Re: [Leica] Zoom Saga

["Bryan Caldwell" <bcaldwell@softcom.net>]

Austin,

I hope this is what you've asked me to provide:

I do not believe that posting an item with reserve on eBay which one does
not own or does not have power to transfer title is, by itself, a violation
of the law. If, however, someone met the reserve before the item was
withdrawn, that might well be a different story. It is eBay's position that
a bid which meets or exceeds a reserve price constitutes a binding contract.
Entering into a binding contract to transfer title to something you do not
own or have the power to transfer is fraudulent. The problem here is that
the minute a bid is placed which meets the reserve, a binding contract has
been formed (at least according to eBay). If the seller knows he does not
have the power to pass title, he has acted fraudulently.

Listing something for which you do not have power to transfer title brings
into play several sections of eBay's User Agreement.

Section 6.1: "Your information (or any items listed therein): (a) shall not
be false, inaccurate or misleading . . .  (c) shall not infringe any third
party's . . . proprietary rights . . .  (d) shall not violate any law,
statute, ordinance or regulation (including . . . false advertising)." [for
the sake of brevity here I'm only including the relevant portions]

Section 14: "You shall comply with all applicable laws, statutes, ordinances
and regulation regarding your use of our service and your bidding on,
listing, purchase, solicitation of offers to purchase, and sales of items."

As to applicable law:

Cal Civil Code section 1572:

1572.  Actual fraud, within the meaning of this Chapter, consists in
any of the following acts, committed by a party to the contract, or
with his connivance, with intent to deceive another party thereto, or
to induce him to enter into the contract:
   1. The suggestion, as a fact, of that which is not true, by one
who does not believe it to be true;
   2. The positive assertion, in a manner not warranted by the
information of the person making it, of that which is not true,
though he believes it to be true;
   3. The suppression of that which is true, by one having knowledge
or belief of the fact;
   4. A promise made without any intention of performing it; or,
   5. Any other act fitted to deceive.

[Note that actual fraud can be with intent to decieve but it need not be. It
can be for  the purpose of inducing the other party to enter into the
contract. Look at "1" done for the purpose of inducing someone to enter into
a contract. Isn't that what happens when you post something on eBay which
you have no power to sell? Of course it doesn't violate the statute until
the contract is actually formed, i.e., the winning bid is received. Then it
is the winning bidder who has been damaged - or perhaps the rightful owner
of the item posted.]

The Uniform Commercial Code section 2-312 (which has been incorporated into
the California Commercial Code) would also be implicated when a bid meeting
the reserve price was received:

(1) Subject to subsection (2) there is in a contract for sale a warranty by
the seller that
    (a) the title conveyed shall be good, and its transfer rightful; and
    (b) the goods shal be delivered free from any security interest or other
lien or encumberance of which the buyer at the time of contracting has no
knowledge.
(2) A warranty under subsection (1) will be excluded or modified only by
specific language or by circumstances which give the buyer reasons to know
that the person selling does not claim title in himself or that he is
purporting to sell only such right or title as he or a third person may
have.
(3) [Omitted]

You also asked for relevant case law - but I'm afraid that as I write this
I'm at home, not in the law library.

I would be happy to discuss this further privately. The legalities of eBay
listings are much more complicated than they might seem at first. I
apologize to those who are tired of this thread. Again, I am not saying that
anyone here did anything illegal. It doesn't take an illegal act to violate
eBay's guidelines, nor is a fraudulent act necessarily illegal. If there is
a misrepresentation of a material fact made in order to induce someone to
enter into a contract, that seems to be covered by the above Cal Civil Code.

As pointed out by someone else, there is very little clear black and white
in the law. There are likely contrary arguments to the above and I would be
interested in discussing them. This is not my area of specialty, although I
have represented clients in a few criminal fraud cases. I certainly do not
intend my quick research to be the definitive word, but would welcome an
honest debate that focuses on the issues, not the personalities involved.

Lastly,

>>in all fraud cases there has to be injury<<

Austin, are you sure of this? If someone fraudulently writes checks on your
account but gets caught before any money is actually paid would you agree
that there is no case?

Bryan



- ----- Original Message -----
From: "Austin Franklin" <austin@darkroom.com>
To: <leica-users@mejac.palo-alto.ca.us>
Sent: Friday, March 09, 2001 6:30 PM
Subject: RE: [Leica] Zoom Saga


>
> > I would suggest that you read California Civil Code section 1572 for the
> > relevant definition of "fraud," not the dictionary. eBay, with
> > headquarters
> > in California, specifies that its User Agreement is to be
> > interpreted under
> > California law.
>
> How about you post that law here and enlighten me?  Since your 'are' an
> attorney, you should know this is absurd to claim this was fraud and it
> wouldn't even pass the laugh test in court.  No one was injured.  There is
> no plaintiff...
>
> > but it clearly is a violation of eBay's User Agreement -
> > which everyone who lists an item agrees to follow.
>
> Please cite the section of the eBay user agreement that CLEARLY this is
> against.  As you should know, since you say you are an attorney, what the
> word REASONABLE is WRT the law.  All the seller had to have was a
reasonable
> assertion that s/he had consummated a deal to acquire this item.  It's
> called a mistake, not fraud.
>
> Oh, and by the way, eBay does not make the laws.  Whether it's against
eBay
> rules or not, has nothing to do with it being legal or illegal or it even
> possibly being fraud.
>
> > A finding of fraud does not require "deliberate deception" nor "unfair
or
> > unlawful gain." I would not rely on the dictionary to render legal
advice
> > any more than I would use it to render medical advice.
>
> I don't just use any old dictionary, for this I use a legal dictionary,
> thanks.  Since you're a lawyer, what type of fraud would this be?  And
yes,
> in this case, to prove fraud, it would have to be deliberate and in all
> fraud cases there has to be injury.  Please prove me wrong by citing the
> California laws WRT fraud, and, of course, provide precedent cases that
> support your claim.
>
> Any suit in this matter would be called, with out a doubt, frivolous.  We
do
> need tort reform...especially when attorneys want to claim something this
> silly is fraud.  There are so many other REAL frauds out there to keep you
> busy...
>