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Non-paying Escrow Buyer

Labeled as question in Legal Discussion started by GoWebnames.com, Aug 2, 2018.

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  1. GoWebnames.com

    GoWebnames.com Truth alone triumphs VIP

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    I have a small situation with an Escrow.com deal.

    A CSO of a crypto company in California approached me for a name that I own.
    After I told him the price (mid five fig), he started an Escow.com transaction, verified his account there and then told me that they will soon process the wire. Now, a week later from choosing to fund by wire, he told me that the wire information was communicated to Escrow.com. Escrow.com told me they didn't receive any wire. When the buyer was asked to provide the wire transfer receipt by me and Escrow support, he just went dead silent, not answering any emails. I think they might have changed their mind. What to do with such buyers?

    It's been a total waste of time. Is the Escrow.com agreement for a transaction legally enforceable, since the company is in California itself? Are there are any legal options or should I just scrap the transaction?
     
    Last edited: Aug 2, 2018
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  2. NYJimbo

    NYJimbo Domain Re-Animator Gold Account

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    Anyway, you cant do much with such buyers. Its really up to Escrow to figure out a way to puni$h them somehow and give you a piece of the fee/fine they hit the faker with.
     
  3. GoWebnames.com

    GoWebnames.com Truth alone triumphs VIP

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    Is the Escrow.com contract legal? That's what I had wanted ascertained.

    @Escrow.com do you want to respond on the legality? What do u do with such buyers?
     
  4. Kate

    Kate Domainosaurus Rex VIP ★★★★★★★★★★

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    E-mail is legally binding, therefore there is a written contract between you and the buyer.
    But enforcing the contract is up to you. Easier said than done and may not be worth it.

    Escrow is not going to sue on your behalf. They are not going to do anything more than send reminders and then cancel the transaction.
    It's the same with Sedo, they are just a facilitator, they are not the seller of the domain.

    (IANAL)
     
  5. GoWebnames.com

    GoWebnames.com Truth alone triumphs VIP

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    If that is the case, then they are clearly in violation of the purchase agreement.
    Can non-usa citizens file a purchase-agreement / contract violation case in the us through a lawyer? What are the fees like for sending a legal notice?
     
  6. BaileyUK

    BaileyUK Established Member

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    I can understand your frustration but as Kate mentions, There is very little point in trying to pursue this through legal channels unless you can prove some sort of additional loss due to the non-completion.

    the potential buyer is just as likely to respond that there is all sorts of identified conflicts etc, if they felt willing to respond - which I doubt. I'm surprised after your several years in this game that you haven't been let down before.

    It's likely there has been some sort of internal argument on the purchase, I wouldn't give up just yet. seven days is short-time on business transactions, though a delay is often a precursor to them coming back with a lower offer in my experience
     
  7. GoWebnames.com

    GoWebnames.com Truth alone triumphs VIP

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    I just wrote to their CEO a professional legal worded email. Their rep who wasn't responding to my mails in last 3-4 days instantly shot back a response that their accounting dept. is processing the wire and that there is no need to escalate. But they been saying to instruct the wire for last few days. Hopefully, I will see the funds in escrow soon.
     
  8. BaileyUK

    BaileyUK Established Member

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    Good news then hopefully. don't forget accounting depts always drag their heels with payments. they are always looking to round-off each Calendar month with the lowest outlay payments, it's in their nature
     
    Last edited: Aug 2, 2018
  9. jberryhill

    jberryhill Top Member John Berryhill, Ph.d., Esq. VIP ★★★★★★★★★★

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    This is one of the most common areas of misunderstanding about Escrow.com.

    The "Escrow.com agreement" is an agreement among the parties to use Escrow.com's services. It is an escrow service agreement.

    The "Escrow.com agreement" is not a sales agreement. Escrow.com does not provide a sale contract. Escrow.com provides an escrow contract under which the parties agree to use Escrow.com for escrow services.

    Now, it may be that your emails and other communications, in addition to the escrow.com agreement, provide evidence of a sale contract, but there is nothing, nada, zip, zilch, zero in the Escrow.com agreement by itself which requires the parties to actually go through with a sale.

    If you are using Escrow.com to handle escrow pursuant to your sales, and you want an enforceable sales agreement, then you should be using a sale contract which specifically requires the buyer to purchase the domain name on the agreed terms, and incorporates Escrow.com as the payment mechanism.

