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Sam “Sammy” Roberts is an auctioneer who has a rule.

His rule is, “I never reopen the bidding.”

In over 35 years of auctioneering, he’s not reopened a bid — not once.

All of Sammy’s clients know his rule, and all of the bidders who show up for Sammy’s auctions know his rule.

We’ve wrote specifically about this issue twice:

In our analysis of the UCC 2-328, and in particular UCC 2-328 (2)

    UCC 2-328 (2) A sale by auction is complete when the auctioneer so announces by the fall of the hammer or in other customary manner. Where a bid is made while the hammer is falling in acceptance of a prior bid the auctioneer may in his discretion reopen the bidding or declare the goods sold under the bid on which the hammer was falling.

… we call your attention to one word: “may.”

The auctioneer may in his discretion reopen the bidding or declare the goods sold under the bid on which the hammer was falling.

So, the auctioneer may do either. And, it’s up to the auctioneer, and nobody else.

Sammy announces at the start of all his auctions, “Folks, we don’t reopen the bidding … if you’re out when I say, “Sold” then you best be looking at the next lot we’re selling.”

We find Sammy’s policy perfectly ethical and legal. In fact, we propose it’s proper. We cite four reasons:

  • Makes for a smoother, quicker, simpler auction overall
  • Eliminates angering the winning bidder when their win is voided
  • Encourages bidders to bid quickly and unequivocally
  • Rids auction of reopening inconsistently with perceived unfairness

Sammy’s brother, Bill “Billy” Roberts is also an auctioneer. He does reopen the bidding if a higher bid comes in “as the hammer is falling,” and has even been known to reopen the bidding if two people think they have the bid (a tie bid).

We have written about tie bids, and the fact they don’t exist. However, other than that, Billy is acting within his authority when he reopens the bidding in cases of a higher bid coming in “as the hammer is falling.”

Billy says,

    “Yea, my brother never reopens the bid, but he leaves a lot of money on the table that way. If a higher bid comes in last second at my auctions, I take it — even if I say, “Sold!” and that way I get more for my seller than Sammy does.”

Using our four reasons for not reopening the bid from above, we would analyze Billy’s view as follows:

  • Makes for a bit more complex, confusing auction overall
  • Potentially angers the winning bidder when their win is voided
  • Encourages bidders to wait to bid and bid last second
  • Opens auction to perception of inconsistently and unfairness
  • Possibly results in more money for the seller, but maybe not

We would suggest that Billy’s policy possibly results in more money for the seller. Certainly if Billy was conducting a single item auction, real estate for example, then a single reopen, resulting potentially in thousands of dollars more in proceeds may well be prudent.

However, in the case of personal property auctions, or even multiple property real estate auctions, reopening the bid after, “Sold!” even once can lead to other problems when the auction takes longer, the policy is not practiced uniformly and/or relations with a high bidder are damaged who may well be (or now may not be) a material bidder otherwise.

Outside of tie bids, we must say that Sammy’s and Billy’s policies are both ethical and legal. However, we very much advocate Sammy’s policy.

Mike Brandly, Auctioneer, CAI, AARE has been an auctioneer and certified appraiser for over 30 years. His company’s auctions are located at: Mike Brandly, Auctioneer, Keller Williams Auctions and Goodwill Columbus Car Auction. His Facebook page is: www.facebook.com/mbauctioneer. He serves as Adjunct Faculty at Columbus State Community College and is Executive Director of The Ohio Auction School.