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  • Writer's pictureMike Brandly, Auctioneer

A quick reference: when the auction buyer …

Auctioneers and their sellers occasionally encounter issues with buyers. Mostly these issues involve (personal property) possession and/or payment. When buyers don’t pay, that’s a problem and likewise, when buyers don’t take possession, that’s a problem.

To explore these circumstances in more detail, let’s say an auction bidder is deemed the high bidder and the subject property is declared, “Sold!” Then …

  1. The buyer does not pay and the seller/auctioneer remains in possession of the subject property.

  2. The buyer pays but does not take possession of the subject property.

  3. The buyer takes possession of the subject property, and does not pay or revokes payment.

  4. We would suggest that if a buyer doesn’t pay and the seller/auctioneer remains in possession, the Uniform Commercial Code (UCC) § 2-706 likely provides the solution. With proper notice to the buyer, the property can be resold. We wrote more about this here: https://mikebrandlyauctioneer.wordpress.com/2020/11/25/auction-buyer-didnt-pay/.

  5. If rather the buyer pays but doesn’t take possession, it’s possible with sufficient notice that the property becomes essentially abandoned. At that point, generally, whoever is in possession can resell, keep, discard, or even donate. We wrote more about this here: https://mikebrandlyauctioneer.wordpress.com/2020/09/02/auctioneers-with-stuff-leftover/. We also wrote about lost versus misplaced versus abandoned here: https://mikebrandlyauctioneer.wordpress.com/2017/12/28/auctions-with-lost-misplaced-and-or-abandoned-property/.

  6. Finally, if a buyer takes possession and either doesn’t pay or revokes payment, that is likely a crime if there is intent to commit such. Of course, people sometimes accidentally write a bad check, or initiate a chargeback on the wrong item, or forget to pay where it’s possibly not a crime, and rather a civil matter. We wrote more about this here: https://mikebrandlyauctioneer.wordpress.com/2018/04/09/auction-bidder-buys-takes-and-doesnt-pay/.

As auctioneers are in fiduciary roles as agents for their clients (sellers,) any subsequent action following #1, #2, or #3 above should be done in an attempt to maximize the seller’s position and only profit the auctioneer accordingly, and not primarily.

Far too often, we’ve seen auctioneers take actions to personally benefit, leaving the seller out of their considerations. In fact, in any of these situations, it’s imperative to discuss actions with the seller as the buyer/seller contract involves those two parties, and necessarily not the auctioneer.

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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