How doI protect myself in a business transaction?
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How doI protect myself in a business transaction?
I have a new van and I want a 4 wheel drive conversion put in. There are only a few small specialty shops that do this in CA and OR however I live in NV. The job costs $16K with 1/2 up front and takes 4-8 weeks. They have good reputations but what could go wrong and how can I prevent it? Could they suddenly go bankrupt or default on a loan and get shut down with assets seized by their bank — with my van in their shop in pieces? What else could happen?
Asked on October 5, 2010 under General Practice, Nevada
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
You have identified the major problem--other, that is, than fraud of some kind (e.g. they take your money or don't do the work or deliberately do shoddy work), which is that something will happen to the vendor while they are in possession of your van. While legally, you can't lose the van for good--it's not the vendor's, so it can't be taken by their creditors, for example--it (1) can take time to clear up, depriving you of the van's use; (2) might take a lawyer's help to clear up--costly; and (3) if a "mistake" is made and the creditor thinks or the shop represents that they have title to your van, it might be sold, which would complicate further untangling the situation.
This is a risk in any transaction like this. If you have any reason to doubt the solvency of this organization, don't deal with them. Other things you can do: 1) check them out online, with Better Business, etc.--what's their reputation? Any complaints or issues? 2) Ask them to show they have insurance which would cover 3rd-party merchandise at their location in the event of fire, theft, etc. 3) Make sure you are comfortable with all terms of the contract. 4) See if you could reduce the upfront money somewhat.
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