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I’m being told that countless auctioneers across the country contract with sellers to sell everything “without reserve” a.k.a. “absolute” and then don’t. In other words, an absolute auction is not advertised as absolute so the public believes it is “with reserve” or more importantly they don’t believe it’s “absolute.”

First of all — why would any auctioneer not want the public to know an auction is indeed absolute? The words “absolute” or “without reserve” drive more bidders to the auction and thus result higher prices. Secondly, if an auction is contracted with the seller to be absolute, then those lots are in explicit terms put up without reserve as explicitly denoted in that contract.

In fact, if a seller directs in the contract with an auctioneer to sell his property (lots) absolute, then not following that direction would constitute a breach of contract. I suppose those who argue counter to that would also suggest a seller directing lots to be sold “with reserve” could actually be represented as selling “absolute?”

One might contend that despite explicitly stated in the contract as absolute, that the property has not yet been “put up” for sale in that manner. We wrote about this in 2014: https://mikebrandlyauctioneer.wordpress.com/2014/12/15/when-is-an-absolute-auction-an-absolute-auction/. Yet, we ask again … how did the seller direct his property to be put up?

As someone who frequently works as an expert witness in auction-related cases around the United States — auctioneers are advised to remember that all your paperwork (contract, terms and conditions, bidder registration, advertising, etc.) are routinely subpoenaed by the opposing legal team. Conducting an auction (or representing an auction) counter to the contract with the seller would clearly be good news for the other side.

A quick example: Seller and auctioneer agree to sell everything absolute. However, auction is [purposely] not advertised as such and bids are placed (within a reasonable time.) Then, the seller/auctioneer wish to withdraw lots from this auction … and do. Disgruntled bidders seek damages and discover auction was contracted as absolute.

I wouldn’t wish this above situation on any auctioneer. Rather, here’s what we as auctioneers need to do: Advertise and conduct “absolute” auctions as such, and advertise and conduct “with reserve” auctions as such. Any other plan is ill-advised.

Mike Brandly, Auctioneer, CAI, CAS, 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, Executive Director of The Ohio Auction School, an Instructor at the National Auctioneers Association’s Designation Academy and America’s 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.