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Auction terms and conditions are important. They prescribe the rights and duties of the auctioneer and the bidders — or if you prefer, “allocate risks.” One such term/condition that can be in yours is noted below:
After a bidder has won the bid with his (or her) high bid, he has become the new owner of the item, even though he may not have paid for the item yet.
I’m pretty sure I know what “won” means, but in this context I suspect it means the auctioneer said, “Sold!” “Won” is even more empowering and is a nice way of saying the buyer is now enriched with the subject item at his offered price. Further, this term/condition suggests he’s now the owner even if he hasn’t paid for his purchase yet.
However, other terms and conditions might contain some statement like, “Auctioneer reserves the right to reopen, void, regroup, modify … at his sole discretion” So in other words, “Congratulations — you’re the owner,” but you’re not?
I can assure every auctioneer on earth — this is what irritates auction bidders (buyers) more than anything else — telling a buyer they have WON! and then one second later, five seconds later, an hour later, a week later, a month later telling this same buyer that he didn’t win. How would you feel? Right.
Let’s say you are telling the person who had the winning ticket to the $460 million lottery that she WON, only to tell her subsequent she didn’t win anything because this other person didn’t get in line at the convenient store soon enough to buy his ticket … or lost his ticket … or picked the wrong numbers … or simply forgot about the lottery altogether.
But … but … but, “That bidder that ‘thought he was on’ or ‘bid too late’ is irritated. I have to do something for him …?” I’m sure he’s despondent but here’s my advice: Tell him to bid more overtly and/or quicker next time; in other words, “help yourself,” and maybe buy him a cup of coffee or something … even though this might have meant a bit more in proceeds for your client, it subjects your principal to needless litigation.
If you are one of those auctioneers who feels it’s prudent to reopen the bid for just about any reason, then we recommend you not use the aforementioned clause in your terms and conditions — despite it, “making your life easier by limiting risk of loss by passing title sooner rather than later.”
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.