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Am I crazy, or is this normal now?

by Jack Gordon
5 replies
I recently purchased an existing web site. It is a site that resells someone else's service.

We are using escrow.com for the transaction.

The buyer has given me the site, but is insisting on withholding information on the supplier until after I release payment.

I told him this was the whole point of escrow, so that he could give all of that before payment was released.

He is worried about getting screwed, and I am too.

How do I release payment without having the single most important piece of the puzzle in place?

What am I missing here?
#crazy #normal
  • Profile picture of the author Frank Donovan
    Jack, I take it you've established that the purchase price includes some form of contract that binds the service provider to the site (?). Otherwise, it seems like a risky deal, on the surface.

    What's the current relationship between the seller and the supplier? Is it purely business?

    If you don't know for sure, it comes down to how much, if at all, you're willing to trust this seller. My instinct would be to insist on the supplier's details before releasing payment, although you might have to plead your case to the escrow company.


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  • Profile picture of the author Jack Gordon
    The seller assured me in writing that the relationship would transfer, and I do not doubt that.

    The only dispute is whether that account transfer happens pre-payment or post-payment.

    My understanding of escrow was that it all happens pre-payment, to protect the buyer. The seller is inherently protected by the fact that I am no longer in control of the funds, and I would have to prove he did not deliver what was promised in order to back out of the sale. Something that the seller could easily disprove with our written communications to each other.

    Otherwise, why bother using escrow at all?
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    • Profile picture of the author Frank Donovan
      Yes, you've placed the funds in escrow and normally they'd be transferred to the seller when you confirm that you've received the site files.

      I don't know what was promised in your written communication, but it seems to me you could possibly claim that the transfer of the supplier relationship is an integral part of the site's functionality, and you won't confirm receipt until you get those details.
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  • Profile picture of the author kindsvater
    The purpose of an NDA is to protect the seller, which I assume there is if money is in escrow.

    Personally, I'd look at asking for my money back on the grounds the seller refuses to provide sufficient information any reasonable person would want before making completing the purchase. But given money is in escrow you need to look at what the purchase arrangement is. You might be in breach of contract if you pull out.

    .
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  • Profile picture of the author Jack Gordon
    Thank you both.
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    Fifteen Lessons I have learned over 15 years and six businesses (or, My 1000th-Post Manifesto)
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