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Answers to the most common questions can be found in my following articles:
Auctioneer Bidding… Is it Legal?
Auction House Bidding & Selling
Auctioneer/Seller Withdraws an Item with Bids. Is It Legal?
Of course, there are many other articles and I would like to encourage you to read them all.
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supreme court of washington udall vs t.e.escrow please look this up
[Admin note for clarification of reference: Udall vs. T.D. Escrow Services]
I’m not sure what your particular situation may be or the full scope of the questions you are asking. The details can often make a difference in the answer you may receive.
By the same token, this is also true in any court case. You might note that the case you cited was first ruled in favor of the seller and the court attempted to put everything back to the original position of the parties, as is somewhat normal under common law contracts.
As I note in the blog, I am not a lawyer and the answers are only opinions and certainly are not considered as legal advice. Of course, you can talk to two lawyers and also get two different opinions, just like you can get different outcomes from different courts.
One always has the right to take a matter to court and even appeal the decision if the decision doesn’t suit their interest. The outcome in either case can rest on various factors, from the attorneys in the case to the particular judge(s) hearing the case or even the State in which the suit is brought and other state laws that may affect the decision (the case you referred to was in the State of Washington, its Court of Appeals and its State Supreme Court). In addition, each case is tried on its own merits and the outcome in one situation may not be sustained in another, even in the same state. The only way to find out if your situation warrants the same outcome is to hire a lawyer and file a lawsuit, then hope for the best. Remember, these things take a lot of time, and a long time, and either side may also appeal any decision by the lower court, which may then be referred to the State Supreme Court and you get to go through it all, again and again. So, I hope the value of the property in question is worth the time and expense.
In your other question, you ask if you can also say that you “don’t want it” and get out of it. Again, you could also be taken to court to enforce the contract.
Typically, the higher the value of the property in question, increases the chances of a court battle. If you breach your contractual obligations for a small item in an auction, most auctioneers are probably not going to pursue the matter and only ban you from their auctions. However, some may still haul you into small claims court, just on the matter of principal, and they would have the legal right to so. In such cases, where the buyer is refusing to honor the contract, they will normally lose.
The matter you initially brought up is not the same thing, as it had several other factors in the scenario presented. The primary matter was based on whether the auctioneer had the authority to transfer the property, since you inferred that the contract with owner had other stipulations that prevented him/her from doing so.
The Udall court case you referenced, also had other factors that may or may not be similar in your case. You might note that the case was decided for, then against Udall on appeal, before it went before the Washington State Supreme Court. Sometimes, it just depends on the lawyers and the judges involved, combined with the particular factors and other details relevant to your particular case. Keep in mind, the “intent” of the law is often interpreted differently by different people.
It’s completely up to you, whether you feel that it’s worth the lengthy battle, attorney fees and court costs to fight the battle, which is the only way to find out the answer to your question, based on your particular situation.
As one that has been through the process (which I brought against the offending party) that took over a year and a half and finally agreed to settle through a Moderator, rather than continue the battle for many more months, I will think about it long and hard before considering such actions again. The aggravations of delays and disruptions in your life to fight such a battle should be considered strongly, as sometimes it may seem that you are the one that is defending yourself, even if you’re the one taking action against someone that was clearly wrong… then realize the outcome may not be as easy as it appears or even to your favor. After such an ordeal, you might think you’d have a better chance to take the money you still have and go try your luck in Las Vegas.
Good Luck
yes you are right thanks for your time
Do I need an an auction license to conduct an online auction of a piece of equipment that is located in St. Thomas, BVI? Steve
Actually, St Thomas is part of the U.S. Virgin Islands (USVI), not the British Virgin Islands (BVI).
It’s difficult to try keeping up with the fifty state laws in the U.S. However, while there doesn’t appear to be an auctioneer licensing board listed on their website, I would recommend contacting someone in the Virgin Islands regarding any specific laws that may pertain to any sort of business endeavors.
You can find the website at:
http://dlca.vi.gov/
A commerical business ha sbeen auctioned (ABSOLUTE). The buyer did not show up for the closing. There was no contact from the buyer before the closing. All were present .The attorney,sellers,auction personal. We waited. The buyers attorney did not contact anyone before hand. The buyer refuses to honorthe sale after 7 months. There has been no followup for the owner from either party other than to say we keep trying. How long do we the sellers have to wait for no response. THe money in escrow is in the auctioneers possession. I need advise. Thank you in advance.
