So, you’re shipping a watch. Who assumes the risk?

[reverbtime]

KeithS

I now only ship from a UPS/FEDEX store to UPS/FEDEX store.

Never thought of this; this is a smart thing to do. I will probably do this when selling to international buyers from now on.

 

[Davidt]

Reminds me of the time several years ago my partner sold a fairly cheap vintage diamon ring on eBay. She had it listed for Royal Mail Special Delivery which is insured and requires a signature upon delivery.

The buyer asked for cheaper, standard first class and my partner agreed on the condition the buyer was happy that it was insured and the risk was with them.

Low and behold the buyer opens a case saying the item hasn’t arrived and wants a refund. EBay are shown the email exchange detailing how the buyer requested shipping without insurance or signature. EBay didn’t care, no proof of delivery so my partner lost the ring and the money. Obviously this was a scam but it taught me to only ever use insured postage with proof of delivery on eBay (and anywhere for that matter)

 

[watch_my_six]

Ron_W

only if delivery is included in the transaction.

If nothing else is agreed upon, legally, ownership changes hands as soon as payment is done/recieved. This means the buyer is now the owner and it is on him/her to come and get the item, or arrange shipping with insurance. This is why buyers that list ; shipping is buyers responsibility, are correct.
The same applies if you win at auction, you either get the item in person or arrange shipping yourself, maybe with help/via the auction house, but if it goes missing it is not the responsibility of the auction house.

Of course you are free ( and smart ) to arrange things differently ie. better, but there is no obligation on the buyer to arrange insurance or solve shipping problems if he does not offer such services. Or you can use an escrow like Chrono24, as they force the seller to get insurance and tracked shipping, but at the buyers expense as is usualy mentioned in the add.

And there is nothing against asking a buyer to arrange a label and pick-up themselves, especially when it is exported out of the country. It all depends on what is agreed upon.

I am no legal expert, but I don't think it's correct that "legally, ownership changes hands as soon as payment is done/received." Technically, to the extent that verbal contract law applies, wouldn't the contract be based on an exchange of funds for goods/services, so if the goods are not delivered (even if it's the courier's fault), wouldn't the seller be in breach of the contract?

As others have pointed out, the buyer and seller are free to negotiate whatever terms they prefer, including who pays for shipping (which is sort of a red herring in this context), but I always understood that if something were to go wrong, having insurance is really in order to protect the buyer, not the seller. (This is the key issue). As another point of potential evidence, I am unable to add a watch to my personal articles insurance policy until I have it in hand, which implies that ownership is apparently not transferred when it has been paid for, at least in the eyes of my insurance company.

Perhaps there is a difference between transactions that take place involving auction houses, or perhaps they specify their terms that way? Either way, even if that's how auction houses work, I don't think that necessarily means that's how non-auction house transactions work...

(Edited to fix a typo).

Edited: May 22, 2024

 

[Evitzee]

A few years ago I sold an AP to a buyer in Washington state, his address was at Microsoft HQ in Redmond. I didn't feel that comfortable sending it to a mail facility at MS, but he laughed and said 'no problem, it'll get to me with the internal mail delivery'. We agreed that once it was signed for at the delivery address my obligation was over. It worked out and he was ok with taking whatever risk there was.

 

[Ron_W]

To clarify a bit more, with a private sale the ownership transfers when payment is made, not sure about the English correct term - legal title ? to the buyer meaning it is no longer the sellers item to do with as he pleases and he should take reasonable care of it untill it is handed over.

With this the risk ! as per OP question, for damage or loss ( insurance) is now also with the buyer ( it is his ) even if the item is not at his own location/in hand. These are the standard insurance clauses. If the sellers shed burns down with your item in it is the buyers loss. But maybe covered by the sellers property insurance, please check the fine print .

So if a private seller states ; shipping is at the buyers risk and costs, and no further deal is made regarding shipping, insurance and costs, the seller made a correct statement. Seller is not obligated to offer transport, the buyer can come and pick it up, or ask the seller to arrange shipping etc at buyers costs.
But of course smart sellers will offer solutions i think, smart buyers should ask for them. All in favor say i !

