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Thread: Etiquette question - broken during shipping

  1. #41
    Senior Member dirk07's Avatar
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    I already had spent much more time on this than I thought that it needs.
    But it´s important to share our thought about it, so that seller and buyer are happy at the end of the day.

    My background is working in the legal department of quite a big company >300.000 employees, >40 plants distributed all over the world, on all five continents, offering our products in nearly every country in the world.

    There are many circumstances that will cause different results when risk passes from the seller to the buyer.

    C2C, C2B, B2B, B2C?
    only online shop or is it possible to pick up,………
    place (country) of the offered item
    ……


    C2C

    Sell A offers good B for price P and buyer C buys. A ows C B. C ows A P.
    They have a contract of sale S.
    If C doesn´t pay cash, there will be two cases of the step by step deal : COD or DVP.

    In case of COD the seller bears all risks during shipment and return.

    DVP
    Delivery after payment.

    If both agree to use a third-party T for the money M ( P+/-X) to been transferred from C to A, then A has a contract M1 with T and C has a contract M2 with T. What this contract means for A,C and T is written in the terms of conditions of M1 and/or M2.

    So if T decides within the terms of condition of M1 or M2 not to transfer M to A or to refund M to C, C still ows A P, caused by the contract of sale S, as long as the terms of condition of M1 doesn´t transfer all rights of the contract S from A to T and/or M2 doesn´t transfer all dutys of the contract S from C to T. So there are other possibility. For example and this is complete obscure and you should read carefully before you accept to transfer your rights to T: T gets both rights of buyer and seller of contract S transferred. So it´s completely up to T to decide what to do. And by accepting normal paypal the seller accepts that T can charge back the already transferred P before the buyer returns B or B is delivered in same condition as sold and the even more the buyer does not need to have right according to actual jurisdiction.

    So, John and John are right saying that the seller better should pay for full insurance, if he uses one of the named companies for the transfer of the money. But only to protect himself for a financial loss, when the goods are damaged during shipment.

    In the case of bank transfer, PayPal F&F it depends what the contract of sale includes.

    Shipping or delivery?

    Shipping.

    Price P shipped destination x means shipping to destination x is included in P that C ows A.
    So destination is X and place of delivery Y is, if not declared otherwise, the place, where the seller A hands out the box with the securely packed goods B to the first carrier!

    So risk transfer from A to C is for example at the post office of the first carrier or if it is picked up at A´s house at A´s address.
    In this case the buyer bears the risk of transport and should insure to full cover.

    Price shipped x means the seller pays only shipping to place x. Not insurance, tax, costumers, fees,…….

    Article 67
    (1) If the contract of sale involves carriage of the goods and the seller is not bound to hand them over at a particular place, the risk passes to the buyer when the goods are handed over to the first carrier for transmission to the buyer in accordance with the contract of sale. If the seller is bound to hand the goods over to a carrier at a particular place, the risk does not pass to the buyer until the goods are handed over to the carrier at that place. The fact that the seller is authorized to retain documents controlling the disposition of the goods does not affect the passage of the risk.

    A shipment contract is a legal document concerning the sale of goods (transfering a tangible item for a price) and other commercial transactions that are subject to the Uniform Commercial Code (UCC). Entered into by a buyer and seller, the shipment contract states the buyer’s risk for any loss or damages that result during the shipment of goods.

    In a shipment contract, the seller has four duties: (1) to deliver the goods to a carrier; (2) to deliver the goods with a reasonable contract for their transportation; (3) to deliver them with proper documentation for the buyer; and (4) to promptly notify the buyer of the shipment (UCC, Section 2-504).


    … means Carriage Paid To (CPT) according to Incoterms.
    https://www.incotermsexplained.com/t...riage-paid-to/


    The goods arrived damaged.

    Article 66
    Loss of or damage to the goods after the risk has passed to the buyer does not discharge
    him from his obligation to pay the price, unless the loss or damage is due to an act or
    omission of the seller.

    The transportation and Logistics Council has a fairly comprehensive document on filing claims for shipping damage: http://www.tlcouncil.org/sites/defau...le_a_claim.pdf.

  2. #42
    Senior Member ejboyd5's Avatar
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    I expect to receive an item in the same condition as it was when advertised/pictured for sale. How this undamaged delivery is accomplished is solely the responsibility of the seller, starting with packaging and choice of carrier. If the seller chooses to purchase insurance to lessen his loss in case of shipping mishap, that is his business decision and does not concern me. Anything less than receipt in the "as sold" condition mandates a full return of the purchase price. This financial convention is part of the "cost of doing business" as we understand it to be worldwide.

