Everyone is “sue-happy?” Sure, that the entire problem; so auctioneers need disclaimers, waivers and assignments … and insurance.
Of course, what do some insurance companies do when a claim is filed? Deny coverage, attempt to limit their liability, and possibly argue someone else (probably you and not they) are actually responsible.
Attorneys look for work no different than auctioneers or anyone else — and who can blame them? If someone’s got a claim, it’s not difficult to find an attorney to take a shot at winning and nonetheless earn some income regardless.
Let’s analyze the players here:
- Auctioneer with insurance gets sued and wants to limit his or her exposure.
- Defendant will desire to maximize his or her reward.
- The insurance company will work to limit its current and future liability.
- Plaintiff’s attorney will work to be paid.
- Auctioneer/Insurance attorney will work to be paid.
So, your paperwork (contracts, terms/conditions) have page after page after page of disclaimers, waivers, and assignments to limit your exposure? In our example here, it’s actually more to limit your insurance company’s exposure.
In other words, the auctioneer pays the insurance company premium regardless but has to help them avoid claims. Of course, auctioneers risk losing insurance coverage if they are responsible for large or frequent insurance claims and/or payouts.
There are actually two ways auctioneers can help their insurance companies avoid claims — one is disclaimers, waivers and assignments and the other is to behave better. The latter seems to escape many auctioneers around the United States.
However, is it all sue-happy people pursuing completely innocent auctioneers? It’s far from that. As we’ve previously noted, tort cases only involve about 3.5% of all civil filings in the United States, and of that, about 30% of those cases are businesses suing other businesses.
Yes, there are frivolous lawsuits, but I can assure you there are many claims with overwhelming merit. Let’s see … have you possibly heard of any auctioneers …
- Running the bid (taking fictitious bids) on bidders?
- Selling “as-is” and then expressly misrepresenting property?
- Not following the contract?
- Putting their interests ahead of their clients?
- Engaging in bait and switch schemes?
It is abundantly clear that auctioneers wouldn’t have to — for example — disclaim everything they say if they just simply endeavored to tell the truth. We’ve seen many auctioneers recite their waivers word-for-word while telling us their bidders, “don’t read anything …”
Here’s what I’ve noted as a pattern of behavior as an expert witness in dozens of $1 Million-plus lawsuits. Once the disclaimers, waivers, and/or assignments are all in place, the auctioneer conduct then seems to move to “I can do anything” because of it.
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.