In business, where i think some comments here refer to regarding "contracts and obligations" - but do private buyers on OF make contracts ?- you have about 10 different sets of transport terms ( Incoterms ) to describe transport, delivery and insurance etc as part of/included in the deal, and here are two similair to our situation ;

Ex Works;
When goods are bought or sold "Ex Works" (EXW) it means that the Seller is making the goods available at their factory or warehouse. The buyer is then free to come and pick up the goods. Ex Works places full responsibility for cost and risk with the buyer, as the buyer has to arrange everything.

CPT / CIP ;
Carriage Paid To (CPT) is an international trade term that means the seller delivers the goods at their expense to a carrier or another person nominated by the seller. The seller assumes all risks, including loss, until the goods are in the care of the nominated party at first location ( could be the carrier person or office ) agreed upon.

Carriage and insurance paid to (CIP) means that the seller will pay freight and insurance when sending goods to someone they choose at a location they both agreed on ( could be sellers residence ! ) The seller has to insure the goods being sent for 110% of their contract value. ( for container shipping ) The transfer of costs and risk takes place at different times./ locations. The seller must take out transport insurance.

And some more on auctions houses , please do read their terms before pressing buy as they may not ship abroad. Pretty standard auction house terms in EU, Italy this time but it was the same with the UK auction house ;

Casa d'Aste ( auction house ) can recommend a shipping company for the lot/s purchased only upon written request by the buyer, releasing
Casa d'Aste from any liability; for which the buyer must apply directly to the carrier.
If the buyer intends to use his/her own carrier, he/she must still pay Casa d'Aste the packaging costs.
Casa d'Aste will deliver the package to the shipper/carrier after being paid to buy the buyer. In no case, Casa d'Aste is liable for damages relating to the transport, against which the buyer may, however stipulate with the carrier, an insurance guarantee against all risks of transport.

law x insurance =

 

[gbesq]

Ron_W

To clarify a bit more, with a private sale the ownership transfers when payment is made, not sure about the English correct term - legal title ? to the buyer meaning it is no longer the sellers item to do with as he pleases and he should take reasonable care of it untill it is handed over.

With this the risk ! as per OP question, for damage or loss ( insurance) is now also with the buyer ( it is his ) even if the item is not at his own location/in hand. These are the standard insurance clauses. If the sellers shed burns down with your item in it is the buyers loss. But maybe covered by the sellers property insurance, please check the fine print .

So if a private seller states ; shipping is at the buyers risk and costs, and no further deal is made regarding shipping, insurance and costs, the seller made a correct statement. Seller is not obligated to offer transport, the buyer can come and pick it up, or ask the seller to arrange shipping etc at buyers costs.
But of course smart sellers will offer solutions i think, smart buyers should ask for them. All in favor say i !

In business, where i think some comments here refer to regarding "contracts and obligations" - but do private buyers on OF make contracts ?- you have about 10 different sets of transport terms ( Incoterms ) to describe transport, delivery and insurance etc as part of/included in the deal, and here are two similair to our situation ;

Ex Works;
When goods are bought or sold "Ex Works" (EXW) it means that the Seller is making the goods available at their factory or warehouse. The buyer is then free to come and pick up the goods. Ex Works places full responsibility for cost and risk with the buyer, as the buyer has to arrange everything.

CPT / CIP ;
Carriage Paid To (CPT) is an international trade term that means the seller delivers the goods at their expense to a carrier or another person nominated by the seller. The seller assumes all risks, including loss, until the goods are in the care of the nominated party at first location ( could be the carrier person or office ) agreed upon.

Carriage and insurance paid to (CIP) means that the seller will pay freight and insurance when sending goods to someone they choose at a location they both agreed on ( could be sellers residence ! ) The seller has to insure the goods being sent for 110% of their contract value. ( for container shipping ) The transfer of costs and risk takes place at different times./ locations. The seller must take out transport insurance.

