From: Peter Parry on
On Wed, 30 Sep 2009 17:51:50 +0100, "Peter Crosland"
<g6jns(a)yahoo.co.uk> wrote:


>Paypal are not just offering an ADR service. They are offering a service
>that gives, subject to certain condiditons, a guarantee that the buyer will
>be protected against loss if the seller fails in some way to provide goods
>that are satisfactory and then refuses to refund the seller.

In order to do this they apply, as you say, certain conditions.
Conditions which are quite reasonable as they allow them to run the
scheme at low cost.

>That contract
>between PayPal and the buyer is subject to the provisions of the legislation
>that prevenst unfair terms in consumer contracts.

You would be hard pressed to show that a service offered above what is
required by law would be "unfair" in contractual terms simply because
they will only accept tracked returns. A perfectly reasonable
explanation would be that only by offering a largely automated service
can they afford to offer any ADR service at all. The alternative to
doing it as they do is simply not to do it.
From: Peter Crosland on
"Peter Parry" <peter(a)wpp.ltd.uk> wrote in message
news:91m7c51hob29q38pspmp6cgm2752gh0jkq(a)4ax.com...
> On Wed, 30 Sep 2009 17:51:50 +0100, "Peter Crosland"
> <g6jns(a)yahoo.co.uk> wrote:
>
>
>>Paypal are not just offering an ADR service. They are offering a service
>>that gives, subject to certain condiditons, a guarantee that the buyer
>>will
>>be protected against loss if the seller fails in some way to provide goods
>>that are satisfactory and then refuses to refund the seller.
>
> In order to do this they apply, as you say, certain conditions.
> Conditions which are quite reasonable as they allow them to run the
> scheme at low cost.
>
>>That contract
>>between PayPal and the buyer is subject to the provisions of the
>>legislation
>>that prevenst unfair terms in consumer contracts.
>
> You would be hard pressed to show that a service offered above what is
> required by law would be "unfair" in contractual terms simply because
> they will only accept tracked returns. A perfectly reasonable
> explanation would be that only by offering a largely automated service
> can they afford to offer any ADR service at all. The alternative to
> doing it as they do is simply not to do it.

You really don't understand how the law works do you? The fact that
something may be difficult does not alter the fact that terms that are
unfair to the consumer are not sustainable in court. The whole point of the
legislation is to prevent companies from using their power to put the
consumer at a disadvantage. PayPal have decided that they can get away with
applying a condition that is unlawful and I assume they have taken the view
that most consumers will just accept this. As many other traders before have
found the courts will support the consumer. What many large companies do is
take a risk that they will get away with it because this is more profitable
than complying. When they find someone prepared to fight them they just pay
up quietly without admitting liability. Regrettably Trading Standards are
not given the resources to deal with this sort of unscrupulous behaviour.

Peter Crosland


From: Peter Parry on
On Thu, 1 Oct 2009 07:50:12 +0100, "Peter Crosland"
<g6jns(a)yahoo.co.uk> wrote:

>"Peter Parry" <peter(a)wpp.ltd.uk> wrote

>> You would be hard pressed to show that a service offered above what is
>> required by law would be "unfair" in contractual terms simply because
>> they will only accept tracked returns. A perfectly reasonable
>> explanation would be that only by offering a largely automated service
>> can they afford to offer any ADR service at all. The alternative to
>> doing it as they do is simply not to do it.
>
>You really don't understand how the law works do you?

Quite possibly not.

>The fact that
>something may be difficult does not alter the fact that terms that are
>unfair to the consumer are not sustainable in court.

You don't seem to be familiar with the UTCCR 1999 as they allow
contract terms which are patently unfair to the consumer to be
applied. They only apply to some, not all, of the terms of consumer
contracts. In particular they do not apply to either core terms or
matters of price in a contract.

let's look at the PayPal contract and how the Regulations apply to
them.

Paypal offer to private and business sellers a level of protection
over and above that provided in law. For business sellers the
contract is perfectly enforceable (and in any event the UTCCR do not
apply) so we won't consider them any more, only private sellers.

