Dead customer refund dilemma ...advice desperately needed

37 replies
HI
I recently purchased an existing membership site.

Today I received an email from the daughter of one of the members of the site who informed me that her dad died in October 2013 but the payments for his membership site have been paid to the membership site every month since he died.

She has now put a claim into Paypal asking for a refund for all the back payments back to that date.

While I am really sorry that she lost her dad, I literally can't afford to give her the refund.

The membership site I bought has lots of potential but it wasn't very well maintained by the previous owners and I have been investing every penny I have to try and set up a new membership site and bring the site back to it's former glory. I know I can do it, but after buying the site, investing money in updating everything etc. I literally don't have another penny to invest in it until I can relaunch it.

I don't want to add to the woman's distress but I can't afford to refund all those monthly payments.

I really would appreciate some advice.

Thank you

Joe
#advice #customer #dead #desperately #dilemma #needed #refund
  • Profile picture of the author Rich Struck
    PayPal won't reverse charges for e-goods. That is clearly spelled out in their TOS.

    I always doubt the sincerity of "someone died" emails; I learned on eBay that behind every deadbeat is someone with leukemia or the measles or whatever, all of it lies.

    I would offer to pay back one month to get rid of her.
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    • Profile picture of the author Joe Broon
      Originally Posted by Rich Struck View Post

      PayPal won't reverse charges for e-goods. That is clearly spelled out in their TOS.

      I always doubt the sincerity of "someone died" emails; I learned on eBay that behind every deadbeat is someone with leukemia or the measles or whatever, all of it lies.

      I would offer to pay back one month to get rid of her.
      Thanks for taking the time to reply

      The lady seems genuine and says that she can send me a copy of her dads death certificate but I would have thought that they would have had his financial affairs sorted out much sooner than this.

      I wasn't sure whether paypal would refund as I thought they only had a 60 day policy but they seem to be a law to themselves so I wasn't sure.

      Thanks again. Much appreciated.

      Joe
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      • Profile picture of the author BigFrank
        Banned
        Originally Posted by Joe Broon View Post

        The lady seems genuine and says that she can send me a copy of her dads death certificate
        Give me an hour and I can send you the death certificate of anyone on the planet, whether they are dead or not.
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        • Profile picture of the author Joe Broon
          Originally Posted by BigFrank View Post

          Give me an hour and I can send you the death certificate of anyone on the planet, whether they are dead or not.
          I did a quick search....eeek!!! You are right!!

          If you join a membership site and don't cancel your membership, you are totally responsible to pay the monies due for that membership. Living or dead. Case closed.
          Another great point. I have got a good case to put forward to Paypal if they don't support me on this.

          Joe
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          • Profile picture of the author Kay King
            If this woman is the legal Executor of her father's estate - she should provide you with her request in writing along with documentation (notarized court papers) proving she is the legal Administrator.

            Somehow, I don't think she can provide that proof.

            My only concern is

            I recently purchased an existing membership site.
            How recently? Were members required to re-submit the subscriptions?
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            • Profile picture of the author Joe Broon
              Originally Posted by Kay King View Post

              If this woman is the legal Executor of her father's estate - she should provide you with her request in writing along with documentation (notarized court papers) proving she is the legal Administrator.

              Somehow, I don't think she can provide that proof.

              My only concern is



              How recently? Were members required to re-submit the subscriptions?
              Hi Kay

              I am waiting for her reply, but that is another excellent question to ask if she still contests things.

              Regarding how long I have had the site...it has literally been a few weeks.

              I haven't notified the members that I have taken it over yet as I want to get everything
              in place before I ask them to transfer over to my new payment system. You might remember you gave me some valuable advice on this thread:
              http://www.warriorforum.com/main-int...uld-aware.html

              The whole thing has been a logistical nightmare...I just hope it will be a success when I relaunch it eeek!

              Thanks again for taking the time to reply

              Joe
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    • Profile picture of the author heavysm
      The immediate thought I had was: well what's your refund policy?

      If her criteria fits the refund policy, then so be it.

      Sorry to say, her life situation (or her father's, whatever) isn't necessarily the problem of your business.

      You've already voiced that you can't afford the refund, but what does the membership policy state?

      I'm not being harsh, just following the rules. It may suck from the customer perspective, but when it comes to policy you are allowed to act opposite of what emotions or apparent morality tells you.