    Maybe an example will help....

    Let's say that Ann wants to sell her car to Bob. Ann and Bob live very far apart, so they agree to hire Charlie to drive the car from Ann's place to Bob's place after Bob pays Ann for the car. Charlie provides Ann and Bob Charlie's contract saying, "Ann and Bob agree to pay me $50 to have me drive the car from Ann's place to Bob's place when Bob pays for the car."

    Ann and Bob sign the contract with Charlie.

    Bob never pays for the car.

    So, you are asking, "Is Charlie's contract enforceable?" Well, yeah, sure. Charlie has a valid contract with Ann and Bob to deliver the car if Bob pays for the car. What Charlie's contract DOES NOT DO, is require Bob to actually pay Ann for the car. Charlie's contract is only about Charlie's service of delivering the car. Charlie's contract, and Charlie, DON'T CARE if Bob ever pays Ann for the car, or if Ann changes her mind and decides not to sell the car.

    Escrow.com is in the same position as Charlie here. What Escrow.com cares about is performing the escrow service in the event the sale actually proceeds. Escrow.com does not care about whether the sale itself goes forward.

    And, again, that's just looking solely at Escrow.com's contract. The Escrow.com agreement, in addition to other facts, may be evidence that there was a sale agreement, but by itself it simply shows that the parties had agreed to use Escrow.com to handle payment if a sale happens.

    If I had to guess, I would say that I see a variation of this question at least once a month or so. It's easily one of the most frequent misconceptions that domainers have about Escrow.com and what services they provide.

    So, in answer to your direct question, Escrow.com provides a legally enforceable ESCROW AGREEMENT.

    But in answer to "the question you are meaning to ask", the answer is that Escrow.com does not provide a SALE AGREEMENT in the first place.
     
    Last edited: Aug 3, 2018
  10. GoWebnames.com

    GoWebnames.com Truth alone triumphs VIP

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    Thx for ur explanation. In this specific case though, Escrow.com was used as a means to an end: the completion of purchase agreement reached over email.

    Any email communication with the buyer accepting to purchase something electronically is enforceable as a contract. This is what I learnt on researching and this is what I wrote to their CEO too.
     
  11. jberryhill

    jberryhill Top Member John Berryhill, Ph.d., Esq. VIP ★★★★★★★★★★

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    Correct. The agreement to use Escrow.com services may be evidence of an agreement to buy the name, but the actual agreement to buy the name will be in your other correspondence.
     
  12. GoWebnames.com

    GoWebnames.com Truth alone triumphs VIP

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    Ok, the escrow was funded and the transaction is now complete.
    Can't reveal the domain name but it was a .co sold to a popular crypto wallet company.
    Thanks Kate, BaileyUK & jberryhill for your help.
     
  13. TERADOMAIN

    TERADOMAIN Upgraded Member Gold Account VIP

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    Congratulations for the sale.

    Happy to see good ending.

    Big sale not easy to achieve and every company has their own way of moving forward so sometimes wait for couple week is better option or at least a week before we pull our trigger. But even pulling trigger must be positive way. Honestly there is no fun in deal if both party not happy. So we need to think positive how to close deal and need to be friendly with our buyer to understand their situation. They may have several priority and they just don’t think of acquiring name all the time and on other side we may be thinking only in that direction.

    All company has different situation and priorities. From our side we need to respect that and try to move positively with them.

    If I were you I will never think about what is leagal and what is not. For me I believe in a deal where both party must be happy with end result. If one of them not happy then we must try to create a situation where we both happy. Still if someone not happy then we need to respect that and move ahead in life and will take it positively as good learning lesson.

    I like more to share but I think this is enough for now.

    Just sharing as good friend and well wisher of you and all other friends who are reading this.

    Thanks
     
    Last edited: Aug 4, 2018
  14. GoWebnames.com

    GoWebnames.com Truth alone triumphs VIP

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    Thanks, I understand what you are saying.

    I just wanted to confirm the option of legal enforcement of purchase agreement reached over email, primarily because a lot of my energy was already spent in communication with the buyer over 15 days when he suddenly stopped responding and they are a very big company. I wouldn't bother much if it was an individual or a small company.

    Also, they are quite happy with the deal since I also made them an upsell of $5k after this was complete and this was without Escrow.
     

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