PayPal offer what in effect is a combination of ADR and insurance. A
core part of the contract is the eligibility requirement set out in
para 11.6 and 11.7 of their terms. That section lays out the
conditions under which PayPal agree to provide recompense to the
seller if the transaction goes wrong. They have no statutory
requirement to provide such protection, it is a purely commercial
decision presumably to attract more sellers. 11.6 and 11.7 contain
the core terms of the contract for seller protection.

Core terms are those defining the "product" (in this case seller
protection). They tell the buyer about the main subject matter of the
contract. As these are core terms of the contract the UTCCR do not
apply to them. Fairness is not required of them.

However, let us assume for now that these are not core terms and the
UTCCR do in fact apply.

Schedule 2 to the Regulations list terms which may be unfair. Terms
are unfair if they seek to protect the supplier (PayPal) from claims
in law which they might otherwise face or give the supplier rights
against the consumer they would not otherwise enjoy.

Quite obviously PayPals requirement does neither. The seller
protection policy does not in any way diminish the eBay sellers legal
rights nor does it give PayPal rights against the seller they would
not otherwise have.

A term is assessed for fairness by looking at what would the position
in law be for the consumer if that term did not appear. Standard
terms cannot take away statutory protection consumers would otherwise
enjoy. Taking away the term requiring tracked shipping does not
disadvantage the consumers legal position at all.

(Note that improving the consumers _contractual_ position is not a
test applied - if it were, in this case, any requirement to produce
any proof at all would be "unfair" as it would disadvantage some users
of the service, Contracts do not have to be good - merely fair).

> The whole point of the legislation is to prevent companies from using their power to put the
>consumer at a disadvantage.

No it isn't, you should read it. It is far narrower than this. It is
not unfair for suppliers to offer goods or services that are not
exactly what the buyer may require.

For instance, an insurer can limit cover offered by including an
'excess' that the buyer _has_ to pay. This is perfectly fair as
long as it is made clear when the buyer is deciding whether to
purchase the policy. You might want a seller protection scheme which
doesn't require you to use tracked shipping but PayPal make it quite
clear they do not offer such a product. That isn't unfair.

The assessment of fairness is defined as :-

"unfairness of a contractual term shall be assessed, taking into
account the nature of the goods or services for which the contract was
concluded and by referring, at the time of conclusion of the contract,
to all the circumstances attending the conclusion of the contract and
to all the other terms of the contract or of another contract on which
it is dependent.takes into account of the nature of goods and
services." (UTCCR 6.1)

The concepts of fairness and good faith are bound together. Fairness
requires the supplier to act in good faith towards the consumer.

Lord Bingham described "Good Faith" as :-

"�The requirement� is one of fair and open dealing. Openness requires
that the terms should be expressed fully, clearly and legibly,
containing no concealed pitfalls or traps.
Appropriate prominence should be given to terms which might operate
disadvantageously to the customer. Fair dealing requires that a
supplier should not, whether deliberately or unconsciously,
take advantage of the consumer's necessity, indigence, lack of
experience, unfamiliarity with the subject matter of the
contract, weak bargaining position or any other factor listed in or
analogous to those listed in Schedule 2 of the regulations..."

Schedule 2 contains a list of terms which may be regarded as unfair
and can be seen at http://www.opsi.gov.uk/si/si1999/19992083.htm and
is amplified in OFT publication 143 and 311 obtainable via:-

http://www.oft.gov.uk/advice_and_resources/publications/guidance/unfair-terms-consumer/

Broadly these terms fall into two groups. Group 1 is about excluding
or restricting liability for death or personal injury and is of no
consequence to this discussion.

Group 2 concerns inappropriately excluding or limiting the legal
rights of the consumer vis-�-vis the seller or supplier or another
party in the event of total or partial non-performance � by the seller
or supplier of any of the contractual obligations �

Quite obviously the PayPal's seller protection scheme does not in any
way at all limit the legal right of the consumer (the seller). The
agreement is in plain language, the term is not hidden, it is obvious
to anyone. It may not be the scheme you would like but it is
perfectly fair and it is risible to suggest otherwise.

PayPal make it perfectly clear that if the item is delivered in person
the seller will not be eligible for reimbursement. They also make
clear in 11.7 exactly what is acceptable proof for the purposes of the
contract.