      You can always have the change of heart and refund her, but as you said that's really not your position.
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    • Profile picture of the author SteveSki
      Originally Posted by Rich Struck View Post

      PayPal won't reverse charges for e-goods. That is clearly spelled out in their TOS.

      This may be so but only if the buyer purchased from their paypal balance. If they paid via paypal using a credit card all the buyer has to do is dispute the transaction with their bank or credit card company and paypal will refund the sale. So if you sell digital goods and someone wants to ripp you off they can simply pay through paypal using a credit card, download your product and then dispute the transaction and paypal will not fight Visa or Mastercard.
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      • Profile picture of the author BigFrank
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        Originally Posted by SteveSki View Post

        This may be so but only if the buyer purchased from their paypal balance. If they paid via paypal using a credit card all the buyer has to do is dispute the transaction with their bank or credit card company and paypal will refund the sale. So if you sell digital goods and someone wants to ripp you off they can simply pay through paypal using a credit card, download your product and then dispute the transaction and paypal will not fight Visa or Mastercard.
        If you join a membership site and don't cancel your membership, you are totally responsible to pay the monies due for that membership. Living or dead. Case closed.

        Cheers. - Frank
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    • Profile picture of the author yakim1
      Originally Posted by Rich Struck View Post

      PayPal won't reverse charges for e-goods. That is clearly spelled out in their TOS.
      PayPal is changing their TOS, in June I believe, to provide buyer protection for digital products. So marketer will no longer be able to stop refunds just because they are selling digital products.

      I hope this will be helpful,
      Steve Yakim
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  • Profile picture of the author allegandro
    Difficult question.

    First things first, is her dad really death? Sounds stupid, but I wanted to see proof.

    Second, be honest, tell her that you don't have the money to refund her, but you want to find a solution.

    Offer her a partly pay back or a payment plan.

    If she is a good person, she will also think with you. And because you open yourself to her, she will talk good about you and think with you how to solve it.
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  • Profile picture of the author Robert999
    Originally Posted by Joe Broon View Post

    HI
    I recently purchased an existing membership site.

    Today I received an email from the daughter of one of the members of the site who informed me that her dad died in October 2013 but the payments for his membership site have been paid to the membership site every month since he died.

    She has now put a claim into Paypal asking for a refund for all the back payments back to that date.

    While I am really sorry that she lost her dad, I literally can't afford to give her the refund.

    The membership site I bought has lots of potential but it wasn't very well maintained by the previous owners and I have been investing every penny I have to try and set up a new membership site and bring the site back to it's former glory. I know I can do it, but after buying the site, investing money in updating everything etc. I literally don't have another penny to invest in it until I can relaunch it.

    I don't want to add to the woman's distress but I can't afford to refund all those monthly payments.

    I really would appreciate some advice.

    Thank you

    Joe
    I think legally you are not bound to refund if user has not cancelled his subscription. It is not the duty of site owner to check whether a user is still alive or dead. Also it is not possible to verify whether she is telling truth or not. What you can do is ask her to login into his dad's account and cancel the subscription.
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  • Profile picture of the author goneill
    When a person dies, all the financial transaction have to be overseen by an administratoe either appointed by the courts / solictor.

    My questions are:
    1 How is this account even alive
    2 How is the paypal account alive
    3 How is the payment account even alive (credit card / bank account)

    It is quite possible that a family member has been operating the deceased account fraudently. Such as
    receiving monies in (Pensions etc) and letting payments go out.

    Your only legal responsibility is to cancel the membership account from the time of the notification and as a goodwill gesture give them one months fee.
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  • Profile picture of the author agmccall
    I do not understand how the charge has been going through all this time, have you verified it? When people pass away the first things done are cancelling cards and getting the financials in order.

    Who has been using the card for 1 1/2 years?

    al
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  • Profile picture of the author rhinocl
    I am not one of those who believe that every online situation needs advice from a lawyer. However in this situation it would be really helpful to have an opinion from one who knows IM well. In the meantime...
    The first thing I would do to protect myself in this situation is replace the hookup to your main bank account with one to a new bank account with less money in it. If worst comes to worst you don't want them overdrawing your main account. If practical it would be safer to open a new bank account that has no relation to Paypal and move your money and any autopays there. This way if things go against you, the problem won't cascade into your other financial affairs and you'll have time to solve it.
    Also is there any chance of getting the old owners to deal with this?
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    • Profile picture of the author discrat
      Sounds very suspicious to me. It really does. I would look into it further.

