When an Equipment Auction Transaction Goes Bad

      It's "buyer beware" at an online equipment auction ó and it can also be "seller beware." Here are tales of some lessons learned. March 22, 2013

Question
I recently purchased a used planer on a popular woodworking equipment auction site. The planer was clearly listed as 220v single phase power. As a part time cabinet maker, that is the world I live in. I also have a day job, as many other part time cabinet makers do. The day before picking up the new planer, I sold and loaded my old planer to make room for the new one. I went and picked up the equipment, unloaded it at my shop (this was a half day ordeal from my day job without pay and was a 100 plus mile drive each way).

Immediately after unloading it, to my horror, I discovered it was 3 phase power. I immediately contacted the auction company of their mistake and was told they would do something since it was their mistake, not mine. This was late on a Friday and was told to contact them on Monday morning which I did. Sometime over the weekend, they decided to change their tune. I was told to call the seller and see what they were going to do for me since they wrote the description. I told them my contract was with the auction company, not the seller, but the auction company was washing their hands of it. The auction agent contacted the seller and they agreed to get me a Static converter to run the planer. This option was unacceptable since it de-rates the motor by 1/3 and is designed for intermittent use only.

After some wrangling, the auction company said smugly (knowing I was stuck at this point) "return it for a full refund". I asked who was going to pay for the return since it was not my fault. They claimed it was my fault for removing it in the first place. Since I cannot afford to drive 200 miles and another half day from my day job, I am stuck with it. My defense was I had no reason to look at every detail of the machine since their site documented the power requirements. Does anyone have any thoughts? Was I wrong here? Does anyone have any ideas on possible recourse?

Forum Responses
(Business and Management Forum)
From contributor K:
They were wrong, you are right. Itís time for small claims court for the cost of the new single phase motor and getting it installed.



From contributor F:
I would guess that they have some fine print that says you are responsible for verifying what condition an item is and it is up to you to preview items before the auction starts along with some disclaimer. We always base our bids on getting a problem machine. I think they are right that you need to look at the item before you remove it. Are there any photos of the motor in the listing showing the voltage?


From the original questioner:
They have weasel words about no warranty, etc .and to cover themselves in the event it doesnít work, which as an online auction buyer I fully understand. This was stated as fact, a 220v single phase machine, so why would I bother to check it?


From contributor C:
Chris Contact your local motor shop. They will probably be ok with swapping the three phase motor for a single phase motor. It will cost you some money but itís less expensive than finding a new one. The other option is to buy a rotary phase converter. The money you spend for the converter will offset any future purchases of replacement machinery. Three phase machinery is about half the cost of single phase on the used tool market. Solve this problem on your own. Sometimes you have to pick your own battles.


From contributor G:
That happened to me with a 440 three phase shaper. I had the motor rewound by the motor shop to a 220 three phase.


From contributor F:
Welcome to the world of online auctions! Your first mistake was that you made a lot of assumptions. You weren't wrong, you just didn't do your due diligence! You assumed the description was correct. Never accept written descriptions as accurate. Call and talk to someone about the machine if at all possible before bidding.

You assumed the machine would be plug and play Ė never, never, do that. When buying something you cannot see firsthand so you have no idea what youíre getting. You assumed you would have a problem free transaction as if you were buying a new machine. Even new machines come with problems - used machines from an auction! I'm not trying to pick on you, but I can't even imagine how you could sell your planer before receiving and getting running the new one?

I agree with the others - if the rest of the machine looks like it's in decent shape, get a new or used motor for it and take as much cash from them as their willing to offer instead of the convertor. I'm not saying the auction company isn't at fault either, but if you don't have the time to return it, youíre probably not going to have the time and money to chase after them in court! Even if you do I'd bet their contracts are pretty well written to protect them. My advice is to take this as a lesson learned, get the planer running, and make use of it and you'll be better prepared in the future!



