Do I Have to Refund a Deposit?
Discussion
Me and my friend put our car up for sale recently. Within 24 hours we had someone come and look at it and agree to buy it straight off. He offered to give us an $800 deposit on the $5500 price and agreed to pay the remainder within a few days. So the sale was agreed, said car taken off the road and a cheap runaround bought in its place.
Skip forward about 10 days and we still haven't recieved the full amount. The buyer has claimed he still wants it, but is being messed around by bank errors and people not paying him the money they owe. To be honest I'm fed up of it, especially as we are moving to Christchurch soon so want the car gone and the money in the bank. The buyer has agreed we can put it up for sale again, however he now wants his deposit back.
The way I see it, the deposit is non refundable but of course now he is mentioning speaking to his solicitor. If he has paid a deposit on the item, he has agreed to buy it. If he backs out, for whatever reason, then the Contract of Sale is forfit. So basically, I don't see why we should refund any of the money as we have already agreed to sell, and had the inconvienience of taking the car off the road and getting a cheap run around in its place. Legally, where do we stand? I'm pretty sure he won't have a leg to stand on but would like to make sure.
It was a private side of the road sale. We signed to say we had the deposit, but the receipt didn't specify if it was refundable or not. This is already in the SP&L forum but would like to check with anyone who knows the laws for this country
Skip forward about 10 days and we still haven't recieved the full amount. The buyer has claimed he still wants it, but is being messed around by bank errors and people not paying him the money they owe. To be honest I'm fed up of it, especially as we are moving to Christchurch soon so want the car gone and the money in the bank. The buyer has agreed we can put it up for sale again, however he now wants his deposit back.
The way I see it, the deposit is non refundable but of course now he is mentioning speaking to his solicitor. If he has paid a deposit on the item, he has agreed to buy it. If he backs out, for whatever reason, then the Contract of Sale is forfit. So basically, I don't see why we should refund any of the money as we have already agreed to sell, and had the inconvienience of taking the car off the road and getting a cheap run around in its place. Legally, where do we stand? I'm pretty sure he won't have a leg to stand on but would like to make sure.
It was a private side of the road sale. We signed to say we had the deposit, but the receipt didn't specify if it was refundable or not. This is already in the SP&L forum but would like to check with anyone who knows the laws for this country
Surely the point of the deposit is to guarantee the sale. Why take $1000 deposit if you're happy to return 900, just take $100 in the first place.
Two of my friends have put down $1000 deposits recently and then renaged on the contract forfeiting their money, neither of them considered asking for the deposit back.
Unless the conditions are extreme then it makes a mockery of the system. The deposit should be binding and non-refundable.
Two of my friends have put down $1000 deposits recently and then renaged on the contract forfeiting their money, neither of them considered asking for the deposit back.
Unless the conditions are extreme then it makes a mockery of the system. The deposit should be binding and non-refundable.
Think of it this way, in the 10 days it wasn't being sold the ideal buyer (one with cash) may have come along. I'm not a lawyer but I can't believe the guy threatening to go to his solicitor has a leg to stand on. A contract is a contract, whether it is verbal or written. Cheddar is right, he loses his deposit.
Look at
Consumer Affairs
Looks pretty clear cut
Buying privately
Generally, when you buying something privately you do not have the right to cancel the contract and you have only limited rights if something goes wrong - it is a situation of "Buyer Beware".
Can I get a deposit back if the contract is cancelled?
The general rule is that a deposit is not refundable. But there are three exceptions to this rule:
•if the trader fails to meet their side of the contract - eg, the trader cannot supply the goods you ordered
•if you and the trader have agreed that the deposit will be refundable (in full or in part). In other words, it is a term of the contract.
•if you bought the goods on layby. The sale is covered by the Layby Sales Act which sets out specific rules when a layby is cancelled.
Consumer Affairs
Looks pretty clear cut
Buying privately
Generally, when you buying something privately you do not have the right to cancel the contract and you have only limited rights if something goes wrong - it is a situation of "Buyer Beware".
Can I get a deposit back if the contract is cancelled?
The general rule is that a deposit is not refundable. But there are three exceptions to this rule:
•if the trader fails to meet their side of the contract - eg, the trader cannot supply the goods you ordered
•if you and the trader have agreed that the deposit will be refundable (in full or in part). In other words, it is a term of the contract.
•if you bought the goods on layby. The sale is covered by the Layby Sales Act which sets out specific rules when a layby is cancelled.
Edited by lestag on Wednesday 10th February 09:13
cheddar said:
Surely the point of the deposit is to guarantee the sale. Why take $1000 deposit if you're happy to return 900, just take $100 in the first place.
Two of my friends have put down $1000 deposits recently and then renaged on the contract forfeiting their money, neither of them considered asking for the deposit back.
Unless the conditions are extreme then it makes a mockery of the system. The deposit should be binding and non-refundable.
I agree absolutely. (well it's got to be better than the PH standard "+1" Two of my friends have put down $1000 deposits recently and then renaged on the contract forfeiting their money, neither of them considered asking for the deposit back.
Unless the conditions are extreme then it makes a mockery of the system. The deposit should be binding and non-refundable.
)To me that is the whole point of a deposit. You reneg, you lose it. Simple.
O/T BTW thanks for the bloody cold I've now had for 2 weeks since returning to Oz from the NZ "Summer"
Edited by tim the pool man on Wednesday 10th February 11:20
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