July 07, 2006 (Original publish date) • By Dennis Beaver
Most people believe that if they sell something “as is,” the meaning is clear – if something goes wrong, there is no guarantee of any kind, and the buyer accepts the risk of paying for repairs. However, did you know that if that “as is” sale is not handled correctly, the seller could wind up legally responsible paying for repairs?
That was the legal issue facing two families who read this column in the Eureka Times Standard, and my efforts to solve their dispute began with an e-mail from Jeannie on May 20, 2006:
We saw a 1987 Oldsmobile for sale in the neighborhood very cheap and pretty clean. We scraped together $600 and bought it. As you can guess, the next day it broke down and repairs are more than the car. The owner, at the time of the sale, said the car was in good condition and he would help us if anything went wrong, but now he is avoiding us. We do not have any money to hire a lawyer, and hope that you could tell us our rights. All I would like is to have our money refunded and I will give him the car.
I decided to call the seller, “Mike,” and after speaking with Jeannie, I placed a call to him, which he returned the next day. He was polite and struck me as honest, admitting: Yes, the car was sold AS IS but I did tell them it was in good condition, and agreed to help pay for repairs up to the cost of the car, but it is possible they did not clearly hear me say that.
Be careful of what you say in an “as is” sale
I explained to Mike that, in my opinion, he had changed an AS IS sale into one with a warranty because of his statements. “As Is” sales are discussed in California Civil Code Section 1792, and by going on line you can easily become familiar with what must be done to be sure that sale remains “as is.”
The two words AS IS generally mean that a buyer takes the car, boat, stereo – whatever it might be – with all risks of something going wrong and agreeing NOT to hold the seller responsible. However, when the item is represented as being in a certain condition, and especially with a promise of helping to pay for repairs, it becomes a sale with warranty, or, could be seen as a sale in which fraud occurred.
“Fortunately, all Jeannie wants is her money back, and so the cheapest and safest way out for you is to make that refund, or face potentially thousands of dollars in a Small Claims Court judgment for repair charges,” I explained to Mike and he agreed.
As Jeannie felt that he had avoided speaking with her, the obvious solution was to put them together on a conference call, which I attempted, getting her voice mail. Mike left a message that he would refund her money immediately.
Momma’s not happy
That should have been the end of the matter. The two should have met, exchanged the car for money, and this would not have become a story. But that’s not what happened, as within minutes of that voice-mail agreement, Mike’s mother called me, very upset.
“My son, even though he is an adult, sometimes acts in a very immature way. Those people took advantage of him! Why should he refund the money?” she asked in a somewhat upset tone of voice. Moms who worry about their kids – children of any age – are entitled to be a bit upset in these circumstances.
I explained to Mom that her adult son was truthful and agreed to Jeannie’s settlement offer. “If your son refuses to keep his word, and Jeannie takes him to Small Claims Court, she will win, and could easily sue him for much more money than the cost of the car. She could sue for breach of his oral warranty to pay for repairs, and that could be several thousand dollars. Common sense dictates honoring that agreement, no matter how much you might dislike Jeannie. It is in your son’s best interest – and your’s if it’s going to be Momma’s money. You need to make this thing go away,” I advised.
Tick Tock Tick Tock
There is a certain momentum in the resolution of these kinds of disputes. The longer they go on, the chances of success diminish. Days passed and I heard from no one, and then, on May 31, Jeannie sent me this e-mail:
“I have been out of town, but want you to know that the end result was that Mike and his mom met us and refunded our money, in full!”
Now that’s what I call a happy ending.
Dennis Beaver practices law in Bakersfield and enjoys hearing from his readers. Contact Dennis Beaver.