NSW Selling puppy / holding deposit question?

Australia's #1 for Law
Join 150,000 Australians every month. Ask a question, respond to a question and better understand the law today!
FREE - Join Now

BecH

Member
6 April 2020
4
0
1
Hi I have a litter for sale.
Is there a law about holding deposits for animals/puppies?
I’d like to make sure I understand it before taking any holding deposits.
I did lots of searches but can’t find anything specifically suitable
Thanking you
BecH
 

Tim W

Lawyer
LawTap Verified
28 April 2014
3,504
687
2,894
Sydney
Are you a registered breeder, operating a proper business?
 

BecH

Member
6 April 2020
4
0
1
I’m registered as a hobby breeder. I certainly do not breed for Profit.
but tobe sure these homes are genuine I want to take deposits. It’s crazy atm and sooo many people want the pups.
 

Tim W

Lawyer
LawTap Verified
28 April 2014
3,504
687
2,894
Sydney
As a hobbyist, then typically, the Australian Consumer Law will not apply to your transactions.
The question is not "are you operating for profit",
so much as it is "are you engaged in trade of commerce" (even if no profit).
As a hobbyist, the presumption is that you are not engaged in trade or commerce.

That being said, even if the ACL doesn't,
the overall law of contract certainly applies.
This means, basically, that you (both buyer and seller) are obliged
to deal fairly and honestly with each other in all respects.

Which brings me to this...
The term "holding deposit" has no meaning.
You're either selling the dog, or you're not.
If you take an order, then you take an order.
Even if delivery is at some future time, and even payment is not in full at the time of order.
You are not required to take the animal off the market while a customer pfaffs around.

Do not think of a holding deposit as"Don't sell it to anyone else".
Think of it as "Sold to <whoever>, to be delivered when ready".
 

BecH

Member
6 April 2020
4
0
1
As a hobbyist, then typically, the Australian Consumer Law will not apply to your transactions.
The question is not "are you operating for profit",
so much as it is "are you engaged in trade of commerce" (even if no profit).
As a hobbyist, the presumption is that you are not engaged in trade or commerce.

That being said, even if the ACL doesn't,
the overall law of contract certainly applies.
This means, basically, that you (both buyer and seller) are obliged
to deal fairly and honestly with each other in all respects.

Which brings me to this...
The term "holding deposit" has no meaning.
You're either selling the dog, or you're not.
If you take an order, then you take an order.
Even if delivery is at some future time, and even payment is not in full at the time of order.
You are not required to take the animal off the market while a customer pfaffs around.

Do not think of a holding deposit as"Don't sell it to anyone else".
Think of it as "Sold to <whoever>, to be delivered when ready".
Perfect !!! Thank you soooo much.
That’s exactly what I needed to know
Thank you so much
 

Rod

Lawyer
LawTap Verified
27 May 2014
6,525
906
2,894
Note it is possible to have conditional 'holding deposits'. Most times these are non-refundable deposits where you agree not to sell the puppy to anyone for a certain period of time. But you need to be very clear to the prospective purchaser the money is non-refundable if they do not proceed with the purchase, though is refundable if you decide not to proceed with the sale. This represents a contract in its own right and is independent of the eventual sale contract.

Can get messy and is often why many people do not like using 'holding deposits'. Using the word 'deposit' is a misnomer in many situations and if you are going to use this type option, call the option something else - like '7 day holding option'. Deposit denotes part payment and is part of the final sale contract.
 

BecH

Member
6 April 2020
4
0
1
Previously answered, no abn necessary. Just for hobby purposes.
my reason for asking is with the covid19 stay home I’m getting an enormous call for puppies but I want to make sure I only get good long term homes and not the ‘I’m bored atm’ ones.
I’m hoping asking for a holding deposit it’ll sift out the time wasters and not so serious homes.
 

Tim W

Lawyer
LawTap Verified
28 April 2014
3,504
687
2,894
Sydney
Note it is possible to have conditional 'holding deposits'. Most times these are non-refundable deposits where you agree not to sell the puppy to anyone for a certain period of time. But you need to be very clear to the prospective purchaser the money is non-refundable if they do not proceed with the purchase, though is refundable if you decide not to proceed with the sale. This represents a contract in its own right and is independent of the eventual sale contract.

Can get messy and is often why many people do not like using 'holding deposits'. Using the word 'deposit' is a misnomer in many situations and if you are going to use this type option, call the option something else - like '7 day holding option'. Deposit denotes part payment and is part of the final sale contract.
Strictly speaking, rather than being a deposit, that's an "option".
What you're selling in @Rod's scenario is not the puppy.
Rather, the buyer is buying the right to choose to buy the puppy (or not)
at some future time.
It's not a question of "refundable" - they've bought a thing with a price attached.
That thing is the right to choose to buy, or not to buy, the puppy.
 

Rob Legat - SBPL

Lawyer
LawTap Verified
16 February 2017
2,311
488
2,394
Gold Coast, Queensland
lawtap.com
To round out Tim’s response, in case it’s not clear. If you don’t identify the exact puppy when taking a deposit, then you haven‘t got certainty of contract upon which to form a deposit for a sale of goods perspective. This is because while you may have agreed on a price (and therefore a ‘deposit’), you haven’t agreed on exactly what good (i.e. the exact puppy) they’re getting for that consideration.

Instead you’re selling them the right to choose a puppy under particular circumstances. It could be a straight option to purchase, it could be a right of first refusal, it could even be a ‘put and call option’ type scenario where they can exercise the option, and you can call on them to exercise the option, to buy a puppy once they’re ready for sale and a particular puppy can be identified. The amount paid for the option can either be a fee for the granting of the option (and therefore separate from the price of the puppy), or counted towards the price of the puppy in which case it becomes a de facto deposit of sorts. However, the difference is in most cases failure to exercise the option does not give a right for refund of the ‘deposit’.