What is the law regarding the return of a deposit?

UPDATED: Apr 21, 2014

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

Get Legal Help Today

Compare Quotes From Top Companies and Save

secured lock Secured with SHA-256 Encryption

What is the law regarding the return of a deposit?

I own an LLC and my business sold a piece of equipment to another business. A sales contract was drawn up that stated the equipment was to be moved by a specified date. A deposit of half the sale price was accepted and the balance stated to be due at the time the equipment was picked up. The buyer failed to remove the equipment by this deadline. No, 5 months later, the equipment was sold to another buyer. I received a phone call from local law enforcement and was told that I am being charged with criminal theft of the original deposit. The sales contract did not specify if the deposit was refundable or not. Where do I stand?

Asked on April 21, 2014 under Business Law, Florida


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

Refunds are only required if:

1) the seller defaulted (violated or breached) his obligations in some way, such as by not providing the product or service which was ordered, providing a defective product, etc.; or

2) the contract, agreement, or terms of sale specifically state there will be a refund.

Also, deposits are specifically not refundable when the buyer defaults, such as by not paying the balance due, again, unless the terms, etc. of sale make them refundable. From what you write, if the buyer did not pay the balance, you'd be entitled to keep the deposit as long as the equipment had been available to them when it was supposed to be. You should explain the circumstances, along with copies of the agreement of sale and any other documentation or corresondence, to the authorities, to show that you kept the deposit because the buyer defaulted.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption