Auction houses and the net

[scot1974]

Hello
your opinions please
I have another Q on here which relates to this one, as i bought an item which was not as described and found apparently their is little i can do about it in law

What i have recently found out here in the UK is that here we have a system of buying at auction which hasnt changed since Victoria was in nappies and nothing to do with a spice girl, we have a 19th century law running alongside 21st century technologie which cant last its like the old days of buying a 2nd hand car with 1 careful owner but the other 6 weren't, we didn't mention that guv cause that's for you to find out 

Basically the auction house acts as a go between a springboard between the vendor and the buyer and they take a commission as their wage
and they advertise the piece in a catalogue with a description which they have written BUT that's only their "opinion" and to be absolutely sure one should inspect the piece themselves,...this was called Buyer Beware Rule all auction sites will have this in their terms and conditions, well that was fine in the days of gas lighters and horse droppings but it still applies today even though the auctions have been global for several years now.

So if i buy from a auction house in Aberdeen and im in London and as i cannot inspect the piece personally i have no other choice but to believe what the auctioneer has written which apparently has no course in law as its only his "opinion" and further if there is a problem then i have to take it up with the original owner of the piece as the auctions only a springboard between us.

There are many new laws about buying at distance and fit for purpose specifically designed for buying online but when its at a auction we go back to Queen Victoria and her laws. If auction houses are to continue selling then they should be responsible for the description they give as we cannot view the item and the old Buyer Beware has no place in todays business.

I know the auctions are busy places and some houses sell many items and a precise report on all would be very time consuming so perhaps it has to be for items over a certain price or for items of value such as gold antiques etc  there is of course the specific request for a "condition report" on an item which most houses give with pics etc but again it is only their opinion it also holds no weight in law.

Or am i wrong?

 

[mart]

Well, as I see it,,the first thing you need to do is to make sure you are educated about the item you are buying !! When you ask for a condition report,,specify what you want to know and give enough time for the auction to do it !!  The auction house can only go by what they can see and may be totally unaware of problems !! Not always is the most qualified person in charge of looking at the item !! Nor will some know what to look for !! Because you communicate with the person you assume did the evaluation,,in fact they may have told an assistant to go look !! 
If you ask a direct question, then it is clearly not as described or told to you,,you should have some recourse !!
And you should always look for complaints against the auction and how it was handled by the management !! Too many unsatisfactory purchases would tell you to look for another place to buy !!
Even if buying over the internet from a reputable auction,,things can still go wrong !! Read their policy on internet sales carefully !!
And the old rule of Buyer Beware still applies in the UK and in the U.S and most other places !!  In my opinion Ebay is the best place for the purchase of small items !! They have a feedback system that you can check to see how reputable the seller is !!  Have not had a problem there !! Most sellers go over and above what is necessary !!

[Ipcress]

I'll just say you're right and you're wrong. There are rules and regs but auction houses have their own and you must read them in their catalogue, saleroom or website

Can't type at more length because i'm busy but just wanted to register my interest so you don't think people are ignoring you !

I'll post more later / tomorrow.

This might be worth a read

http://www.antiquestradegazette.com/essential-info/auction-guide/

[gg27]

Myself & most other dealers I would think, get rid of their least desirable stock at auction, sometimes I have to buy everything at a house but some pieces have serious problems which I don't want to stand behind.  I can send them to auction so there is no responsibility as far as age or condition, it's "as is, where is"   
I usually don't bother doing anything to the pieces, but I know many dealers who will fix up a piece just enough to make it look nice but the reality is another matter. 
Buying at auction has always been buyer beware.  If you want a guarantee you must buy from a reputable dealer who will put down on your receipt what the item is, when etc & you will have some recourse.
The auction house does not own the piece, so they can't have any responsibility other than what they can quickly see or have been told from the owner.   Hope this helps, although it is after the fact, & that hurts.  GG

[mart]

We can`t read it Rauville !!  Members only !!

[Rauville]

We can`t read it Rauville !!  Members only !!

Better?

The following is an article that appeared in the Maine Antique Digest, written by an "Auctioneer-Attorney" that brings up some interesting points.

by Steve Proffitt

Q I have a question concerning auctions that allow bidding over the Internet, by telephone, and by absentee bid. Many auctioneers use terms that are totally inconsistent with these forms of bidding. For example, one auction house states: "Everything will be sold as is, where is, with all existing faults, and there are no warranties or representations made, either expressed or implied." Another auction house's terms on this subject state: "Lots will be sold as is, with all defects and imperfections, and no warranties or representations will be made. The auction house and its agents and employees are not responsible for any defect, error, imperfection, or problem with any lot, nor for any statement made." I e-mailed this second house and was told that this is just "standard policy" and that the house stands behind what it sells. I feel this assurance is worthless because it contradicts the explicit terms given for the auction and because the house has even declared it is not responsible for statements made by its employees. What is an Internet, telephone, or absentee bidder supposed to rely upon in order to bid with such broad, sweeping disclaimers in place? Disclaimers like these make the descriptions given of the items worthless. If these auction houses are not responsible for their own descriptions, who should be? If there is another trade anywhere where professionals are able to absolve themselves from any and all responsibility for their work, I would like to know what it is. Can you imagine your plumber, auto mechanic, or doctor having a policy that relieves them of all liability for what they do?

