With more and more shipping of auction purchases, auctioneers occasionally discover that buyers will report they never received their purchase. This comes in two varieties (1) they never received anything or (2) they received something, but not what they purchased.
For (1) above (not receiving anything) tracking can likely solve that problem. We’ve shipped auction purchases for years, and occasionally a buyer will say he never received it, but tracking shows it was delivered — and/or he (somebody) signed for it.
For (2) above (received the wrong item) this becomes a bit more complex. The auctioneer can claim the correct item was shipped, but the buyer could claim the wrong item arrived. Unless the auctioneer has proof the correct item was packaged, it becomes largely an issue of his-word-against-yours.
Of course, mistakes can happen, and further, unfortunately, there are people who can’t be trusted. Auctioneers in these situations should try to correct any mistakes, but be alert of buyers providing false information. If the issue can be solved for minimal time/expense, seek that solution. Otherwise, for materially valuable subject items, seek competent legal counsel.
Auctioneers shipping materially valuable items should possibly take extra steps to ensure a successful transaction — including video, possibly tamper-proof packing, arranging for personal or courier delivery, or even coordinating for buyer pick up only. Insurance is also prudent and can also help to reimburse costs incurred.
Further, as we wrote prior about title, delivery, and non-conforming:
With more and more being sold at an online auction — versus a live auction — with shipping involved (as well as from a live auction) to the destination of the buyer, title would pass at delivery, where the payment was surely secured prior to shipment. Shipped and delivered items where the buyer rejects the subject property due to it being non-conforming (UCC § 2-602) can be reimbursed for the purchase price if such notice is within a reasonable time following buyer inspection. Of course, the buyer then would have to safeguard the property for the seller’s benefit. If a buyer receives the subject property and has the reasonable opportunity to inspect, and does not notify the seller the property is non-conforming soon thereafter, acceptance is assumed whether conforming or not. For a live auction with reasonable inspection opportunities, this issue is largely moot. https://mikebrandlyauctioneer.wordpress.com/2021/10/28/title-possession-and-risks/
It’s doubtful the shipping of auction items will ever be perfect for every seller, every auctioneer, every lot, every buyer, every day. The issue will more likely be if the value of the item is such that the auctioneer can simply reimburse the buyer, or if more steps are prudent to ensure proper delivery and/or to properly insure the transaction.
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 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 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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