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Is It Ethical to Scam Someone into Keeping to a Deal?

December 16th, 2010

Normally I would say that two wrongs don’t make a right, but I think this is an example of a loophole in that particular ethical dilemma. If you’d rather read the whole story directly instead of the summary below, visit the page on Reddit, and then skip the next two paragraphs.

A fellow had four tickets to a sporting event scheduled to take place in less than three days, but he could not attend, so he decided to sell them on eBay using a one-day listing. The auction would end at 10:00 am the day before the event, and the terms made it clear they would have to be picked up. A woman bid $600 for the tickets, so the seller emailed her to arrange the pickup. She did not reply to the emails until almost 12 hours later–late on the night before the event–and when she did, it was to back out of buying the tickets, commenting coldly, “It’s eBay, not a car dealership. I can back out if I want.” No other buyers were still willing to purchase, so the seller was stuck with his goods, unable to use them or sell them.

So the seller comes up with an idea. Using an alternate eBay identity, he sends a message to the woman claiming to be someone who saw the auction too late, and wanted to know if she would be willing to resell the tickets for $1000. By telephone, the woman says she’ll sell them–for $1100. The deal is made, and the woman contacts the seller’s original address–not knowing it’s the same guy–and says she’ll buy the tickets after all. However, she demands that the seller come to her–and by now it’s midnight. He goes to see her, gets the money–and then cuts off the deal via the fake account. When the woman blows her top, he replies, “Ma’am, this is eBay, not a car dealership.”

Now, assume–as the seller claims–that the story is not the least bit embellished or exaggerated, and is told 100% accurately. Was the seller within his rights to do what he did? In effect, he did nothing to her that she did not do to him–promise to buy and then renege on the deal. Under ordinary circumstances, I would say that it’s not right to do so, any more than it is right to assault someone who assaulted you.

This case is a bit different, however. First of all, buying something on eBay does obligate you to pay up–in eBay’s own words, “A bid or commitment to buy on eBay is considered a contract and you’re obligated to purchase the item.” I am not clear on how far that extends legally, but my impression (not being familiar with eBay) is that a seller really doesn’t have much option save to give the non-buyer a complaint against their eBay buyer’s record–something that would probably be less than a slap on the wrist. Maybe they could sue in small claims court, but with only an email address and an eBay user name, it might not be so easy to do.

Second, the (non) buyer deprived the seller of the value of his goods by promising to pay for perishable items and then waiting until it was too late to back out of the deal; this furthered her obligation to compensate. Had she immediately informed him of her intent soon after the auction ended, he probably could have found an alternate buyer. That she ignored emails for most of the day suggests that she knew early on that there would be a problem–and even if not, it was still her responsibility to live up to her side of the contract.

The final straw, of course, is the fact that she finally agreed to the sale only to profit. This, in my mind, completely deprives her of the right to object, if she had one to start out. She claims to have backed out of the deal, but when offered a $400 boon–which she jacks up an extra hundred bucks out of greed–she quickly reclaims the buyer’s title. Now, had she told the seller, disguised as a re-buyer, that she had backed out and the original seller would probably be happy to find a new buyer, then the seller would have been screwed–and the woman would at least come across as genuinely regretful. However, as she instead tried to get $500 extra for herself out of the deal, she pretty much cements the impression that she deserves no sympathy.

From the seller’s perspective, yes, he did use a short con to get the woman to pay–he lied in order to complete the sale. And yes, he did jack up the price by $20 at the last moment, in his mind to compensate for his troubles, which included driving across town at midnight, a term not in the original deal (a compensation one can easily accept, considering the circumstances). However, he may well have been able to jack the price up even more, claiming he had found another buyer, etc.–which he did not. In the end, he did nothing but persuade a person who had wronged him to live up to their obligations.

I would call no foul on his part. But then, maybe it’s just because this kind of story is so much fun to read about.

One final–and not so satisfying–consideration: technically, the woman could probably still make her $500. When making the fake counteroffer, the seller nonetheless establishes a “meeting of minds” on the $1100 deal. If I were in the woman’s position–and had no shame–I could probably take the guy to small claims court, and might possibly win. Hopefully, the woman in this case will not figure that out.

  1. Troy
    December 16th, 2010 at 10:29 | #1

    do unto others as they would do unto you?

    This actually came into Game Theory:


  2. Tim Kane
    December 17th, 2010 at 00:58 | #2

    A judge would likely rule that the women broke her contract with the man, and find that she owed the man what she promised to pay him.

    In this case, all the man did was substitute himself for what the law would have done.

    The purpose of the law for contracts, is to function as a substitute for trust. Here we see why.

    The point of the law is to reduce the transaction cost in order to facilitate transactions. Economist have shown the greater the number of transactions, the higher the productivity and wealth of society in general.

    December 17th, 2010 at 23:32 | #3

    Well done: I am not one to palpitate over arcane points of ethics. Let’s just be commonsensical.

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