The contract with the buyer should have set forth the terms, including the closing date, breach of contract, disposition of earnest money and all other details.
Since I haven’t read the contracts, which would include the Auction Contract between the seller and the auctioneer, Buyer’s Terms & Conditions and the Sales Contract between the seller and the winning bidder, I don’t know if all of those details were properly covered to determine your next course of action.
Now, I might ask why no one stayed in contact with the buyer. Who is the “we” that keeps trying and what are they trying to do? Since this was an auction, I certainly don’t understand why it has taken 7 months to get to closing. If the contracts were properly prepared, typically such transfers would be concluded within 30 days or less and if the buyer did not complete the transaction, they would lose the earnest money (who gets the earnest money should have also been spelled out in the contracts). In such cases, if the previous “back-up” bidder had been noted, they could be contacted to see if they were still interested and still possibly result in a sale.
I suspect that there may have been many issues that were not properly addressed.
The only advice I can offer is to talk to an attorney.
Hi. Good website. I’m hoping you can answer something that seems simple, yet I can’t seem to get a straight answer from anyone. I live in Oregon. Can I have an auction at my home, and act as auctioneer myself, as an alternative to having a yard sale? It occurred to me that 1) it would be a lot less work, 2) I could probably get rid of a lot more of the merchandise that I need to sell at one time instead of multiple days of sales, and 3) my experience has been that auctions bring higher dollar amounts than you can reasonably expect at yard sales or estate sales where each item is priced. Thanks for your help.
I had a similar question recently.
Please see my response:
http://auctionlaw.wordpress.com/questions-comments/comment-page-12/#comment-1674
In response to your basic question, there are no auctioneer licensing requirements in Oregon. However, you may need to check with your local government for any other requirements or restrictions.
In regard to the “less worK” comment, that is also why I directed you to my other response. There’s a whole lot more to a professionally run auction, than fast talk or just holding something in the air and asking for bids.
Is it legal for an auctioneer to have a lot bid up to an price and then add items to the lot and start bidding over for both items? which ends up freezing out the first bidder on the original lot and that price.
This is another one of the most common questions asked, which led me to post the article “Auctioneer/Seller Withdraws an Item with Bids. Is It Legal?”
The brief version is… There are two sentences in U.C.C. 2-328 that comprise the most likely answer to your question.
Paragraph (3) states, “Such a sale is with reserve unless the goods are in explicit terms put up without reserve. In an auction with reserve the auctioneer may withdraw the goods at any time until he announces completion of the sale.”
This means, unless the auction has been clearly stated to be an “Absolute” sale, the auctioneer may withdraw the goods at any time, prior to the call of “sold” (or other customary manner indicating the completion of sale).
A bid is not a contract. It is an “offer” that may be voided by a higher offer or withdrawal of goods by the Seller (or auctioneer), if the offer is deemed to be of insufficient value or retracted by the Bidder (as noted in the last sentence of U.C.C. 2-328, section 3). In other words, there is no contract formed, until the auctioneer declares “sold.”
Another common misunderstanding is that an item does not have to have a “minimum” (reserved price) to be “protected” under the U.C.C. and may still be withdrawn at any time, for any reason.
So, Yes, the auctioneer may withdraw the item and put it with something else, in an effort to generate competitive bidding and get the best price for the Seller’s goods… after all, that is the auctioneer’s job and why the Seller hired the auctioneer to sell their goods.
