tirebird
04-19-2006, 11:59 PM
There is a great column in the curent(May) issue of Sports Car Market. It's written by an attorney and car collector and it discusses the all too common bidding by sellers on their own cars or by auctioneers, on behalf of sellers, on cars they are selling.
I won't go into all the details but basically the conclusion is that it's illegal for a seller to bid or have someone bid on his vehicle during "no reserve" auctions. It's fraud and misrepresentations. However, on "reserve" auctions, where the reserve price has not been met, the law is murky and may protect this practice.
Also, the author says many big auction houses, in black and white, tell bidders in their bidders contract, that "the auction reserves the right to accept bids from sellers and to make bids on sellers behalf". So, be careful what you sign at an auction.
There is a lot more interesting information in the article including how a buyer can protect him/herself from this kind of fraud.
I won't go into all the details but basically the conclusion is that it's illegal for a seller to bid or have someone bid on his vehicle during "no reserve" auctions. It's fraud and misrepresentations. However, on "reserve" auctions, where the reserve price has not been met, the law is murky and may protect this practice.
Also, the author says many big auction houses, in black and white, tell bidders in their bidders contract, that "the auction reserves the right to accept bids from sellers and to make bids on sellers behalf". So, be careful what you sign at an auction.
There is a lot more interesting information in the article including how a buyer can protect him/herself from this kind of fraud.