PayPal Dispute Resolution Fee

John Eckhardt

I currently have a buyer who didn't like my definition of a tiny thin and wanted to return the stamp. I advised him to so and I would refund his money upon receipt of the stamp. He said he would would file a claim with PayPal and I should respond to it. I asked him not to do that because PayPal would probably charge me an extra fee. He responded telling me he had used this method for years and PayPal never charged a refund fee and I should accept the PayPal request.

I then went about some personal business and checked my email several hours later. I had received for 3 emails from PayPal. First advising the buyer had sent me an email, then one stating a case had been set up, and a third advising the case had been escalated to claim status and I would be subject to a Dispute Resolution Fee to be determined when the case was closed. All of these were sent within a 2 hour period.

I then sent my 6th message to the buyer using HipStamp advising him his actions had created additional expense to me in excess of the 2.9% fee I was already out.

His response was:

I'm sorry that you have to pay a fee. There is no other way to handle a $650 transaction, without running the risk of losing everything. I also had to pay $19 to ship the stamp back to you. I guess it's the cost of doing commerce online. Have a good weekend.

I then sent him a message back advising the should consider Shipping easy as it only cost me $8.45 to mail the stamp to him with tracking and insurance.

Hopefully I get the stamp back. He has prepared a return label. PayPal's message states - Your buyer filed a claim. The buyer stated that the item was defective or not as described. Please be aware that due to consumer protection laws, PayPal cannot guarantee the return of your merchandise if the case is found in favor of the buyer.

This statement seems at odds with the message attached to the "refund button" option provided in how I wanted to proceed with the case which states the refund would be made after the merchandise was returned.

I'm glad my previous returns were handled directly without going through PayPal's resolution center.

Sorry for the length of this post before my question. Does anyone know how many additional dollars PayPal is planning on collecting from this transaction?

Michael Duehr

It all depends on how you handle it whether you will be charged the dispute fee or not. If you and the buyer can work this out BEFORE it's gets escalated to the next stage you should not be charged the fee. (It seems that the fees are applied once Paypal has to handle the dispute directly.)

https://www.paypal.com/us/smarthelp/article/what-is-the-paypal-dispute-fee-and-why-was-i-charged-one-faq4352

What is the PayPal Dispute Fee and why was I charged one?

The Standard Dispute Fee will be waived for Inquiries in the PayPal Resolution Center that aren’t escalated to a claim, those that are resolved amicably between the buyer and the seller, or those filed to PayPal directly as an Unauthorized transaction.

If it should be taken further along there is a link that will show you the dispute rate which on that same page

Where can I see the dispute rate for my PayPal account?

As far as the Paypal fees that you were out with the original transaction, that is not the buyers problem.

John Eckhardt

I know the PayPal fees in the original transaction are not the buyers problem. I had previously read the links you suggested. The link to dispute rate says simply directs me the the open case screen and tells me nothing about the rate. Hopefully I won't be be charged a fee because I had already agreed to make the refund before the case even filed. As previously stated, he escalated it to a claim within 2 hours of originally filing the case.

His original message to me through PayPal was - I'm not sure why you are reluctant to process the return and refund through PayPal. That is the only way that Buyer and Seller protections can be preserved. I'll ask PayPal to step in and explain. Thanks, Phil

The only "dispute" we had was the method of refund. I had told him I would refund upon receipt of stamp using PayPal. He didn't want to return the stamp to me until PayPal told him to do so. That makes no sense to me. My way of thinking, is the time to file a claim with PayPal would be, if I didn't refund his money as promised otherwise they didn't need to get involved.

Michael Duehr

From the surface it sounds like there was a bit of miscommunication how the return was suppose to be processed in the first place that was part of the problem. (I can only go by what little bit your stating here.) IE Was the buyer expecting you to pay for the return shipping or were you expecting the buyer to pay for the return shipping? The reason I say that is from your OP it sounds like the buyer ended up paying the return postage, and had the expectation of you paying the return postage. Because the first part of this statement "I'm not sure why you are reluctant to process the return" leads me to come to the conclusion that somehow the buyer feels like he is having to jump through hoops to return the stamp in the first place. And if that's the case it makes sense as to why the buyer did what he did knowing he paid $650 for the item plus shipping in the first place because he's trying to protect himself. (That's not to say the buyer should have done that)

Why did you even mention the Paypal fees you were out to begin with?

And why should the buyer have to sign up for a Shippingeasy account to return a single shipment?

John Eckhardt

I don't know how you can surmise their was a problem with my communications. As in other situations with returns, I have always agreed to accept them and refund upon receipt of the returned item. I don't make refunds before receiving the returned item. Their was never any discussion as to who would pay for the return postage.

The reason I suggested ShippingEasy is that it appears the buyer is in business based upon his comments that he has done this before and the name of the company he used to purchase the stamp. This was to advise him their were less expensive ways to ship the stamp and he didn't need to pay $19.00.

Michael Duehr

I think part of the problem may very well be that the buyer made an assumption that you would have offered to pay for the return shipping. And that's going back to the fact that you stated that the buyer was NOT happy with YOUR description of the thin. To me it seems like the problem started the 2 of you not discussing who was suppose to pay the return postage. And as a person who also buys I would expect that the seller would take care of the return postage. And as a seller I never expect the buyer to pay the return postage for my mistake and I try to make that very clear to the buyer up front so there is no misunderstanding.

I never said anything about the refund being given before it was returned.

Ron Lenke

The buyer and seller in this case thin differently

George DeKornfeld

Are you saying one loses weight quicker than the other?

Greg Doll

Commas guys,,,remember to use your commas any chance you get. They are fundamental to communication. I do think that good communication is key for issues like this and I'm sure John made every effort to resolve the issue. But sometimes one runs across someone who can be a bit difficult. I hope he gets his stamp back though regardless.

John Maloney

I don't know the players in this but it seems more like a trust issue. The buyer received a stamp that he paid $650.00 for. He found it not to his liking and, to him, wrongly described. He feels it's not worth 650 of his dollars. Now he has to send it back and hope he gets his $650.00 back. He gets nervous. He wants assurance that he will get his money back. He's gotten refunds through PayPal before and no one ever told him the seller had to pay a fee. He trusts PayPal. He doesn't trust you. And you are trying to get him not to go through PP. This makes him suspicious. After all, he blames you for sending him inferior merchandise. The truth is, this all started when you described a defect in a totally subjective way. One man's tiny thin is another man's gaping hole. And when a customer receives an item they deem as "not as described" they will question your integrity. Present an objective description with measurements and pictures. And don't expect him to leave you positive feedback.

George DeKornfeld

With a purchase price of $650, was the backside of the stamp also scanned and put into the description? If the thin could be seen (even if it means taking a picture with the stamp held up to a light source), that would seem to go a long way towards eliminating issues like these.