I recently used the services of an auction house that i also attend quite often as a buyer. I have following this auctioneer for several years and consigned with them once before about 3-4 yrs ago. Since then they have moved into a larger building. I took 3 or 4 trailer loads of my stuff to their building. It took them 2 different sale days to sell all that stuff (my opinion because they allow way to much stuff for each sale day) After the first auction I received my paperwork in the mail, I spoke with them and said that there were a few items i did not see. (I listed them specifically) Where were they? Their reply…”oh that must have got put in the back.” So before the 2nd sale day I expressed to them that i would really like ALL my items to be sold. Again, a few that for some reason got put in the back. A few weeks later i took 1 more trailer full to their building. At this time I specified to the auctioneer that this would be the last of what i would be selling and that this particular load was all good items Very few to be sold in lots. Most everything to be pieced out. and that I REALLY wanted it all sold so I would be done. I was planning to attend that sale but was unable to but I felt I could trust them. Now that I have received my peperwork from that sale, I am VERY VERY upset (angry) to say the least. There are numerous (and more) items that do not show on my sheets. Along with 38 lines that say “pallette” sold for $1. Meaning they piled a bunch of stuff on a pallette and sold the whole thing for $1. This auction house has 2-4 long rows of pallettes of stuff that they sell towards the end of each sale day. This again due to the fact hat they take in so much, it gets late in the day and they just start seling stuff in piles. The mistake i made was that i did not get a written consignment list of my items. And they never offered or reccomended that ither. Many MANY of the items that I and my paperwork doesnt account for were good money items. what can i do? I dont know if they didnt sell my stuff, or if they let all that high dollar stuff go on those $1 pallettes, or if they paid a different seller for my items. What i do know is the dollar amount of sales for that last auction of my stuff should have been atleast double what they gave me. Mind you i am not new to the auction scene. I have been an avid auction goer for many, many years and have been selling full time online for 10 years. Do I have any recourse?
Your recourse is probably minimal, unless you have a consignment list that the auctioneer accepted as an accounting of your items. At a minimum, the “higher dollar” items should have been listed as part of a written contract and agreed to be sold individually, if that was your wishes.
You indicated that you had specific items listed and I might assume that you gave this list to the auctioneer. You should have also kept a copy and at least, had it signed by the auctioneer indicating acknowledgment of acceptance. Since you did not indicate such, I assume this didn’t happen.
I might also add that such a list would not necessarily prevent the auctioneer from combining some items into lots (with lower value items), unless there was a contract specifically stating otherwise.
At this point, you probably can’t do much more than insist that the auctioneer provide an accounting for those items on your list. However, if such items were grouped together and not specifically noted, it’s also unlikely that the auctioneer will remember exactly how each item got sold.
Now, I seem to note a few contrary points in your comments, which raises other questions, as well.
As you indicate your familiarity with how this auctioneer sells the goods, I might also question why you took so much stuff at one time, with the expectation that it would all be sold in one day. Then you imply that the auctioneer allows “way too much stuff for each sale day.”
I may question how you came to the conclusion that your goods should have sold for double, than what you received. Even if some of the “high dollar” stuff was combined with other items (on a pallet or otherwise), people would have still bid more than a dollar on such high dollar items. In fact, this is why auctioneers may sometimes combine some “lower value” items with something else (or group the lower value items together), in an effort to get everything sold and removed.
While there may not be as many bidders at the end of the auction, some things may sell for less than expected, as they may not have the right bidders present. This is also why many of those stay until the end, hoping to get a good deal. However, since you indicate that you’re familiar with auctions, you probably already know that.
I could tell you everything that you “should have done” and the red flags that you should have looked for, but it’s not likely to do much good, after the fact. Of course, you have already indicated that you know many of the things that you “should have done.”
One should always have a written contract that spells out everything, prior to turning over your assets. Without a written contract, you are left to your own interpretation of expectations and they may not be the same interpretation that the other party thinks is understood.
If the reserve is lifted on house auction and they were accepting bidds in $5,000.00 amounts i was high bid at $85,000.00 the other bidder went up $2,500 TO 87,500.00 thus changing the bid amount.
I wanted to go to $88,000.00 without asking the seller-they turned my bid down &and wanted me to go up $1,500.00-saying it wouldn’t be fair for to the other bidder for at $500.00 increase–thus losing at least a higher bid?????
Unless the auction is advertised as Absolute, the auctioneer has the right to refuse any and all bids (no, he doesn’t need the seller’s permission to refuse a bid).
There are many reasons for an auctioneer to refuse a bid. One is to keep things moving in an efficient manner and when someone starts trying to low-ball the bids, it just slows things down. Considering the auctioneer accepted a “cut-bid” and reduced the increments from $5000 to $2750, a $500 bid is definitely a low-ball bid. After all, another $500 isn’t much of an offer and may not be considered fair to the other bidder(s) that were offering more reasonable bids. Next thing you know, another bidder would offer $100, with a counter bid of $25 and then $5… If it’s not worth the bid the auctioneer is asking, then it has probably reached its limit and it’s time to close the sale.
