February 18, 2008

I admit it. I like eBay, the largest online auction site on the Internet. You can buy an amazing variety of items on the site, including automobiles. There are literally hundreds and hundreds of different makes and models available for you to choose from in an auction setting. Buying a car in an online auction however is very different from going into a dealer and purchasing a brand new vehicle.

In the first place, most of the cars available on eBay and similar sites are used cars and all you get to see is a picture or two or three and the seller's comments. You can also look in to the history of the seller and read feedback that has been placed in his file by other people who have done business with the seller. The seller may be a private individual or company and could be located anywhere in the world.

Obviously buying a car online has some pretty specific legal implications that don't apply to buying a car locally. I have friends who bought several vehicles on eBay, some of which have been shipped in from as far as Texas without any problems. Others have not been so lucky.

The first problem I see is that of jurisdiction: although you may live in Montreal or Toronto, the seller most likely is from somewhere else and most probably lives in the United States. If the sale should go bad whose law would apply: the law of Québec or Ontario (the buyer's) or the law of Mississippi, or Texas etc. (the seller's)?

Generally speaking, according to our law, the law that would apply would be the place where the contract was made. Since the Internet is not actually a place, for practical purposes the jurisdiction is usually in the home of the person against whom the complaint is being laid. Simply speaking if you are trying to collect money or solve a problem, the best place to get a judgment against that person is in his or her home province or state.

The laws applicable in the buyer's jurisdiction may be somewhat different from those of the seller's. You should keep this in mind when making your Internet transaction.

The next thing to consider is the fact that you are buying a vehicle sight unseen. All the pictures in the world will not tell you how well it will run when you actually turn the key. The best thing to do in this situation if you are the buyer is to get the seller to commit in writing as to all the things that are wrong with a vehicle and to make some sort of guarantee that the rest is in working condition. At least in this way if you have to sue him you'll be able to use his own written statements against him.

If you are promised that the brake rotors have all been changed and then find out that only two have been changed you can show the courts that you based yourself at least in part on the seller's declarations. You may then ask the court to order a reduction in price and therefore a partial refund.

I know of one case where the person bought a car on the Internet that had been advertised to be a 1983 vehicle with low mileage. When the buyer took possession of the car he found that it was actually a 1980 car with 110,000 miles on it. When he complained to the seller he was told that the year had been an honest mistake and that as far as the seller was concerned 110,000 miles on a 23-year-old car was indeed low mileage. The buyer asked for a refund and was refused.

It was then up to the buyer to figure out how much he had overpaid. Was there really a price difference between a 1980 and 1983 vehicle? Could he convince a court that in these particular circumstances 110,000 miles does not constitute low mileage? Would he have to travel to present his claim in the seller's jurisdiction in order to have a chance of having a judgment that would be worth the paper it was written on? The whole price of the car was around $4,000 - would the whole exercise be worthwhile?

This is actually a real case that has still not reached its conclusion. The buyer decided to sue in his own home jurisdiction but was asked to provide a professional estimator's opinion as to the difference in value between the car as offered and the car as delivered. The evaluator came to the conclusion that the difference was only about three or four hundred dollars. The evaluator charged one hundred dollars for his services and the written report. Once the buyer gets a judgment he will have to see if it could be enforceable in the seller's jurisdiction.

The fact of the matter is that most people are honest and most Internet transactions go through without a hitch. Next week will discuss the legalities of importing the car that you bought and are satisfied with.

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This article is of a general nature and may not be applicable in all situations and jurisdictions. If you have a legal problem or need legal advice please consult a lawyer.

Jordan W. Charness, DSC, B.A., L.L.L, is a partner in Charness, Charness and Charness, a family law firm in Montreal that has specialized in giving personalized service to its clients since 1925. Jordan is also a car nut. His current ride is a fully restored Silver Anniversary Corvette, and he is a member of the Corvette Owner's Club. His web sites are www.jordanwcharness.com and www.charness3law.com e-mail Jordan@JordanCharness.com