      If membership dues were debited then upon his death any and all Cards are cancelled and this should not have happened.

      Nothing wrong with questioning a complete stranger's motives


      - Robert Andrew
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  • Profile picture of the author Raydal
    The final decision is yours but I don't think that PayPal will give a refund
    for a monthly subscription. The whole idea of a subscription is that if you
    don't want to continue you cancel it. And the point is a valid one that how
    could a dead man's account still be active?

    -Ray Edwards
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  • Profile picture of the author Mike Hersh
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    • Profile picture of the author Joe Broon
      Originally Posted by Mike Hersh View Post

      If you need a partner with money to invest let me know, you sound like you have the power to make it work, and I like your approach. With that said, I really think you should refund in that specific case.
      Hi Mike

      Thanks for your input.

      Even if I wanted to, I simply can't afford to refund her especially for almost 2 years worth of back payments. In fairness, the site under the previous owner delivered everything it said and they had no way of knowing that the person had died.

      I will offer to refund her the last two months membership fee and also cancel the subscription for her.

      I am not sure how it will go down but lets see

      Joe
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  • Profile picture of the author goneill
    Joe

    Before you contact paypal just contact the women/daughter and explain to her that you are going to contact paypal but before you do, could she provide the following info

    1 Name of the legal representative who conducted her fathers estate on death.As this person will be contacted by paypal. This legal rep will then face charges of legal negligence by the daughter and the authorities.

    The women may not be telling you whole truth and by asking the above question, she may back off, as a deadmans account is not an legal entity in law. It has to be manipulated by a living person (fraud), she may realise it could open a can of worms on her side and as I said she mayback off.

    PS,
    Make no offers of compensation as this may taken acceptence of responsibilitiy

    Once she has replied you then have further info to provide to paypal.
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    • Profile picture of the author Joe Broon
      Originally Posted by goneill View Post

      Joe

      Before you contact paypal just contact the women/daughter and explain to her that you are going to contact paypal but before you do, could she provide the following info

      1 Name of the legal representative who conducted her fathers estate on death.As this person will be contacted by paypal. This legal rep will then face charges of legal negligence by the daughter and the authorities.

      The women may not be telling you whole truth and by asking the above question, she may back off, as a deadmans account is not an legal entity in law. It has to be manipulated by a living person (fraud), she may realise it could open a can of worms on her side and as I said she mayback off.

      PS,
      Make no offers of compensation as this may taken acceptence of responsibilitiy

      Once she has replied you then have further info to provide to paypal.
      HI

      Excellent points. Thank you!!

      I will do as you suggest but I also have to respond on Paypal as the claim as already been made and requires a response.

      Your advice is really helpful.

      thank you

      Joe
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  • Profile picture of the author ronrule
    As others have said, this situation isn't covered by PayPal so you should be OK there, however a Terms of Service update may be in order to prevent a similar situation from happening again.

    Generally, a membership site should not be charging for the product - they are charging for ACCESS to the product. There is a legal difference; "Access" means that the monthly fee they are paying guarantees the service will be available for them to use, whether or not they use it. Thus any circumstances other than your ability to provide that access - which, if the site is up, you did - are an end-user issue and not eligible for any refunds or credits. In this case, the fact that the user can't access the site doesn't change the fact that the site was available for use, and that's what he was paying for. Therefore his inability to access the site, or the fact that he didn't access it for a couple years, doesn't warrant a refund.

    Clarify this in your ToS to avoid future issues. This situation is extremely rare, but there will likely be cases when a person is in the hospital, traveling abroad, etc. and then wants to retroactively cancel their service. A ToS that stipulates what they're paying for is accessibility, not usage, will keep your earnings in your pocket.

    Further, you may want to throw in a death clause as well; essentially stipulating the terms of this exact scenario for future. If a person dies, define a clear time period for which a refund will be allowed. (Usually worded in such a way that it starts on the time of your formal notice, not at the time of their death).

    Frankly, this situation seems suspicious; it's unusual that a person's credit card and bank accounts would stay active for two years after their death. That means someone took over their account at the time of death and kept it active, otherwise your payments would have been declined a long time ago. I would venture a guess that this person has run into some financial trouble and is trying to use the death of a family member to their advantage to see what they can get out of companies they transacted with.
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    • Profile picture of the author Joe Broon
      Originally Posted by ronrule View Post

      As others have said, this situation isn't covered by PayPal so you should be OK there, however a Terms of Service update may be in order to prevent a similar situation from happening again.

