Auction marketing has evolved over the years. From the early days of seeing a “Public Sale!” advertisement, to today where the public regularly sees “Estate auctions,” “Important auctions,” “Large auctions,” “Absolute auctions,” and a myriad of other variations.
What’s the thinking here? Auctioneers endeavor to use wording to attract bidders — to get them to pay attention to their auction instead of doing something else that day.
A common technique for attracting attention is to suggest to bidders that the seller is “selling everything …,” in other words has “no control” to withdraw items or otherwise play a part in the auction.
One such type of auction where real and/or personal property is sold at auction — without the seller’s consent — is known legally as a “forced sale.”
The common interpretation of a forced sale is that a court or other governmental authority has ordered the property sold. Such auctions are commonly part of a bankruptcy, receivership, repossession, foreclosure, and the like.
Despite the UCC 2-328 allowing the seller to bid at a forced sale, the public largely gets excited at the prospect of an “ordered” public auction because of the third-party involvement, and the perceived prospect of a deal.
As Will McLemore, CAI and I were discussing the other day, because the idea of an “ordered” public auction attracts attention, some auctioneers are using this same terminology when the auction is not actually ordered at all.
Here’s the difference:
Court-Ordered Auction, Federal Bankruptcy Court 7th District, December 19, 2013, 10:00 a.m. … actually an ordered auction.
Mr. & Mrs. Frank Miller order the sale of their farm, December 19, 2013, 10:00 a.m. … actually not an ordered auction.
In our #1 example, a court is actually ordering this auction unilaterally and without the consent of the seller. In our #2 example, Mr. & Mrs. Frank Miller have entered into a bilateral contract with an auctioneer, consenting to the auction of their farm.
Of course, because a unilateral auction attracts more attention, the bilateral auction here is misrepresented as a unilateral auction; misrepresentation is at best unethical, and at worst illegal.
For those looking for auctions … it’s important to be mindful that truth in advertising has value. If the auction advertisement is truthful and not misleading, the odds of an honest, ethical auction experience are better.
Mike Brandly, Auctioneer, CAI, AARE has been an auctioneer and certified appraiser for over 30 years. His company’s auctions are located at: Mike Brandly, Auctioneer, Keller Williams Auctions and Goodwill Columbus Car Auction. His Facebook page is: www.facebook.com/mbauctioneer. He serves as Adjunct Faculty at Columbus State Community College and is Executive Director of The Ohio Auction School.
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