QUESTION
How to get a nonrefundable deposit back?
Asked on Oct 11th, 2014 on Breach of Contract - Pennsylvania
More details to this question:
This past summer I placed a $500.00 deposit cashier's check on an unborn Shiba Inu puppy with a Shiba Inu breeder from North Carolina along with a signed contract indicating that shipping costs did not apply to me because the breeder and I verbally agreed to arrange transportation of the puppy from North Carolina to Williamsport, PA, where my fiance would pick up the puppy and also where the breeder's extended family lives. The breeder kept changing the due date of the unborn puppies from August to Septmeber, to October. I am beginning to believe there are no puppies, and she also told me that her family in Williamsport moved to Maine in August. She neglected to tell me this for almost a full month. I feel as if I'm being scammed and I want my deposit back. I asked her to call off the deal and return my deposit but she will not agree to it. She has also verbally attacked me several times when I have always been patient and kind to her. What do I do?
1 ANSWER
There are several possible grounds to get your deposit back. First, you may be able to rescind the contract on the grounds of fraud, mutual mistake, or the breeder's material breach, based on the delayed due date. You can argue (more forcefully if the contract references the date than if it doesn't) that either she defrauded you about the due date, that you were both mistaken about the due date, and/or that the breeder breached a material term of the contract by not providing the puppy by the required date, and that the contract should be rescinded on one or more of those bases. Second, the non-refundable deposit clause may be considered unenforceable as a penalty. Assuming the applicable law (probably PA, but possibly NC) is the same as New York's in this area, liquidated damages clauses (clauses providing for the amount of money one party will get if the other breaches) are enforceable only if (a) the actual damages from such a breach would be difficult to calculate; and (b) the amount of liquidated damages represents a good faith attempt to approximate what the actual damages would be. If it doesn't meet those two criteria - for example, if there is a clause in a contract that provides that I will deliver 50 pairs of socks to you by next week and if I don't I have to pay you $10,000 - the provision will be deemed a penalty, and unenforceable.
Answered on Oct 13th, 2014 at 2:28 PM