Very interesting thread and educational too. Previously I had only contemplated an item being damaged in transit, not lost or misplaced. I clearly underestimated the ingenuity of UPS and FedEx.
As to the debate on whether the seller or buyer bears the risk of loss in transit, I did a little research (by no means complete) and came up with the following:
1. Mitch2's observation that the item belongs to the seller (and therefore the seller bears the risk of loss) until the item is delivered is correct. Nhtrans assertion on 07-21 that, unless otherwise negotiated, the BUYER bears the risk of loss during transportation is also (largely) correct. How can these apparently contradictory statements both be correct?
All states have adopted the Uniform Commercial Code, with some local variations. I have only the California version available, but I think the following provision is the same in most other states.
Unless otherwise agreed:
(a) The place for delivery of goods is the sellers place of business or, if he has none, his residence.
Notwithstanding that the seller arranges transportation, he is deemed to have delivered the goods at his residence, so the buyer would bear the risk of loss in transit unless otherwise agreed.
2. So, have the parties agreed otherwise? That was the issue raised by Nhtran in his posts today. I agree with his statement that the contract with the carrier is separate from the contract with the buyer and does not place the risk of loss on the seller. I dont agree with the rest of his observations.
a. "May be you should read the FAQ more carefully before you comment. There is a big difference between 'should' and 'must'. "Should" is aspirational but not required, "must" is required."
As far as risk of loss is concerned, I read the FAQ and it reads exactly as previously quoted by Bdgregory. The operative provision is
"The buyer and seller will determine which party is responsible for paying the shipping charges. Regardless of this determination all items shipped will be F.O.B.* destination. In other words it will ALWAYS be the responsibility of the seller to guarantee that items shipped will be as described and fully functional upon arrival."
The word will appears several times, but the word should does not appear at all.
b. "Audiogon 'customary practice' won't help anyone in a dispute."
If by "help" Nhtran means support your legal position, I disagree. I believe that the standard practices expressed in the FAQ become part of the contract between the seller and buyer, unless otherwise agreed. When the written portion of a contract (in this case, a classified ad and an exchange of e-mails) is silent on a particular subject, courts will usually refer (or defer) to practices that are customary in a trade or other association to which the contracting parties belong and under whose auspices they are conducting their transaction. Also, contracts for the sale of goods dont have to be in writing to be legally binding - written contracts are just much easier to enforce because its harder to dispute their terms later on.
If you want evidence of the importance of trade practices in the law of contracts, look no further than the creation of the legal concept of a contract itself. In the 15th and early 16th centuries, English law courts refused to recognize the concept of a contact (that mutual promises were enforceable), so merchants formed an association with its own procedures that recognized and enforced contracts among its members, creating the law merchant. Concerned about competition from this early version of alternative dispute resolution, a few decades later the law courts decided that contracts were enforceable after all and adopted many of the rules and practices of the law merchant.
Tvads assertion that the guidelines expressed in the FAQ are not compulsory is also probably true, but that simply means that the seller and buyer are free to agree to something different from the guidelines. However, in the absence of a specific agreement varying from the guidelines, those parts of the guidelines that are affirmatively stated (not merely suggested) probably are part of the contract.