A This is a great letter. It raises interesting points and asks some good questions. Let's start by understanding the origin and purpose of auction disclaimers.

-Schools and Copycats

The letter writer provides two examples of disclaimers given by auction houses. Look at how similar they are. All auction-goers have seen the same type of disclaimers in auctions of every size, type, and location. Did you ever wonder why all auctioneers use just about the same disclaimers to deny liability? The answer is twofold.

First, auctioneers use these disclaimers because this is the first thing they are taught in auction school. Every student called on to sell an item is made to run through something like this: "Everything today is being sold as is and where is with no representations or warranties of any kind, either expressed or implied." A disclaimer of liability is drilled in so much that it becomes second nature with auctioneers in training.

Second, all auctioneers use disclaimers of liability because all auctioneers use disclaimers of liability. That's right—there is validation for the practice in the volume of the practitioners who do it. This is copycatting, but it's smart copycatting. Sometimes you'll hear an experienced auctioneer with a flair for humor spice the "as is" disclaimer with something like this at the end: "You take it like your wife, for better or worse. If you buy it and it falls into ten pieces, you own all ten pieces."

-Litigious Society

You can't blame auctioneers for trying to disavow liability wherever and however they might, because there is no shortage of claims and litigation in modern commerce. This explains why I recently read an article in which the writer stated that economic growth in this country was largely built on two big moneymakers: our selling houses to each other and suing each other.

While this anecdote may be exaggerated, it has a ring of truth. The sad fact is that we do have many claimants advancing and looking to advance many claims. Some of these claims are justified, but many are spurious. This is why any wrong, real or perceived, may be enough for some people to pull the trigger that causes a lawyer to knock on someone's door. No one wants that "visit," and that's why auctioneers are quick to use disclaimers to try to ward off risk before a claim strikes.

-Disclaimers

Just what do auctioneers want to disclaim? I deal a lot with disclaimers, so let me answer that from my own perspective. I want to disclaim whatever can be disclaimed. I want to place the obligation squarely on the bidders and buyers to conduct their own due diligence, at their own risk, of everything—the property, the auction, its terms, the contracts for sale, the marketing materials, auction documents, and all else related in any way to the marketing and selling processes.

I have three primary goals in using disclaimers. First, I want to take any duty that I can off our seller and our company and place the heaviest legal burden that I can on bidders and buyers to be responsible for themselves. Second, I want to advertise that fact to the bidders and buyers to persuade them to fulfill their duties and dissuade them from thinking they might succeed with a claim against the seller or our company. Third, if a legal claim ever arises, I want an arbitrator, court, or jury to have the legal ammunition necessary to rule on behalf of our seller and our company and against the claimant.

-Maybe Not

I am the handsomest man in the world (I do have seven children, for whatever that's worth). If you saw me, however, a few of you might somehow conclude that I am not the handsomest man on the planet. The point is, just because I wrote that first statement doesn't make it so—and that rule holds true for much that is said in commercial dealings. Far more is stated than is true.

This rule certainly applies to disclaimers. When an auctioneer disclaims something, the disclaimer may hold water, or it may not. With the disclaimers described by the letter writer, the answer is the latter. These disclaimers do not achieve the broad, all-inclusive result that the letter writer (and maybe the auction house too) thinks they do. I'll explain.

-Not Bulletproof

When I teach seminars on commercial law to auctioneers, I regularly ask for a show of hands of those who use the "as is" disclaimer to avoid making any warranties. Predictably, every hand will be raised. When I follow that question by asking who believes this disclaimer prevents any warranties from being made, the result is equally predictable—no hand will be raised. I then ask why auctioneers use a disclaimer they don't believe works. By then, the audience is so surprised by their collective confusion on the point that no one ever answers that question. This is a serious problem, because it reveals an Achilles heel in the practice that auctioneers use. Anyone who follows a practice or procedure without understanding its purpose, effect, and limitations will eventually make a mistake, and auctioneers regularly make mistakes in using disclaimers in ways that don't work.

You've heard the old chestnut, "You can't have your cake and eat it too." An auctioneer can't wrap himself in a disclaimer and expect it to be bulletproof against subsequent representations of material facts that he makes about what he's selling. This is black-letter commercial law. When a seller gives a disclaimer and follows that with a description of the goods, a warranty of description arises. If that warranty conflicts with the disclaimer, the warranty will prevail. So an auctioneer can make a disclaimer, but that doesn't mean it's effective.