That isn't unfair.

>PayPal have decided that they can get away with applying a condition that is unlawful

Only in your estimation. You happen to be wrong (again).

>As many other traders before have found the courts will support the consumer.

They don't appear to have done so far (for this particular term).
There is no reason why they should.

>Regrettably Trading Standards are not given the resources to deal with this sort of unscrupulous behaviour.

Neither trading standards nor any of the many other bodies such as
Which? who are entitled to take action under the Enterprise Act have
done anything at all. Probably because PayPal, in this instance at
least, are doing nothing wrong.


From: michael adams on

"Peter Crosland" <g6jns(a)yahoo.co.uk> wrote in message
news:9rednQ2jRY06EV7XnZ2dnUVZ8mmdnZ2d(a)brightview.co.uk...

> That contract between PayPal and the buyer is subject to the
> provisions of the legislation
> that prevenst unfair terms in consumer contracts.
>
>
> Peter Crosland
>
>

That's an interesting one. AFAIAA Paypal only has the one agreement
which covers both buying and selling.

However if someone as buyer doesn't make use of any of the services
for which Paypal charges a fee, then strictly speaking there isn't any
contract between the buyer and Paypal. As a buyer isn't then paying Paypal
any consideration*. All fees are paid by the seller. Quite possibly intentionally
so on Paypal's part, for that very reason. The same will apply to eBay as well.

Consideration, which is anything given in exchange for whatever is promised,
is an essential requirement of English Contract Law.*

Basically if you're not paying anything for goods or services rendered
and never intend to, but intend to restrict your activity to the free services
provided, then there's no contract between yourself and the supplier of those
goods or services; regardless of however many promises they may make or break
in respect of those free services.

And if there's no contract in the first place then the question of unfairness
or illegality - barring an active conspiracy involving both Paypal and sellers
- simply cannot arise.


michael adams

*
http://en.wikibooks.org/wiki/UK_Contract_Law

....




From: Peter Crosland on
"michael adams" <mjadams25(a)onetel.net.uk> wrote in message
news:7iji78F31qhv9U1(a)mid.individual.net...
>
> "Peter Crosland" <g6jns(a)yahoo.co.uk> wrote in message
> news:9rednQ2jRY06EV7XnZ2dnUVZ8mmdnZ2d(a)brightview.co.uk...
>
>> That contract between PayPal and the buyer is subject to the
>> provisions of the legislation
>> that prevenst unfair terms in consumer contracts.
>>
>>
>> Peter Crosland
>>
>>
>
> That's an interesting one. AFAIAA Paypal only has the one agreement
> which covers both buying and selling.
>
> However if someone as buyer doesn't make use of any of the services
> for which Paypal charges a fee, then strictly speaking there isn't any
> contract between the buyer and Paypal. As a buyer isn't then paying Paypal
> any consideration*. All fees are paid by the seller. Quite possibly
> intentionally
> so on Paypal's part, for that very reason. The same will apply to eBay as
> well.
>
> Consideration, which is anything given in exchange for whatever is
> promised,
> is an essential requirement of English Contract Law.*
>
> Basically if you're not paying anything for goods or services rendered
> and never intend to, but intend to restrict your activity to the free
> services
> provided, then there's no contract between yourself and the supplier of
> those
> goods or services; regardless of however many promises they may make or
> break
> in respect of those free services.
>
> And if there's no contract in the first place then the question of
> unfairness
> or illegality - barring an active conspiracy involving both Paypal and
> sellers
> - simply cannot arise.


The original suggestion near the start of the thread was that an
unscrupulous buyer might make a fraudulent claim against PayPal if the
seller collected the goods and therefore the seller did not have online
proof of delivery. So it is the seller's contract with PayPal that is the
relevant one. The seller pays a fee to PayPal and therefore there is
consideration. What I am saying is that if PayPal charged the seller's
account because it had refunded a fraudulent claim by a dishonest buyer then
the seller would have a good case in court if they had, for example, a
signed receipt for the goods from the buyer. PayPal's insistance that only
proof available on line would be laughed out of court.


Peter Crosland