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I’m one of only a few people around the United States who has the immense responsibility to teach auctioneers how to bid call — when they have never bid called before. We discuss the very basics which is the auctioneer accepts a bid (the have) and then suggests a higher bid (the want) until either the want becomes the new have, or there are no further bids …
We touched on another unfortunate bid calling technique (https://mikebrandlyauctioneer.wordpress.com/2018/01/29/i-have-it-but-i-dont-and-then-again-again-again/) in a prior treatise which likely violates federal law. The basics of this scheme are that the “have” is contingent upon receiving the “want.” If the want is not received, the have is retracted.
As we noted, retraction of a bid is provided by state law in the United States but retraction requires a “change in mind” or a “change in thinking.” For example, someone bids $1,000 and then realizes he didn’t want to bid $1,000 and retracts his bid. Not, “He bids $1,000 and because nobody would bid $1,100 he retracts his bid.“
Said another way, bids have to contain a “genuine intent to purchase at that price,” or as allowed in a with reserve auction, protect sellers from bids below their minimums where the seller essentially buys at $1,000. Thus, in our $1,000 example above, an auctioneer could bid $1,000 for the seller [with disclosure] and then no-sale the property for want of a further offer.
Otherwise, portraying that there is a $1,000 bid — when there is not — hoping someone will bid $1,100 and retracting this bid if no further bids are made is, at minimum, misrepresentation with an intent to deceive, and likely bid rigging and constituting fictitious bidding.
A common argument countering our premise here is … bidders choose to bid (or not to bid) so this prior contingent bid is largely irrelevant. However, bidding at an auction is collaberative by nature, as we explored here: https://mikebrandlyauctioneer.wordpress.com/2017/04/01/but-the-bidders-chose-to-bid-again/
Relatedly, we noted that saying, “Sold!” when the property is not transferring to a new owner may as well be misrepresentation: https://mikebrandlyauctioneer.wordpress.com/2015/04/29/can-an-auctioneer-say-sold-and-not-mean-it/
My point in all this? Besides all the legal liability, in ethics polls year after year (CNN, USA Today, Gallup) occupations like auctioneers rank near the bottom (low barrier to entry, commission/sales based, little or no education required.) Some auctioneers wonder if their standing can be restored or mended?
Unfortunately other than the intrinsic characteristics of our profession, another issue with perception is undoubtedly some auctioneers saying they have a bid when they [really] don’t — lying about it — furthering a feeling bidders can’t believe what auctioneers are saying … can’t rely on their representations … and as such are dishonest and/or unethical?
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, an Instructor at the National Auctioneers Association’s Designation Academy and Texas Auction Academy. He is faculty at the Certified Auctioneers Institute held at Indiana University and is approved by the The Supreme Court of Ohio for attorney education.