Tags

, , , , , , , , ,

baitandswitchMy good friend Jason Smith asked me a rhetorical question the other day.

Let’s say an auctioneer has a live auction scheduled with online pre-bidding beginning several days prior.

How would terms such as, “Announcements made day of sale take precedence over any printed matter” be interpreted given the auction is essentially already underway?

We wrote about such announcements here: https://mikebrandlyauctioneer.wordpress.com/2012/11/18/announcements-made-day-of-sale-take-precedence/

And we wrote about offers made prior to a live auction here: https://mikebrandlyauctioneer.wordpress.com/2012/01/01/online-ownership-prior-to-auction/

Our auction today regards, for example, a live auction scheduled for August 15 and online bidding prior, say starting August 7, and whether or not the live auction can have a condition which states that, “Announcements made day of sale take precedence over any printed matter?”

When exactly is the day of sale? Is it August 15? If so, this would suggest that bidders may have already placed bids beginning as early as August 7 based upon the initial terms and conditions and then the terms might change on August 15.

The UCC 2-328 clearly denotes that each lot (item) of property is its own auction; therefore any items without any bids could have terms which change prior to the initial bid.

And further, certainly if the terms were changed after a bid was placed, those high bidders would have the right to retract from those contracts if the change was retroactive. And the UCC 2-328 allows for such withdrawal but would those bidders know of that right, or be present to enact that right?

In fact, a bidder bidding with terms inclusive that, for example, payment is due within 24 hours couldn’t be held to that contract if deemed the high bidder with payment due within 12 hours. The contract wouldn’t exist due to lack of mutual assent.

Or imagine a current high bidder at $500 with terms including a 10% buyer’s premium, and an auctioneer inviting a higher bid with only a 5% buyer’s premium. Similarly, we discussed treating all bidders the same here: https://mikebrandlyauctioneer.wordpress.com/2010/03/08/can-auctioneers-treat-bidders-differently/

Reserving the right to change the terms “day of sale,” should ideally be used to correct any advertising mistakes — and not used to bait with favorable terms and then switch to less favorable terms. I suspect most auctioneers include this disclaimer due to habit; it may be time to review such habits to see if this particular disclaimer is even necessary at all.

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. He serves as Adjunct Faculty at Hondros College of Business, Executive Director of The Ohio Auction School and Faculty at the Certified Auctioneers Institute held at Indiana University.