Should I Buy a Boat Online?

Purchasing a boat second hand can in itself be a tricky business with a number of pitfalls. The good news is that they can be minimised. In the current market there are plenty of bargains to be had and it is becoming more and more common to see fairly expensive boats for sale on internet auctions.

George Lloyd, an existing client, had owned a number of previous boats but having been out of the market for several years, he wanted to purchase a second hand bargain that he and his family could appreciate.

He looked at a number of the boats for sale in the usual places but also searched on the internet.  Having compared prices, he saw a nice Fairline advertised on an internet auction site. It seemed to be in good condition and was being advertised due "to a family bereavement" at a reserve of more than a £30,000 below the market value

The advert seemed a good deal but the plain fact of the matter was that at the press of a button George was committing a considerable sum of money to purchase a picture of boat.

The law

When he consulted us, I advised him that generally, one of the benefits of buying anything on the internet is that you are covered by the Distance Selling Regulations 2000 and, under these, have the right to a seven day cooling off period. But this is not the case when buying on an internet auction site - the  Regulations simply do not apply and it is a case of "let the buyer beware."

Of more concern to George is that by clicking a button on an auction site he may have instantly purchased the boat.  He would have no subsequent right of survey, no contract, no deposit provisions, no proof of title, no warranties, inventory or proof of VAT payment.

Further, the status of a seller on a web auction, can in our experience, be called into question. Sellers may go to some length to describe their sale but the fact of the matter is that they usually try to sell as private individuals rather than in the course of a business.  Even if the seller has sold numerous items previously, he may well still consider that he is a private individual.  The importance of this is that the implied statutory rights that any purchaser has when buying from a retailer or manufacturer do not apply to a sale by an individual. The purchaser is then usually left with no implied rights under the Sale of Goods Act and the boat it is "sold as seen." - the old adage "let the buyer beware" applies.

The Outcome

George was advised to:

1.    Email or telephone to check the seller's identity and reasons for selling.  Has he has sold other items? Read his feedback. If he has sold several boats over the last couple of years he would be in some difficulty describing himself as a private seller.

2.    Request that a simple contract in standard form be drawn up - one that provides for warranties, description, a deposit, survey, inventory and so on. If a survey is not allowed, don't buy the boat;

3.    Ask the seller to email copies of the title and VAT documents in advance;

4.    Ask as many questions as possible about the boat's history and maintenance;

5.    Check whether the boat is registered and if so, obtain a transcript.

All these items are difficult to check on an internet auction.  However, they are essential even in the most basic purchase.  The seller may have a genuine reason for selling and wish to do so quickly but at the end of the day, it should be easy to establish his reasons and see documents.  Pay an agreed deposit to a neutral person and carry out speedy investigations.

In this case, the seller's reasons were indeed genuine. He was more than happy to allow a survey and basic contract in return for a deposit. The boat, documents and the seller were all satisfactory and ownership changed hands quickly.

Lessons Learned

The whole process can be carried out quickly and with the minimum of fuss but should not be carried out instantaneously. Treat it like a property auction. There are basic checks that can minimise the risk and these should not be bypassed. Internet sites are becoming increasingly common but tread with caution. If you are a seller, be prepared for such questions

First published in 'Motor Boat & Yachting – Europe's best motor boat magazine'. 

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