-Warranties

The law permits auctioneers to sell under an "as is" disclaimer and to disclaim all warranties either expressed or implied. Every auctioneer I have seen, however, quickly steps from behind this shield and makes representations that create warranties for which the auctioneer and his sellers are responsible. Here are the three most common warranties made in auctions, as provided for in the commercial code:
•There is an implied warranty that the title to the goods conveyed by the seller shall be good and the transfer to the buyer rightful.
•There is an implied warranty that the seller shall deliver the goods free from any security interest or other lien or encumbrance of which the buyer has no knowledge.
•The auctioneer's description of the goods becomes an expressed warranty that the goods shall conform to the description.

In addition to this rule in commercial law about creating warranties of description, an auctioneer's errant description of a lot can also result in a claim founded upon either actual or constructive fraud.

To avoid creating these three warranties, this is how an auctioneer would have to introduce a lot: "Folks, I don't know what it is. I don't know who the rightful owner is. I don't know if I can lawfully sell it. I don't know if you can lawfully buy it. I don't know if it's encumbered by some claim, lien, or security interest. I don't know if I'm authorized to deliver possession of it to you. I don't know if you can lawfully own it. How many dollars will you give for it?"

Have you ever heard an auctioneer say anything like that in an auction? You haven't, and neither have I—and we never will, which is why all auction lots carry at least these three warranties. Consequently, I don't agree with the letter writer that auctioneers' descriptions of the goods are without value. I also wouldn't agree with an auctioneer who thought such descriptions could be made with impunity and without potential liability.

-Conclusion

There are lessons here for two groups.

First, auctioneers should know that the "as is" disclaimer is not bulletproof. They should also know about the three warranties that will arise with every lot they offer. As a result, they should carefully guard what representations they make-particularly with regard to lot descriptions.

Second, bidders should always conduct their own due diligence about everything. Those who intend to make remote bids on valuable lots need to find a way to have a competent and independent inspection made of the goods, lest they risk relying upon a description that may be unreliable. Bidders should likewise carefully research auctioneers to determine which ones will stand behind what they sell and which ones will not. No matter what liability might attach to an auctioneer, enforcing performance can be a significant challenge and cost that is best avoided where possible. Caveat emptor has been sound advice for centuries and remains so today.

That's it for now, but I'll see you again in the November issue of M.A.D. Until then, good bidding.


--------------------------------------------------------------------------------

Steve Proffitt is general counsel of J. P. King Auction Company, Inc. in Gadsden, Alabama. He is also an auctioneer and instructor at the Reppert School of Auctioneering in Auburn, Indiana, and at the Mendenhall School of Auctioneering in High Point, North Carolina. The information in this column does not represent legal advice or the formation of an attorney-client relationship. Readers should seek the advice of their own attorneys on all legal issues. Mr. Proffitt may be contacted by e-mail at <sproffitt@jpking.com>.

[mart]

Excellent article, Rauville !!

[scot1974]

What I would like to change and bring into the 21st century is the system of "buyer beware" and auctioneers exemption.

Simply this, they CAN continue with the antiquated "buyer beware" if the sale is NOT advertised online,
BUT cannot hide behind this Antiquated Law when selling online.

As I cannot be at the place of sale and therefore view the item, it is reasonable that a true and just description be made available to potential buyers without having to ask "for the real truth" condition report.

Many industries have gone to the wall with progression, i.e. modernise or go bust, and to me this one is not just glaringly obvious but also unjust so either stop advertising online or give a full description of the item and be prepared to stand behind it.

[bigwull]

there,s always ebay...great protection for buyers...9 out of 10 cases where there is a dispute over a sale...ebay will find for the buyer...they protect buyers...as for the other auction houses...great places, they,ve been good to me, lots of good deals, and a hands on before you bid....but if i end up buying something that is,nt right, our local auction house will give a refund...without question....no antiquated law there....the crux of the whole matter is..if you don,t tust these online auctions, and you don,t like ebay...don,t bid,..its as simple as that...

[mart]

If it were me,, I would educate myself rather than spend the energy to change the rest of the world !!  Its a lot easier !!  You had a bad experience with one auction house,,don`t buy from them again !!  There are plenty of others !!  You cannot lump all of them together !! To change the entire system for one doesn`t make much sense !!  If they lose enough business they will get it together !!

[bigwull]

In my area Taylors Auction House is the biggest,...and i can say from experience, that...their refund policy is good,..when a vendor puts an item up for sale, they,the auction house hold on to the money for 3 weeks,..this is to allow any buyer who feels they have been missold an item..time to raise a concern,....I have also on occasion,..bid and won...an item...only to find that i,d made a mistake,and it was the wrong item...and when i pointed this out ..they waived the sale,...