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Barrister, Lawyer
Category: Consumer Protection Law
Satisfied Customers: 37007
Experience:  Attorney,16 years experience in consumer protection areas
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Who is responsible in the following situation. Mr A

Customer Question

Who is responsible in the following situation. Mr A introduces Mrs B a Collector with a collection for sale to a reputable auction house. The auction houses makes an agreement with Ms B independently of Mr A to buy out the collection. At the same time the auction house tells MR A that they will sell the collection at auction and by way of a thank you offers an "introductory commission" based on the auction result. The collection does well and a nice fee is owed to MR A. Meanwhile the auction house has received an email apparently from Mrs B requesting they wire the payment for the collection giving wire instructions. It later becomes apparent that the Mrs B the client /collector never received the money for their collection because their email had been hacked and the funds as a result were never received and went to the scammer at another bank . The auction house is requested to pay out the collector Mrs B the funds agreed since they never received them . The auction house then informs Mr A that if that becomes necessary to pay again there will be no profit and in turn no introductory commission. Question # 1 who is responsible for the hacked email and the resulting loss because of wiring of the funds to the scammer and # 2 is it right that although the collection sold at a good profit Mr. A does not receive his commission in the form of the agreed share of the profits actually made at the sale the pretext being that despite the fact that the collection was sold at a profit the end result was that no profit was made .
Submitted: 9 months ago.
Category: Consumer Protection Law
Expert:  Barrister replied 9 months ago.

Hello and welcome! My name is ***** ***** I am a licensed attorney who will try my very best to help with your situation or get you to someone who can. There may be a slight delay in my responses as I research statutes or ordinances and type out an answer or reply, but rest assured, I am working on your question.


If the auction house received an email allegedly from B to wire the funds, and they did so, and the email was not actually from B, then the auction house is liable to pay B because has never received the funds that they are entitled to. Auction house should have confirmed with B that is how she wanted payment personally before just wiring funds based on an email. With fraud and hackers in the news every day, the auction house has a duty to not be negligent in their business dealings and confirm payment requests with the actual seller.


As for the commission due to A, that wasn't based on the auction house making a profit. It was based on the auction results. So regardless of whether auction house makes a profit or loss, they owe A a commission based on the actual auction results.





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