Keep in mind, while the auctioneer is trying to get the best price for the seller, they also have to balance that with treating all the bidders fairly. To cut the bid in half (at a point) is one thing, but to offer less than 20% of the current bid is not fair to the other bidders. It was more than equitable for the auctioneer to offer you a counter-bid of $1500.
Is it legal to serve alcohol to auction participants? I was told that is was illegal to serve alcohol (give away, sell), there was not to be any accessible alcohol present. It was an auction for a bar in the state of Wisconsin. I have searched extensively and not found the answer.
Such things would be determined by your own state laws regarding the serving of alcohol and nothing to do with the actual conducting of an auction.
It is probably illegal to sell alcohol unless you have a permit. For a business to give away alcohol may fall into a gray area and this is where your state laws would be the determining factor.
Of course, there is often alcohol at fundraising events and it is usually served under special guidelines that may allow for such functions.
You may want to check with an attorney on how your state laws address the issue.
I purchased a bundled lot of items from a closing business, auctioned by a local large, reputable auction house on an online-only auction.
The lot description did not contain precise item descriptions, but the picture clearly indicated what was included. I inspected the lot onsite before the auction and verified that the items were there. After I won the high bid on the lot (for $55), I arrived onsite (during the stated removal time period) and found 2 valuable items (worth $1300) had been removed from the lot.
From my observation, the auction company had a few staff members wandering around, but people were walking out every door of the building, largely unmonitored.
The auction house offered to refund my purchase price ($55), but this is not even close to the $1300 value of the items. Since the auction terms state “Once an item is announced as sold, you are the owner and are responsible for it.”, it was MY $1300 item that was stolen.
It may be that I could file a claim under MY homeowners insurance for the loss, but I have a $500 deductible.
I have to questions:
1) What is the responsibility of the auction company to secure my property following the close of the online auction, but prior to my showing up to collect the items?
2) Since my property was under their care (as manager of the facility) are they responsible for paying for my loss?
I think you already answered your own question, as you indicate that the terms state “Once an item is announced as sold, you are the owner and are responsible for it.”
These are some of the problems with the online auctions and whether such terms can be met, as such terminology is usually reserved for those present, who have the ability to watch their items.
So, there is no clear-cut answer to that part of your question and the only way to get an answer may be through the courts.
Now, regarding the other issues you brought up (and I’ve discussed before and even wrote about on this blog), you may not find to be reasonable assumptions.
First, you can not claim your loss through your homeowners insurance. You can ask, but you will be disappointed with the answer.
The other part is that it doesn’t matter what the presumed value of the items may be, so you can’t claim that you lost more than you paid. You didn’t lose $1300, since you didn’t pay $1300.
If the items were worth $1300, then it’s unlikely that they would have sold for $55. The most you could claim to have lost is your $55, even if there was something missed by others and you stood to make a windfall profit.
So, you can take the matter to court, regarding the “security responsibility” for your goods. However, should you win, you are not likely to get more than the $55 you paid for the items.
If the auctioneer offered you a refund for your purchase, that is about all you’re going to end up with, even if you took the matter to court.
I have no idea if the auctioneer had a permit but the bar itself was licensed. The person who got the bid had been drinking all morning, but he was not held to the purchase. I was told it was a state law, and alcohol could not be served or available even if it was in the course of ordinary business. I thought maybe there was a rule that would apply within the auction rules.
While it may be possible alcohol is not permitted in your state at an auction, I doubt it. The situation that occurred in this case relates to contract law. A contract between someone of legal capacity and someone of limited capacity is voidable. I have had to inform people I would no longer take their bids as they were impaired. It creates a problem when the person of limited capacity chooses to withdraw. The same is true with a minor bidding at auction.
Gwyn makes a good point. However, I went ahead and searched through Wisconsin law, utilizing all sorts of various words and terms that might be relevant.
My results:
I could not find anything that implied this was illegal, regardless of auction law, contract law or the sale or distribution of alcohol (intoxicants, etc.) and how any of these might relate to legal contracts or competency, regardless of the type of business.
I will note that it does appear to be a violation of law if the auctioneer is intoxicated!
You can search the state laws at: http://legis.wisconsin.gov/rsb/
Is the consignee can bid his own items?
Is it lawfull that the consignee is not allowed to consign at all because he bids his own items?
Eva, I’ve posted a couple of articles in this blog that should answer your questions.
Auction House Bidding & Selling
Auctioneer Bidding… Is it Legal?