Absolute = Without Reserve; Without Reserve = Absolute

Mike Brandly, Auctioneer Blog

Is an absolute auction the same as a without reserve auction? Is a without reserve auction the same as an absolute auction?

In theoretical mathematics, if A = B and B = A, then A and B are the same thing, thus this question posed here about absolute auctions.

The UCC 2-328 describes only two types of auctions:

  1. With reserve
  2. Without reserve

No mention of the word, “absolute” at all in this doctrine.

Yet, in common usage with auctioneers all over the United States and territories, the word, “absolute” has come to mean an auction “without reserve.” And, if an auction is deemed “without reserve,” then it is commonly deemed an “absolute” auction.

Why this discussion, then, if it is so easily answered?

Some argue, and with some merit, that a without reserve auction has certain rules, such as no limiting conditions, no minimum bids, no reserve amounts, no withdrawal…

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What do auctioneers owe their customers?

Mike Brandly, Auctioneer Blog

refsFirst, let’s define the term “customer.”

It is not the same as “client” as the client has hired us to perform duties on their behalf.

Customers, on the other hand, are typically considered buyers, who attend our auctions to purchase from our clients.

Customers are owed basically three things:

  1. Honesty
  2. Integrity
  3. Fair Dealing

Let’s look at these three in a bit of detail, with a short example:

Honesty is being honest. In other words, not lying to them, but rather telling them the truth. For example, “Does this car run?” would be a fair question a buyer (customer) may have. If the car doen’t run, then an honest answer would have to be “No, the car doesn’t run.”

Integrity is more or less taking honesty a step further, and necessitating that the auctioneer act in an ethical fashion with the customer. For example, if another customer noted that the aforementioned…

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Absolute Auctions

Mike Brandly, Auctioneer Blog

Armed with the most powerful marketing method that exists, Auctioneers all over the world know in order to maximize results for their clients, they must maximize interest in those items. More bidders means more money, just as fewer bidders means less money. The larger the number of bidders, the more competition there is, especially as the bidders sense that the other auction attendees are interested in the same item as they are. And, as we all know, emotions are involved when it comes to bidding at auction.

There is no other aspect of a public auction that attracts attention more than buyers feeling as if they might “get a deal” on something they want. The prospect of a deal is what drives bidders to auctions. Sometimes they feel as if they get a deal, sometimes they don’t, but getting them there is essential to competitive, top-dollar bidding. When sellers place…

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Auctioneers and the seller’s identity

Mike Brandly, Auctioneer Blog

charltonrockFirst, let us say that at most all auctions in the United States, the seller’s identity is not advertised nor disclosed to the (potential) bidders.

Secondly, there are no laws which require auctioneers to disclose the seller’s identity to (potential) bidders.

Despite these facts, it is necessary or proper to disclose (in advertising or otherwise) the identities of the sellers?

Let’s review the duties owed clients (sellers) by auctioneers: http://mikebrandlyauctioneer.wordpress.com/2009/11/18/what-do-auctioneers-owe-their-clients/

As well, let’s review duties owed customers (bidders/buyers) by auctioneers: http://mikebrandlyauctioneer.wordpress.com/2009/11/19/what-do-auctioneers-owe-their-customers/

From these duties, it is clear that first, if disclosing the identity of the seller is in the seller’s best interest and the seller authorizes such disclosure, then such is prudent. If a bidder wants to know the identity of the seller (for a particular item, or generally,) then such should be disclosed if authorized by the seller.

Too, such advertising or disclosure is not to be misrepresentative independent…

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Auctioneers and the number of combinations

Mike Brandly, Auctioneer Blog

cornfieldDr. Mary Dewalt is retiring from her medical practice. She is 83 years old and is moving permanently to her condominium in Florida.

Mary’s family has owned 2,540 acres of farmland in southern Indiana for 135 years. The land includes four homes, nine large barns, and two 300,000 bushel grain handling systems.

Mary has contacted a local auctioneer to sell her farm at auction. The auctioneer has suggested that the land be sold by “open combination bidding” or as some call it, a “multipar,” “multi-parcel” or “multiple parcel” auction.

We wrote about a particular aspect of a multiple parcel auction (selling absolute) and a bit more on the history of these types of auctions here: https://mikebrandlyauctioneer.wordpress.com/2012/10/16/an-absolute-multiple-parcel-auction/

Today, we explore another aspect of the multiple parcel auction: The number of combinations the various parcels can be grouped. For instance, let’s say Mary and her auctioneer decide it’s best to divide the…

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Auctioneers and D U S T

Mike Brandly, Auctioneer Blog

auctionhouseWe run an auction house located in central-Ohio. There are over 2,000,000 people residing within 50 miles of our facility and we have bidders sometimes come from over 300 miles away. We’ve run weekly auctions at this same location for over 13 years.

Our average crowd numbers right around 250. We’ve had over 700 in attendance when our inventory was widely varied and interesting, and we’ve had only 100 bidders when we’ve had a narrow inventory such as just coins, just matchbox cars or just guns.

Everything we put up for auction sells without reserve (absolute.) That means there are no minimums, no reserves, and the seller is prohibited from bidding. I’m convinced we get consistently larger crowds due to this — in fact, I know as much.

On average, we run 2 or 3 auctioneer rings, and we’re fortunate to have Peter Gehres and Laura Mantle currently helping us…

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Supply sophism

Mike Brandly, Auctioneer Blog

gulfstream11 years ago this month, I was boarding a Gulfstream G100 on a flight from Ohio to Missouri.

We were flying to Missouri to inspect a noted inventory of antiques and collectibles. The owners (husband and wife) wanted to discuss us selling this entire collection at auction, live and online, at our secondary auction facility in Lancaster, Ohio.

Once on the ground in Missouri, we met our prospective clients. We enjoyed some dinner and then proceeded to their home stocked with these aforementioned items.

As I walked from room to room … to room, both the husband and wife showed me paintings, pottery pieces, glassware, silver, furniture, statuary, and so forth. For each item, a typical remark was something along the lines of “Now this piece is particularly rare …”

“Particularity rare?” I thought not. I had seen (and sold at auction) many identical like-kind pieces numerous times. In fact…

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