      Generally, a membership site should not be charging for the product - they are charging for ACCESS to the product. There is a legal difference; "Access" means that the monthly fee they are paying guarantees the service will be available for them to use, whether or not they use it. Thus any circumstances other than your ability to provide that access - which, if the site is up, you did - are an end-user issue and not eligible for any refunds or credits. In this case, the fact that the user can't access the site doesn't change the fact that the site was available for use, and that's what he was paying for. Therefore his inability to access the site, or the fact that he didn't access it for a couple years, doesn't warrant a refund.

      Clarify this in your ToS to avoid future issues. This situation is extremely rare, but there will likely be cases when a person is in the hospital, traveling abroad, etc. and then wants to retroactively cancel their service, and a ToS that what they're paying for is accessibility, not usage, will keep your earnings in your pocket.
      Again, excellent points and reminder!!! Thank you.

      I think you make a very important point to include these types of scenarios in the ToS, rare as they might seem because they can cause real problems if not covered.

      I really appreciate your wise words

      Joe
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  • Profile picture of the author agmccall
    another question here. It seems this is a paypal issue, if so, how is it that you are involved? Would this not be the original owners paypal account and not yours? I am pretty sure you can not transfer a paypal account.

    You might want to see how many months were paid to your account, if any. and if only a few months you might want to just refund those. The rest should fall on the original owners.

    If you have assigned your bank account and credit card information to the original owners account, then you should immediately remove them and add your own paypal account to the site in question

    al
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  • Profile picture of the author GforceSage
    Goneill and Ronrule both have provided sound advice. When you take over someones estate, it is your responsibility to take care of all of the deceased's affairs. It is sometimes hard for the family to track everything because so many people put off organizing their paper trails because they don't think they will be dying anytime soon and will get to it later.
    If the person in charge of the estate had cancelled the credit/debit cards as they should have, this would be a none-issue. Sounds like someone needs money and is looking for ways to get some. So they want you to send money back to a dead guys card that should have been voided?

    Add terms in your TOS that state, charges will continue in the event of ones death until the account is properly cancelled by person in charge of estate and the subscriber should leave instructions stating as much. Refer to an attorney for proper wording.

    Also, if Paypal takes money from you, let them know that you will open a dispute since your customers family was negligent in managing the deceased customers business. Paypal is in a lot of trouble right now with the federal government over suspect Paypal Credit sign-ups and probably does not want heat from anything else right now.
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  • Profile picture of the author Cosmit
    Originally Posted by Joe Broon View Post

    HI
    I recently purchased an existing membership site.

    Today I received an email from the daughter of one of the members of the site who informed me that her dad died in October 2013 but the payments for his membership site have been paid to the membership site every month since he died.

    She has now put a claim into Paypal asking for a refund for all the back payments back to that date.

    While I am really sorry that she lost her dad, I literally can't afford to give her the refund.

    The membership site I bought has lots of potential but it wasn't very well maintained by the previous owners and I have been investing every penny I have to try and set up a new membership site and bring the site back to it's former glory. I know I can do it, but after buying the site, investing money in updating everything etc. I literally don't have another penny to invest in it until I can relaunch it.

    I don't want to add to the woman's distress but I can't afford to refund all those monthly payments.

    I really would appreciate some advice.

    Thank you

    Joe
    i dont believe for a second that claim
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    • Profile picture of the author BigFrank
      Banned
      Originally Posted by Cosmit View Post

      i dont believe for a second that claim
      OK, then. All sorted! :-)

      Cheers. - Frank
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  • Profile picture of the author Mark Singletary
    When you bought the site, did you buy their debt or just their assets and future profits? In real life, when businesses are bought and sold this is made pretty clear.

    Mark
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  • Profile picture of the author kk075
    Hey Joe-

    I tried to scan the other replies to see if this was already mentioned, but you should really reach out to the person you bought the site from since it is their responsibility. Just let them know the situation and exchange contact info between the two parties....then slowly walk away. This is not your problem.

    If that's not an option due to the contract you signed (which is certainly possible), then simply inform the customer that you have cancelled the account and no further bills will be sent. As harsh as it sounds, it is not your fault that the estate did not cancel the membership months ago. And unless refunds are specifically listed in your terms, you are under no legal obligation to refund anything from 2013 or even last month.

