Advice and/or opinions needed

[Woodbeef]

I guess in the long run it all depends on how you feel about the whole deal. Can you easily sell the tractor,at a price you feel is reasonable? You did go out of your way to accomodate the customer,who turned out to be a non-customer in the end. What has been the tone of his negotiations? Does he understand what he did to you? If you can live with his offer,I'd take it if you think he is honest about the whole story.

 

[froggy]

I would give him back $250.00 just to get rid of the potential problem.

Had you sold the tractor and invested the $2,000 at 5%, you would only be getting $100.00 in interest for the whole year. You've made $250.00 and still have the tractor to sell.

 

[RayBee]

Dancce: ....How about $250 worth of merchandise/parts he can use
if he wants to pay shipping costs? And you will have your markup. ...Ray

 

[OkeeDon]

</font><font color="blue" class="small">( Had you sold the tractor and invested the $2,000 at 5%, you would only be getting $100.00 in interest for the whole year. You've made $250.00 and still have the tractor to sell. )</font>

That's one definition of opportunity cost. Since he's in business, it's more likely he would have invested the $2,000 in a trade-in, which he might have sold the next day for $2,500. Since he didn't get the $2K, and was holding the $500 in escrow, he was denied that opportunity.

 

[fishdoc]

My take: he made the other deal knowing he may lose the 500 and for whatever reason he decided he could let it go in a worse case scenario. I figure he will be grateful for whatever you give him. I would know up front what the terms of a deposit are and I would assume on a deal like you mentioned that I would be out 500 if I did what he did.

 

[Steve02]

Common law says you can't be unjustly enriched. Now what does that mean?

He offered you $500 to hold a tractor valued at $2000 (which was the agreed upon sale price). For arguements sake lets assume for a minute that it costs you nothing to just let it sit out on your lot (no administration costs). Months have passed and he wants to back out of the deal and wants his money back. If you are able to turn right around and sell the tractor for $2000 then he "should" be entitled to get his full $500 back. You made the money that you would have made if you sold it to him (2000). So you would be unjustly enriching yourself by keeping his $500. Now another example, if you really had to 'wheel and deal' to get rid of it and ended up selling it for $1700 then you would be entitled to keep $300 (1700 (sale price)+ 300 (of his money) = 2000; the price you initially argreed on with him).

If you have had "administration costs" to factor in (relating to this tractor), then you would subtract those numbers from the sale of the tractor.

Hope this helps. This is just common law, your local laws may have adopted a different understanding of the above.

 

[anthonyk]

Although you are probably entitled to keep all the money, I would refund half. This will teach him a lesson about business transactions, but will also be magnanimous on your part. Showing him a kind gesture will also probably go far as people begin to hear of this situation. You will look better than him, AND you will have done more than broken even.

Anthony

 

[Richard]

Why defer to "HIS" choice of $250?

Maybe send him back $100 (if anything)

 

[jpr62902]

Steve02 must be a lawyer, though I can't tell from his profile ("unjust enrichment" and "common law" are terms only lawyers and Okeedon use /forums/images/graemlins/smile.gif). His advice seems sound in the context of a legal hypothetical (that wasn't a dig on you, Steve). On the other hand, I can't help but think that your time, in and of itself, has value. Furthermore, Okeedon and GerardC make some good points -- what was your storage cost? Do you have additional taxes owed on this piece of equipment, whether inventory or personal property, etc. because the buyer backed out? What are your costs to relist the tractor for sale? What is the worth of the goodwill you gain/lose from how you handle this particular transaction or lack thereof? Chances are you gain no goodwill from sending the $250.00 back, but you sure as heck will get some bad internet press for not doing so (have ya checked out why people leave negative feedback on eBay lately?) Negotiating between a refund of $250.00 and $0.00 might be inconsequential in the grand scheme of things. I say send 'em the $250.00 and sell the thing for $2,500.00. Everybody's happy.

 

[Theowegian]

Aw, just send him his $250.00 back...but I might consider "HOLDING" the $250 for about three or four months, just like he made you wait three or four months before backing out of the deal.

If I were in your shoes, I might even consider telling him that he has a couple hundred bucks in credit, too toward the purchase of another tractor or equipment over $2000. Maybe you'ld still make a sale from him on something else....just a thought....I might get criticized from the rest of the forum members for this approach though....

dwight