A recent article in the business section of the Miami Herald shed some light on garage sale treasures that could turn out to be traps. The question asked was:
“My husband and I are accountants who also collect art objects. At a recent garage sale, we bought a yellow gemstone labeled as a topaz for $50. We weren’t sure of its identity, but since it was a fair price for a topaz of that quality, we bought it.
Afterwards we showed it to a gem expert who said it was a yellow diamond worth $5,000. We were delighted. The local paper wrote a story about it. The seller read it and is threatening to sue us to get back her gemstone. Isn’t this a case of “finders-keepers”?”
“The general rule of law is that parties are presumed to know the value of their property. If they sell for less than fair market value, they suffer the consequences. The exception is this rule may not apply if seller and buyer have unequal bargaining power, are not on a level playing field or the facts clearly show the buyer took unfair advantage of the seller.”
In this case, the couple who purchased the items were not merchants whose business involved precious stones, but as collectors, had a higher level of expertise than the average person. The article goes on to analyze the fact that they didn’t knowingly take unfair advantage of the seller, which would apply if they knew the gemstone was improperly identified by the seller as a topaz and was really a diamond.
The law says “such an expert has a duty to disclose hidden or obviously mistaken facts, and not profit from them.”
In this particular case the seller can pursue legal action but arguments can be made on both sides. Before costly litigation, try to calmly work something out with the seller if possible, and if they’ve already hired a legal representative, be sure to have your attorney speak with them to try to reach an amicable solution.