And some more on auctions houses , please do read their terms before pressing buy as they may not ship abroad. Pretty standard auction house terms in EU, Italy this time but it was the same with the UK auction house ;

Casa d'Aste ( auction house ) can recommend a shipping company for the lot/s purchased only upon written request by the buyer, releasing
Casa d'Aste from any liability; for which the buyer must apply directly to the carrier.
If the buyer intends to use his/her own carrier, he/she must still pay Casa d'Aste the packaging costs.
Casa d'Aste will deliver the package to the shipper/carrier after being paid to buy the buyer. In no case, Casa d'Aste is liable for damages relating to the transport, against which the buyer may, however stipulate with the carrier, an insurance guarantee against all risks of transport.

law x insurance =

Respectfully, I think that the above post does anything but clarify matters. As I stated previously, unless the parties agree otherwise (and any such agreement should be in writing), the risk of loss is on the seller until the watch is delivered to the buyer. The seller should insure the watch for its full value and ship via mail or a private courier like DHL or FedEx with restricted delivery to the buyer ONLY and with the signature of the buyer required upon delivery.

 

[Ron_W]

So you say i ?

gbesq

the risk of loss is on the seller until the watch is delivered to the buyer

Show me where that is written please. It is the correct / decent / smart thing to do but i dont see it here on the mandtory list ? It is on Chrono24. And i dont see contracts being made up either here, maybe OF should provide a template with choice of shipping method ? As per the OP question, if nothing else is arranged , who bares the risk ?, it is on the buyer.

 

[gbesq]

Ron_W

So you say i ?



Show me where that is written please. It is the correct / decent / smart thing to do but i dont see it here on the mandtory list ? It is on Chrono24. And i dont see contracts being made up either here, maybe OF should provide a template with choice of shipping method ? As per the OP question, if nothing else is arranged , who bares the risk ?, it is on the buyer.

Well, let's start with this. You seem to be saying that if you and I agree that I will sell you a given watch and that we further agree that you will pay me X dollars for the watch, that this is not a legally enforceable contract? Do I understand you correctly?

 

[blubarb]

Larry S

My personal practice is to include shipping. I use parcel pro and insure it.

Unfortunately, @Larry, for us Aussies, Parcel Pro pulled out of Australia (still don't know why to this day) leaving Australians only able to insure watches sent overseas with DHL/FedEx (10k max I believe and exorbitant cost), AusPost (max. 5k) or Secursus.

Edited: May 23, 2024

 

[blubarb]

pdxleaf

I have purchased from auction houses and learned to verify before bidding if they will ship. I hadn't considered the reason so many auction houses say they don't ship is because they are passing on the liability to me, the buyer. Makes sense.

As a seller here on OF, it's easier and cleaner for me to include shipping in the price. My expectation is that if lost, I get reimbursed from insurance and refund the buyer. If I don't properly insure, it's on me.

But this is for shipping in North America, where I am located. I specify shipping to be discussed for outside NA because of the cost and what shipper the buyer wants to use. I may or may not assume responsibility, depending on what a buyer wants to do, but most often, the responsibility is on me unless the buyer says no insurance. I imagine this is similar to people who live in other areas in the world. I once had a person in South Africa ask about a watch and shipping was more than the cost of the watch. Since then, I don't just say shipping included unless specifying if it's limited to parts of the world.

It's a good question. I also wonder if anyone has lost a watch in shipment? I have, but it wasn't from a purchase, it was during a service. That experience has made me nervous every time a watch is mailed.

"I also wonder if anyone has lost a watch in shipment? I have, but it wasn't from a purchase, it was during a service. That experience has made me nervous every time a watch is mailed."

Great point. I note that Secursus does not cover watches sent to or from a service/watch repair, as was pointed out in a recent forum post elsewhere.

https://omegaforums.net/threads/stolen-watch-omega-seamaster-166-024.172432/page-2#post-2345764.

 

[Ron_W]

gbesq

Do I understand you correctly?

Apperently, and respectfully, no you dont. Let`s agree that insurance and risk is not your thing, and i agree with you we should only sell privately including insured shipping at the buyers costs ( or added in the sales price ) with a good courrier. Unless the buyer wants to arrange things himself and thereby accepting full risk.

 

[gbesq]

Ron_W

Apperently, and respectfully, no you dont. Let`s agree that insurance and risk is not your thing, and i agree with you we should only sell privately including insured shipping at the buyers costs ( or added in the sales price ) with a good courrier. Unless the buyer wants to arrange things himself and thereby accepting full risk.

