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writing-1149962_1920We have written before about auction terms and conditions (T&C’s.)

Terms such as this often include that “buyer’s must register,” “everything is being sold ‘as-is,'” and “payment is due at a certain time.”

Auction terms and conditions also include many other things depending upon the type of auction and/or what particular property is being sold.

Our topic today involves if these “terms and conditions” are only (solely, exclusively) for the seller’s protection. While the seller/auctioneer drafts these terms, we would suggest they are not only for the seller.

Auctions require sellers and bidders (buyers.) Without either, there is no auction. A seller/auctioneer who writes terms and conditions only for their protection will have only sellers, and few if any bidders (buyers.)

We addressed this issue in part back in August, 2016 talking about auctioneers making the terms completely one-sided — exclusively seller favorable: https://mikebrandlyauctioneer.wordpress.com/2016/08/01/an-auction-where-21/

In fact, the courts have commented on exclusively seller favorable terms and conditions (adhesionary terms and conditions,) namely the Louisiana Supreme Court: http://www.keanmiller.com/files/supreme_court_arb_agreements.pdf

First, let’s establish that by registering for an auction, the bidder and auctioneer (on behalf of the seller) enter into a contract. That contract essentially involves the bidder’s right to participate in return for accepting the terms and conditions.

Again, naturally, since auctioneers/sellers write these terms and conditions, they tend to be seller favorable, but not completely so. Actually, some auction terms protect both the seller and buyer; for example:

  • Terms which say that “Sales tax will be collected” only protect the seller? Isn’t the collection of sales tax mutually beneficial to both seller and buyer?
  • Terms which say “Title to vehicles will be provided to buyers within 30 days” only protect the seller? Isn’t this actually forcing the seller to get the title to the buyer on schedule?
  • Terms which say that “A lot that is grossly misdescribed can be returned within 5 days of purchase for a full refund” only protect the seller? Seems this favors the buyer over the seller.
  • Terms which say that “Seller to provide marketable title, and prorate taxes through day of closing” only protect the seller? Obviously, this is for the buyer’s protection.
  • Terms which say, “The property is selling absolute to the highest bidder” only protect the seller? Essentially, the seller is guaranteeing to sell the property …

Auctioneer/seller auction terms and conditions continue to evolve, and certainly they are seller favorable — but are they solely for the seller’s protection? Not hardly.

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, RES Auction Services and Goodwill Columbus Car Auction. He serves as Distinguished Faculty at Hondros College of Business, Executive Director of The Ohio Auction School and Faculty at the Certified Auctioneers Institute held at Indiana University.