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San Jose bakery loses thousands of dollars after Tesla reportedly cancels large order
(www.nbcbayarea.com)
this post was submitted on 23 Feb 2024
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There is such a power disparity between large corporations and normal people or small businesses. A corporation can make a small decision that would devestate a person or small business and it doesn't affect them at all.
I don't think this is legal, since it's a custom order. This is not like a consumer ordering an off the shelf product, it's more like a verbal contract IMO, but IANAL.
depends on the cancelation clause, usually there would be a time frame before the event they could cancel. There should also be a deposit-especially for events this large...non refundable would have been ideal especially if you need to get materials & OT for staff.
They exchanged an invoice which is closer to a quote unfortunately, as invoices are not contracts with clauses.
What sucks is it would cost her more in lawyer fees to sue than she lost. Fuck Tesla.
I don't think you can bring a lawyer to small claims court, to prevent this exact scenario. Tesla might send a manager or nobody. They can't send their legal team.
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IDK if 16k is small claims, but if it is, she should definitely take it there.
$5k is the cap in my state. Should be similar in scope there.
You can't sue for the whole amount if you don't actually deliver the items. Unless the contract specifically states the entire amount is non-refundable.
You don't have a right to the profit, but you could probably get your costs and labor back. It might be easy. They might not even show up.
Small claims court rules vary widely from state to state, so it's a complete crapshoot to guess for anyone else.
Some states bar attorneys altogether, others do not; some allow attorneys in but do not allow them to directly act for their client, etc.
The total dollar amount and type of suit you can bring in small claims also differs from state to state, and can change from year to year as laws governing small claims court are rewritten. Last year your state's dollar limit might have been $7k, but it got raised by the state legislature and this year it's $10k.
Even the name varies from state to state ("magistrate's court" instead of small claims, for example).
So never assume anything about small claims court remains the same from state to state. If anyone thinks they have a small claims case, their FIRST stop should be doing a search on "small claims court rules for [state]" and looking at the web pages maintained by that state to keep from wasting time. Small claims courts are usually very friendly to pro se plaintiffs (people who act as their own attorneys) and publish really good information on how to do it yourself, just be sure to hit the state's own pages first before trusting anything else.
I wasn't even thinking of small claims court since I thought the cap was only a few thousand dollars (depending on location), but that is good to know.
Yeah, if you're an inexperienced caterer this is an unfortunate lesson.
Sue then for legal fees, also. Fat chance, I know.
It depends. Somewhere in there she said the rep switched and approved it. I would have definitely asked for something up front. But it can be confusing if you are bounces around between reps.
It's common practice to include legal and court fees in your suit.
big companies don't care, they are rich enough that they don't have to abide by contracts with little people.
So if Tesla is stupid enough to order again, she can say Okeydokey I'll be right on it, and when the delivery is due, she can just say Sorree I'm not gonna deliver anything anyway, have a nice day?
That's not a viable business environment, and surely there must be regulation to prevent businesses fucking each other off like that.
I'm not blaming the business owner here but not collecting payment upfront was a monumentally poor business decision.
From a company like Tesla it shouldn't be necessary. I can't imagine why they prefer to have their reputation tarnished for this?
I would say the polar opposite of that is true. You should get it from any order, but especially one of this size, and especially from a corporation, and especially one with a reputation of dishonesty like Tesla.
You think people are not going to buy a Tesla because they shafted a small business? You have entirely too much faith in the general population.
It shouldn't be necessary but the lesson here is always get at least half upfront and if the multi-billion dollar corporation protests ask them why they want free stuff. Custom orders should always need at least half payment up front.