  3. #43
    Senior Member H-viken's Avatar
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    I'm not making any comments about the transaction above. These are just my 2 cents in general.

    I think it's hard to apply incoterms to these transactions between private sellers and buyers. Although technically you are right about transfer of risk, Dirk.

    What we do here is largely based on gentleman agreements where it must be assumed that neither party is out to screw the other. With that I'm also hugely, maybe naively, disappointed that there seem to be so many issues of what I would consider fraud.

    In my opinion, unless agreed otherwise, the seller carries the risk until the buyer has the item in his/her hand. The buyer generally pays up front and thereby has most of the exposure. Whereas the seller is in full control as to how an item is packaged, the buyer can't reasonably be responsible for this. Unless the buyer has specific requests to the forwarding itself the seller is also in control. If the buyer has any request in terms of which carrier, mode of transport etc is used, then he/she also takes on some, if not all, the responsibility for the shipment. EXCEPT FOR the packaging.

    If the seller let's the buyer haggle down the price so low that adequate protection cannot be granted then that is on the seller not the buyer.
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  4. #44
    Lots of quality cut and paste there, Dirk, but irrelevant to the larger discussion we're having.

    I'd guess more than 90% of the transactions on this website are shipping to or within the U.S. - with payment originating from a U.S. account - so article 67 (related to the international sale of goods) is irrelevant. U.S. buyers enjoy the benefit of U.S. law, thank you.

    And of the 90% of transactions shipping to U.S. buyers, I'd guess at least 90% of them are paid via Paypal, Visa, MC, Amex or Discover.

    So if you're part of the remaining 1% of transactions, enjoy Dirk's post. For the other 99%, nothing has changed. Seller is responsible for any damages occurring in transit.

  5. #45
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    As someone who ships quite a bit. I agree with JP... to a point... All of my parts shipments go out Fedex with Full insurance and tracking
    Here in lies the problem. Many many buyers refuse to pay for first class shipping!! They are being Cheap. All my parts are packed very well.
    Buyers want cheap cheap shipping,,,, and then want to cry if the part is broken. Pay up for first class packing and shipping with insurance and there should Never be a problem.
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  6. #46
    It seems to me that there are far more problems and opportunities for things to go wrong with international transactions. If you're going to buy something from or sell something overseas you need to take that into account and price the transaction accordingly. It has nothing to do with the integrity of overseas buyers or sellers, but I try to source my parts domestically from known sources. If something should go wrong, it's much easier to resolve any issues.

  7. #47
    Senior Member dirk07's Avatar
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    John,

    you are right on the transaction within the U.S. and paid via Paypal, Visa, MC, Amex or Discover.
    But U.S. buyers enjoy the complete benefit of U.S. law (UCC Article 2) only within the boarders of the U.S. except for Louisiana;-)
    In case of international sale of goods, starting 1.1.1998, UCC get in line behind CISG (United Nations Convention on Contracts for the International Sale of Goods).
    And even if you declare in your contract of sale that that the contract is subjected to US law, it also means that it is subjected to CISG, cause CISG is a fundamental part of UCC.
    Fullstop.

    Example:

    national law of country of seller: transfer of risk to buyer, when good is handed to first carrier
    UCC: transfer of risk to buyer, when good is handed to buyer

    CISG regulates this. Article 67: transfer of risk to buyer, when good is handed to first carrier.





    Quote Originally Posted by LiveFromNY View Post
    Lots of quality cut and paste there, Dirk, but irrelevant to the larger discussion we're having.

    I'd guess more than 90% of the transactions on this website are shipping to or within the U.S. - with payment originating from a U.S. account - so article 67 (related to the international sale of goods) is irrelevant. U.S. buyers enjoy the benefit of U.S. law, thank you.

    And of the 90% of transactions shipping to U.S. buyers, I'd guess at least 90% of them are paid via Paypal, Visa, MC, Amex or Discover.

    So if you're part of the remaining 1% of transactions, enjoy Dirk's post. For the other 99%, nothing has changed. Seller is responsible for any damages occurring in transit.

  8. #48
    Quote Originally Posted by dirk07 View Post
    Example:

    national law of country of seller: transfer of risk to buyer, when good is handed to first carrier
    UCC: transfer of risk to buyer, when good is handed to buyer

    CISG regulates this. Article 67: transfer of risk to buyer, when good is handed to first carrier.
    Theoretically, perhaps. In reality, nope. Take it up with Amex, MC, Visa and Paypal if you don't like it.

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