I had hoped for a more useful response and a productive discussion, but I’ll simply wish you a pleasant day sir.

 

[Ron_W]

Merci, but i already answered to the OP question to the best of my knowledge and have nothing more to add.
The best of days to you as well !

 

[Gav1967]

If nothing else, this thread has re-emphasised to me the kind of people i like to do business with and has added one or two to the opposite list also.

 

[Faz]

I keep it simple. When I sell, I clearly state who is responsible for insurance. In Canada, unless you have a third party shipping insurance (Parcel Pro etc.) it’s difficult to insure a package for more than CAD $ 1,000.00. If I sell a watch that falls under 1K, I’ll provide the insurance if shipped within Canada. If I ship from within the USA to the USA, I use USPS registered mail with insurance up to 10K available. Slow but very safe. International shipping? I’ll state that the buyer assumes the risk.

 

[Archer]

Ron_W

To clarify a bit more, with a private sale the ownership transfers when payment is made, not sure about the English correct term - legal title ?

It depends on the terms. In a commercial transaction, there will be a bill of sale or something the lays out the terms, such as when the ownership of the item is transferred. In a private sale, things could get muddy very quickly, but generally I agree that once an item, has been fully paid for, the item now belongs to the buyer.

Anyone here that would argue differently should consider if they would be upset of they fully paid for a watch from a seller, and the seller decided to turn around and sell it to someone else, or keep it. Even refunding your money, you would be pissed, because "you already bought it."

gbesq

Respectfully, I think that the above post does anything but clarify matters. As I stated previously, unless the parties agree otherwise (and any such agreement should be in writing), the risk of loss is on the seller until the watch is delivered to the buyer. The seller should insure the watch for its full value and ship via mail or a private courier like DHL or FedEx with restricted delivery to the buyer ONLY and with the signature of the buyer required upon delivery.

I don't believe that any terms of sale are simply automatically applied, so I think that is the part that Ron_W is taking issue with.

What you suggest is the norm may be just that, but I don't know that it is legally binding if it's not spelled out. So the idea of having it in writing only if you are deviating from this assumed norm, might be assuming too much.

The term commonly used in sales contracts is FOB - Free On Board. It can be FOB Origin (the seller's location) or it can be FOB Destination (the final destination.) This is what determines when the risk is transferred from seller to buyer. It has to be spelled out though.

 

[DaveK]

Faz

I keep it simple. When I sell, I clearly state who is responsible for insurance. In Canada, unless you have a third party shipping insurance (Parcel Pro etc.) it’s difficult to insure a package for more than CAD $ 1,000.00. If I sell a watch that falls under 1K, I’ll provide the insurance if shipped within Canada. If I ship from within the USA to the USA, I use USPS registered mail with insurance up to 10K available. Slow but very safe. International shipping? I’ll state that the buyer assumes the risk.

Does Canada Post’s insurance cover watches?

 

[DaveK]

Thank you all, I appreciate the replies

 

[Archer]

blubarb

"I also wonder if anyone has lost a watch in shipment? I have, but it wasn't from a purchase, it was during a service. That experience has made me nervous every time a watch is mailed."

Great point. I note that Secursus does not cover watches sent to or from a service/watch repair, as was pointed out in a recent forum post elsewhere.

https://omegaforums.net/threads/stolen-watch-omega-seamaster-166-024.172432/page-2#post-2345764.

Note that your home owners or renters insurance may cover a watch in transit for servicing. Unlike in a sale where the watch has transferred ownership, when you send it for servicing, you still own it, so I know a number of my customers have said they have confirmed through their home insurance that the watch would be covered while out for servicing.

 

[Ron_W]

Gav1967

If nothing else, this thread has re-emphasised to me the kind of people i like to do business with and has added one or two to the opposite list also.

Yes, for sure. OF moderators should quickly enforce some shipping rules to the sales section imo.

Archer

what determines when the risk is transferred from seller to buyer. It has to be spelled out though.

Exactly why i reffered to the Incoterms as example of what shipping conditions can mean