Deception is generally held as an act or statement which misleads. It might involve propaganda, distraction, camouflage, or concealment. Most consider deception — in its basic form — lying with the intent to deceive.
Actually lying can be an intentional expressed misrepresentation or constructive misrepresentation which involves ommissions or concealment. In other words, there can be consequences for expressing false information with the intent to deceive and/or not expressing information that has the same intent.
We sell cars at auction — I’ve sold well over 100,000 cars in my career and continue to sell cars at auction here in 2020. We disclose if the cars run and/or move, and also if there are any other more latent problems — oil leaks, transmission leaks, unusual sounds, mileage discrepancies, error codes, etc.
We also allow plenty of time for buyers to inspect cars before and the day of the auction. We want those bidders to be completely informed about their prospective purchases before they bid and we want them to attend and participate in our auctions in the future.
Not that long ago I attended another auctioneer’s car auction and heard nor saw any such disclosures. Cars were sold by “year-make-model” and off they went … car after car was sold and then driven (or pushed) to a holding area. One such car was sold and pushed away from the auction area and parked near where I was standing.
The buyer of this particular car came to the office a short time later complaining that the car didn’t run, and had transmission issues as well. The auctioneer said (and I quote) “Well, it’s not like we lied to you … you bought the car “as is.” Maybe the oldest phrase in the auction business meant to relieve the auctioneer/seller of any liability.
Our question today involves if indeed the auctioneer, auction company, seller or somebody else involved with this auction did lie? In this case, possibly constructively misrepresenting the [poor] condition of the car by omission — not by expressing a lie, but by not saying anything.
Indeed, if the auctioneer/auction company and/or seller knew this car didn’t run and had transmission problems (shouldn’t they know?) and didn’t disclose it, there’s little doubt the reason was they wanted the bidders to believe it did run and had a sound transmission — hoping to deceive the bidders.
The lesson here is this buyer did feel deceived regardless and won’t be attending this other auction ever again. In fact, I know that because he told me as he arrived at one of our car auction previews: “I won’t be buying there anymore, but you guys always treat me right and disclose stuff.” I reminded him we disclose all we can, and he’s previewing which is prudent.
Auctioneers should be cognizant that intentional expressed deception is a terrible idea and omission or concealment of important (material) facts can be just as bad. It’s bad for your buyers, sellers, and it’s bad for your reputation as well. Further, it can cost you time and money in court away from your auction business because deception often prompts litigation.
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, and an Instructor at the National Auctioneers Association’s Designation Academy He is faculty at the Certified Auctioneers Institute held at Indiana University and is approved by The Supreme Court of Ohio for attorney education.