How to Get Your Money Back on Purchases That Turned Out to Be Less Valuable

What happens if you purchased an item because you were told it was one thing, only to find out after honoring your end of the bargain, that it’s quite something else – something much less valuable? For example, say you bought what you thought was an 18th-Century dresser, only to discover that it’s really an early 20th-Century reproduction. Or you bought a 1970s Trans Am thinking it had a 455 Super Duty engine, but instead it had a 350 V8. Can you do anything about it?

Under the ancient doctrine of caveat emptor, the rule of law was “the buyer beware.” But with a raft of changes in consumer laws and trade practices, there are now a wide range of laws and remedies to consumers, allowing them to contest many cases where a deal was too good to be true.

There are two different legal theories under which to proceed: breach of contract or fraud. Both follow from a basic understanding of contract law.

A Primer in Contract Law:

Parties must be able to be believe what someone tells them, in order to “have a meeting of the minds,” on which contracts must rest.

Each party to the contract must generally give what it’s supposed to, and receive what it’s supposed to. If the sale was supposed to be of an 18th-Century dresser and instead a 20th-Century dresser was sold, the contract was violated. (Note: if the contract does not expressly say that it was supposed to be 18th-Century dresser, it may still be possible for the buyer to show, by other evidence, advertisements, or testimony, that’s what the deal was supposed to be).

The defect generally has to be significant: a simple matter of the wrong color probably would not support a case for breach of contract. When a contract is violated, the injured party can always seek recompense the benefit of the bargain.

For example, a plaintiff (the injured party who is suing) may seek the difference in value between the 18th-Century original and the 20th-Century reproduction. For serious violations, it may also be possible to terminate or rescind the contract. (Of course, if the dealer has an actual 18th-Century piece, it may also be possible that the breach can be cured, or fixed, by his providing the authentic one.) However, most commonly, money damages are the usual remedy.

Tort: A Non-Contractual Remedy for a Contractual Violation

Fraud, called a tort, or a wrong occurring between two people (distinguished from fraud at criminal law), could also be alleged to support redress. One element of fraud involves deception. This would apply if there was reason to think that the seller deliberately and knowingly misrepresentedor lied about the object of the sale. If this was the casethough it can be difficult to show, since it involves getting, even if only indirectly, at the seller’s state of mindthen not only can the injured party rescind the contract or seek compensation for the diminution of value, but he may also be able to obtain additional payment as well. Several states (e.g., New Jersey and California) have laws that can increase the damage awards when establishing fraud.

Case Studies: Seeking Redress for Purchases That Turned Out to Be Less Valuable

Case Study 1: The Misrepresented Dresser

John purchased what he believed to be an 18th-Century dresser from a local antique shop. However, upon closer inspection, he discovered that the dresser was actually an early 20th-Century reproduction. Feeling deceived, John decides to explore his legal options.

Under contract law, John could argue that the seller breached the contract by misrepresenting the dresser as an 18th-Century piece. Even if the contract does not explicitly state the age of the dresser, John can provide evidence such as advertisements or testimonies to support his claim.

If successful, John could seek compensation for the difference in value between an authentic 18th-Century dresser and the reproduction. Alternatively, he may be able to terminate the contract and seek a refund. Money damages are typically the most common remedy in such cases.

Case Study 2: The Engine Swap

Sarah purchased a vintage car, a 1970s Trans Am, with the belief that it had a powerful 455 Super Duty engine. However, after further inspection, she realizes that the car is equipped with a less valuable 350 V8 engine instead. Sarah feels that the seller intentionally misrepresented the car’s specifications and wants to take legal action.

Sarah could allege fraud as a tort, claiming that the seller deliberately and knowingly lied about the car’s engine. Proving fraud can be challenging since it requires establishing the seller’s state of mind. However, certain jurisdictions have laws that increase damage awards for fraud cases.

If Sarah can successfully prove fraud, she may be entitled to not only seek compensation for the diminished value of the car but also additional damages. The specific remedies available will depend on the laws of the jurisdiction and the severity of the breach.

Case Study 3: Resolving the Dispute

Lisa purchased an antique painting online, believing it to be an original work by a renowned artist. However, after obtaining an appraisal, she discovers that the painting is a skilled reproduction, significantly diminishing its value.

Frustrated with the misrepresentation, Lisa wants to find a resolution. Lisa could pursue legal action based on breach of contract or fraud, similar to the previous case studies. If successful, she may be eligible for remedies such as rescission, where the contract is negated and she receives a complete refund, or recovery of damages based on the loss of the bargain.

Conclusions:

Whatever theory is advanced, and whether or not suing the defendant sues in small claims court or in “regular” district or municipal court, the two basic remedies to be considered are:

1. Rescission.
2. Recovery of special damages.

1. Rescission

Rescission allows a court to negate the contract, as though it never took effect. This requires you to be “made whole,” and typically entails a complete refund or any associated costs proven in the pleadings. This is usually only available for more serious breaches.

2. Recovery of damages

The loss of the bargain or opportunity may create special damages against the defendant. This is commonly available for any breach.