done and it is up to you to come up with the goods or services.

I've had money refunded on many occassions when I've made an online purchase and the store finds out later that the item is out of stock or unavailable from a third party shipper. Not every store has 100% real time updated, computerized inventory systems, nor can they control what happens when their supplier or drop shipper is out of stock.

[edited by: Jane_Doe at 6:55 pm (utc) on May 30, 2007]

trinorthlighting

6:54 pm on May 30, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



If his credit card was never charged, he does not have any legal ground to stand on. Void the transaction and do not worry about threats that will never come. If he wants to try to sue you you can countersue for a frivolous lawsuit. Remember, the credit card transaction never settled so you do not have a liability to him.

Make sure you have disclaimers in your TOS or Policies that give you the right to cancel any transaction at any time for any reason. That will give you the full right to cancel any order in a reasonable amount of time.

Trust me, these types of clauses are in many major credit card proccessing companies TOS and you have the legal right to have it in your policies as well.

bakedjake

6:56 pm on May 30, 2007 (gmt 0)

WebmasterWorld Administrator 10+ Year Member Top Contributors Of The Month



A $200 item wound up being listed for $1. Well this customer saw this snafu and tried to place an order for it.

Was it really only one customer?

If so, make it a PR stunt. Say he's your one millionth customer and was the winner of the secret $1 sale. Get his picture with the item, put it on a page, and put a bunch of balloon clipart up. Go nuts. Do a press release about it.

Heck, maybe you'll get some local press from it.

Why piss off a customer for $199? That customer will buy from you forever if you honor that price.

Welcome to WebmasterWorld!

stajer

6:59 pm on May 30, 2007 (gmt 0)

10+ Year Member



Daemastro - The UCC only applies to sales of goods between commerical parties (both parties must be commercial entities) - it does not cover the sale of goods by a merchant to an individual consumer.

In the US, the issue is when is the order confirmed. Listing items for sale on a website is not necessarily an offer that can be accepted just by using the checkout process. The merchant can reserve himself the right to accept the buyer's offer to buy. This case will probably be determined by the language on the website and in any confirmation emails sent. If you confirmed the order through an auto confirmation email, then there is an enforceable contract.

IAL

Demaestro

7:09 pm on May 30, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member Top Contributors Of The Month



jwolthuis.... sorry for the attack... I do get what you are saying... just the lying part gets me... I hate when someone's excuse is not valid. I would be more enclined to pursue it if they lied to me then if they just said "we screwed up, sorry" that is just me though... some people are way more difficult to deal with then I

stajer... thanks for the clue in about the UCC... I will say that is possible that you could be dealing with a commercial entity and not an individual... Credit cards are issued in corporation names so it could apply.

The point I was trying to make, and you did back it up, is that if you send out an order confirmation then that looks to be enforceable as far as sales contract law is concerned.

trinorthlighting

8:19 pm on May 30, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



Its only a enforcable contract when the credit card gets charged. That is how a judge would look at it. If money never echanged hands you can not call it a contract. An automated email is not validated as a contract. Only a signed document or proof that money was exchanged makes a contract valid on an eccomerce site.

Additionally, if the seller is suspicious of fraud, they have the right to immediately notify the person and refund the credit card. But in this case, the credit card was never charged.

stajer

9:32 pm on May 30, 2007 (gmt 0)

10+ Year Member



tender and acceptance of payment is one factor, but not determinative of whether an enforceable contract exists. The real issue is when and whether the parties intended to be bound - each party may have a different understanding and expectation.

BradleyT

7:32 pm on Jun 1, 2007 (gmt 0)

10+ Year Member



If the card WAS charged, couldn't the merchant just say, "upon talking to the customer on the phone I felt like this was a fraudulent transaction so I cancelled it".

oldpro

11:32 pm on Jun 4, 2007 (gmt 0)

10+ Year Member



You are in the USA...

It was an error while updating your website. You are under no obligation to the buyer to sell. Just tell him the truth and move on.

This 48 message thread spans 2 pages: 48