The Contractual Legalities of Buying and Selling on eBay: Online Auctions and the Protection of Consumers

Abstract

The precise content and scope of contract law governing the buying and the selling of goods on eBay have long been a cause for considerable concern - particularly for online users of eBay. The rise in the use of online auctions has presented the law with a number of interesting challenges in consumer protection. Clearly, there is a mismatch and fundamental discrepancy between the operation of online 'auction' sites, such as eBay, and conventional law as articulated in common law contract casebooks. This article examines the legal position of individual online auction users in Australia (buyers and sellers) and focuses on the potential risks, liabilities and obligations users may face. Very little academic attention has, so far, been paid in Australia to the legal processes and issues relating to the use of online auction sites such as eBay. It is, therefore, timely and appropriate that the issue be examined in detail and the law relating to online auction processes be clarified.

This article examines whether current law sufficiently protects Australian consumers who utilise online auctions and whether additional legislative regulatory intervention is required. The paper then looks at some judicial decisions made in Australia and overseas which have addressed the precise legal construction of eBay and its attendant responsibility to online consumers. Finally, the paper concludes that better enforcement of consumer rights is vital for online auctions.