    Now, I'm not saying to be a jerk about it....but don't set yourself up for problems down the road either. Just inform the person that you recently purchased the site and you'll forward her request onto the former owner. Then stay out of it completely...nothing good can come from your replies since they could eventually be used in court against you.
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    • Profile picture of the author BigFrank
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  • Profile picture of the author Chaiwriter
    As someone who deals with death and people's estates every day in my J-O-B, I can tell you at least 10% of families are a mess when it comes to settling a decedent's estate. I just saw one today that was just being settled today and the guy passed in 2002. Often families wait too long. But more often there aren't enough assets to probate an estate so they just handle what they know about. Then years later, when the spouse passes away (or is moving out) and the house is being cleaned out, they discover more assets/liabilities that nobody knew about.
    Also, I agree that it appears you have no legal liability here. However, that won't necessarily stop the Probate attorney from deciding to send you a nasty letter. I've seen attorney's take on battles they have no business fighting, and I swear some of the attorneys don't even know they shouldn't be fighting it.
    Have you searched for the guy's obituary? That will tell you when he passed and if this person is really a relative... At least then you'll know if it's legit.
    Anyway, just my 2 cents. But the amount of time doesn't surprise me.
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    • Profile picture of the author mikren6
      Tossing in my two cents as well...

      Since I have been through the estate process myself, I'm sure it varies State to State, the burden was on me to find and cancel, close, or freeze all accounts of the deceased. I also had to wait 90 days after posting the notice of death with the court for any claims to come forward against the estate and settle them before I could distribute funds from the estate. I'm puzzled as well to the fact payments were still being made, as I had to account for all the funds being spent from the estate, or do some explaining to people, but I don't know the whole story.

      In your case, I would not worry about it and cancel the account. It's not your job to track down everyone that might be dead, could you imagine the nightmares this would create! She's probably just hoping to get money back, but the burden is on her, she notified you and it should be cancelled as of that date, just like anyone else calling to cancel, their fault it wasn't caught sooner.

      All the accounts should have been changed to prevent this type of thing from happening in the first place, lots of possible questions on her end, again not knowing the full story. The fastest way to find out who you owe money to is to change accounts...

      Now, one account was held jointly, not much I could do short of legal action, with automatic payments out of it, I just stopped deposits to it. That is not your concern either, but might be why the payments continued, again their problem.

      I remember getting a letter from an attorney 6 months later, after everything settled, requesting money and how I would be going to court if not paid, it's been 4 years since and I'm still waiting for the court date...
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      • Profile picture of the author Kay King
        I am not a lawyer but I would advise not contacting various people or services about this potential problem. I would do nothing until I had PROOF of this woman's standing with the court to act as Administrator of the estate.

        The reservation I have is what your contract/financial arrangement says about member payments and legal obligations. I remember the previous thread but don't know exactly how you handled the purchase.

        I would advise discussing this with an attorney (conversation doesn't cost much) IF this woman does have legal status and continues to push the issue.

        I don't see how you could be liable to money paid for years when you were not associated with the membership....but that might depend on the terms of your purchase contract.
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        • Profile picture of the author BigFrank
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          Well, facts are better than supposition. I spoke to my attorney this morning and he verified that my original contention is totally correct.

          It is the responsibility of the member to cancel their membership and that the member site is not liable in any way for any membership that is not cancelled, regardless of the circumstances. This is basic contract law. Additionally, this is not a dept or obligation, so even in the transfer of the site, the new owner would not be liable.

          He stated that no attorney would ever attempt to bring any action against the membership site unless they were attempting to perpetrate a fraud. Additionally, the legal costs associated with attempting to bring such an action would be prohibitive in relation to the amount of money in question.

          Those are the facts. If you don't believe them, then call YOUR attorney. In the interim, please stop scaring the OP by making him think that he is in some sort of danger of being sued.

          Cheers. - Frank
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  • Profile picture of the author Angshuman Dutta
    There's "what should I do" and "what I want to do"?

    If its a chargeback, there's no way Paypal will solve the issue for you. So, even if you don't like it you have to refund her.

    Remember, we don't live in a perfect world!
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  • Hello


    First you feel a lawyer and established the death of the person who sold the site, which is the father of this woman.

    If it is true that he is dead, then, tell her that you do not have the money and submit a payment in installments, of course, always with the sudsilio of a good lawyer.

    And you, you have to spend some money for a good lawyer, you.
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    • Profile picture of the author Kay King
      Joe -

      I'd take Frank's answer and run with it!
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