If a friend of mine gave me $1000 as down payment for my old van but later changed his mind, must I give the money back?

UPDATED: Oct 13, 2014

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If a friend of mine gave me $1000 as down payment for my old van but later changed his mind, must I give the money back?

Now, a few months later he has decided that he doesn’t want the van so is asking for the down payment to be returned. I did remove the van from my listings and now I did missed the season for sale. I am telling my friend I will keep the down payment as lost but at the same time I don’t have any written agreement between us that in case he decide not to get the van I can keep the money. Can I do something about it?

Asked on October 13, 2014 under Business Law, New Jersey

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

An oral (unwritten) agreement can be enforced as well as a written one. If there  was an oral agreement that you would sell him your van and that he would put down a $1,000 deposit, then if he chooses to not go ahead with the sale, you do not need to return the deposit. You would only need to return it if:

1) The agreement had been that the deposit was refundable if he changed his mind; or

2) You, not him, were the one who caused the sale to not go through.

Otherwise, you may keep the deposit.


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