From contributor L:
For the rest of you considering blind bidding - this is a good lesson. Their fine print will claim they have no responsibility, whether that would hold up in court will cost you time and money to find out. Auction notices are notoriously inaccurate. You can't even go by the photos.


From the original questioner:
I guess I should have mentioned Iím no newbie to this. I think nearly every machine I have plus tooling and lumber has come from these auctions. I have yet to have one problem with a description. Many times, I am surprised at how poor the photos are that make equipment look worse than it really is. I have seen improper descriptions in the past, sure, and have even used that to my advantage, knowing full well something is not as described (wrong model numbers are common). I know it is like buying a used car from a distance, but my point is, if youíre going to put information online it must either be accurate or you need to make some sort of reparations to make it right, or else it becomes fraud.


From contributor K:
I have bought machines several times on auctions and have had good results, but with low expectations. Last year as part of a bank settlement I was forced to sell off some equipment. The bank contracted a local auction house. Since it was to my advantage to get the best price for the equipment I prepared a thorough, accurate, and detailed listing for each piece. These were from the machinery schedule I maintain, with electrical, dust collection, weights, repairs, and etc. - a buyer's dream. Spare parts and tooling were all segregated with each machine and tagged.

The auctioneer ignored all of this. They projected sales close to 100K to the bank, and after not advertising the sale, and not distributing the info, the 12 buyers chipped in less than 30K! Molder tooling was piled with the ripsaw, sawblades were left behind - a real mess! I believe the auctioneer bought most of the good stuff for a song, and then went on to the private market to sell at a real profit.

When this was mentioned to the bank, they discarded it with a hand wave - nature of the business, they said. When asked, the auctioneer conceded that they could buy it all and resell at whatever price, and it was legal and proper. He would not tell me the details of my sale or answer why it was not even advertised. The auction world is a strange one, with different rules than most of us operate under.



From contributor C:
Human nature tends to be optimistic in these situations (I know from experience). Make sure you buy at a price that is low enough that you can cover such situations. The people who run these auctions know very well what they are doing and how people see online auctions.


From contributor F:
"It must either be accurate or you need to make some sort of reparations to make it right, or else it becomes fraud." First off most auctions have it pretty well spelled out when you sign up for the auction that the descriptions are not guaranteed to be accurate, and that you are responsible for physical inspections. I'm not sure who you bought from, but Iím fairly sure if you go back and read that stuff many of us just skip over, youíll see it all in black and white.

They've offered you two options - one to supply you with a convertor, and second to provide you with a full refund. Just because they're not providing you with what you want it doesn't mean they haven't tried to make reparations. It's not their fault if you can't or don't want to take time to return it. So the question is - what do you want?

You removed it from the property, whether in person or by your agent, at which time you accepted the machine as it was. So although it stinks that it was not accurately described, you have to take some of the responsibility too. I buy a lot of items at auctions myself so I know where youíre coming from, but I have a different perspective I guess. I never trust descriptions, and I almost always call and talk to the owner if it's a machine that's going to cost a significant amount. Not the auction house, the owner, if and when possible. Sometimes they won't know about the machine either, but it's never hurt me to ask. I always hope for the best and expect the worst, (not running, major repairs, etc.).

I think you've been very lucky to be honest. I've seen items at auctions that were both live and online that guys paid way too much money for. Machines that had broken internal parts you can't see in any photo. Machines that looked ok in the photo's but were really nothing more than parts machines. Buying something without being able to inspect it is a gamble at best and generally speaking I won't spend more than I think I can get back for parts on a machine I can't inspect. If you have a shop full of stuff you've bought blindly and this is your fist hiccup then you've been very lucky!

So I'm not sure what youíre looking for in terms of resolution, but they have made two offers for reparations. You need to decide what youíre looking for and think about how realistic your expectations are. Although it's not what you want to hear you share in the responsibility so you can't realistically expect them to go out of their way to make you happy.



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