Is it okay to drive 70 miles per hour in a 70 miles per hour zone? Generally, yes, unless circumstances dictate a slower speed — for instance — emergency vehicles are passing you. Is it okay to drive 95 miles per hour in a 70 miles per hour zone? Here generally, no, unless the circumstances dictate otherwise — for instance, an emergency vehicle is chasing a potential criminal.
We have previously suggested that following the UCC § 2-328 rather than your own version of it is prudent. For instance, this 254-word treatise says you can reopen the bid if a bid comes in “while the hammer is falling in acceptance of a prior bid the auctioneer.” Yet, you have terms that say, “Auctioneer may reopen, void, cancel, or otherwise ignore any bid at any time …”
Let’s say a bidder is not satisfied with how she’s treated in this regard and files suit. Her attorney might argue that your terms which say a bid can be voided capriciously at any time do not represent “good faith, diligence, reasonableness, and care.” What are the issues here? One, you’re in court, and two, a judge or jury might agree.
Or, let’s say this same bidder is not satisfied with you following the textual letter of the law and files suit. Her attorney likely advises her (outside of filing a frivolous lawsuit) that she has no case — the auctioneer was following state law, and her complaint isn’t with the auctioneer, and rather largely with the state legislature.
Similarly, we suggested several years ago following engagement in dozens of auction litigation cases, that there didn’t appear to be any disadvantage of following the UCC § 2-328 strictly: https://mikebrandlyauctioneer.wordpress.com/2018/08/01/when-has-the-ucc-2-328-been-a-bad-idea/. Yet, the message otherwise has been that you should write your own terms and conditions independent of this treatise — which we’ve advised is not prudent, but nonetheless …
Importantly, this “write your own” movement usually suggests some sort of disclaimer, waiver, and/or assignment that the bidder agrees to these customized (and thus possibly unconscionable) terms and conditions. Yet, what is possibly not obvious, you can’t waive nor assign your duty to act with “good faith, diligence, reasonableness, and care.”
The overall standard for this customization is that such can’t be “manifestly unreasonable.” We wrote about this concept here: https://mikebrandlyauctioneer.wordpress.com/2017/03/01/auctions-that-are-manifestly-unreasonable/. Importantly, it’s only a suggestion to a bidder or buyer that your terms and conditions are such, which invites a judge or jury’s decision if they actually are materially unreasonable.
Life has risks, but it seems we as auctioneers should endeavor to minimize risk — without merely assigning it to sellers and bidders, or disclaiming it, which doesn’t eliminate it, and rather just places it elsewhere. If you think of a scale, where one side is heavier than the other — you can move some of that excess weight to the other side, or just remove a bit more altogether.
Continuing with that analogy, any business relationship with less “weight” is probably better. Why aren’t we as auctioneers endeavoring to operate more simply, more streamlined, like we prefer to be treated by others? Quite frankly, nobody is seeking unnecessary complication, nor gain (or maintain) any unneeded weight.
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 and Western College of Auctioneering. He is 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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