Given some auctioneers misrepresent property in online auctions, and the high bidder has recourse against that auctioneer for doing so, could the platform itself have some liability as well? I would submit only possibly, but maybe not.
First, most online auction platforms disclaim all responsibility for what auctioneers list on their sites, but could the platform be held responsible nonetheless if it knowingly, recklessly allowed property to be misrepresented on their platform?
The best strategy for any auction platform would be to include in their terms of use that auctioneers cannot misrepresent property. One such platform does: https://mikebrandlyauctioneer.wordpress.com/2023/10/23/magnificent-terms-and-conditions/.
As we’ve witnessed numerous times, disclaimers of this type only go so far as to protect the one disclaiming … such as disclaiming any responsibility for the health and safety of your bidders during a pandemic: https://mikebrandlyauctioneer.wordpress.com/2020/06/12/magical-auctioneer-disclaimers/.
For that matter, the foremost disclaimer found in the auction industry is a disclaimer of all expressed and implied warranties — with express warranty disclaimers largely unenforceable and implied warranty disclaimers unenforceable lacking an opportunity to preview.
Nonetheless, the most important considerations might be expense and time. Large auction platforms have lots of money, insurance, and attorneys at the ready. The subject property would have to be very material in nature to even consider litigation with the platform.
This is our environment not only in the auction industry but everywhere — as everyone seems to be disclaiming any responsibility for anything they do. My favorite restaurant disclaims responsibility for any steaks cooked “well done.” Of course, who would order a well-done ribeye?
We only need to look at the news to see that no matter what your “terms and conditions” say, it only matters how a judge and/or jury evaluates the circumstances. How did “no reasonable person would conclude that [my/her] statements were truly statements of fact” work out?
Puffing or sales talk has to be an obvious exaggeration that the recipient realizes is such. This is a “14K YG Diamond Ring” but I’m just kidding is not a recommended nor prudent defense. Now, if I say “If you buy this house with this kitchen, you’ll be a gourmet chef” you probably know I’m kidding.
Maybe the only thing most of these disclaimers do is “bluff” hoping the other party thinks the auctioneer, platform, or other entity is “not responsible.” I remember attending an auction buying a “working” typewriter, only to find out it didn’t work — but thinking the auctioneer sold it “as is” so I was out of luck.
Disclaimers aren’t going away any time soon, but as an auctioneer, you should know your disclaimers may not be enforceable– or serve as only a bluff — until a judge or jury says otherwise. Staying out of court is a good strategy: https://mikebrandlyauctioneer.wordpress.com/2018/07/26/auctioneers-you-want-win-in-court-or-stay-out-of-court/.
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, Brandly Real Estate & Auction, and formerly at 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 Auction Association’s Designation Academy and Western College of Auctioneering. He has served as faculty at the Certified Auctioneers Institute held at Indiana University and is approved by The Supreme Court of Ohio for attorney education.
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