Be Sure Before You Place That Bid...

Thursday 15th March 2018 - Della Bentham

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Be Sure Before You Place That Bid...

By placing a bid at auction you are entering into a legally binding contract to complete the purchase. This is something that has been highlighted heavily recently after the 'accidental' bid on a 114-year-old carousel.

 

A story in the news recently caught our eye and caused some debate online. It seems that a man ‘accidentally’ placed a bid in an online auction of £180,000 for a vintage carousel. It appears that lot 890, which was the most expensive lot of the auction, originally received no bids and passed unsold, but an online bid came in shortly after. As no other bids had come through for the carousel, the auctioneer is understood to have accepted the bid and sold the fairground ride to the bidder.

 

The auction house was ecstatic to have sold the 30-tonne ride, which would have set the bidder back around £250,000 once taxes and fees were added. Unfortunately for them though, the bidder claims he made the bid in error and asked to withdraw it.

 

When bidding at auction, online, or in person, bids are a legally binding contract to purchase, the difficulty here, of course, is how can you enforce a sale, which equates to the price of a house if the bidder doesn’t have the money?

 

The story caused some conflict in opinions, with some saying the bidder should be made an example of, while others said it could have genuinely been a mistake and should be forgotten. The company that supplied the online bidding for this auction says that enough steps are in place to ensure bidders are serious. They have to register details, add shipping details, payment card details, they’re independently fraud checked, the IP address is checked against the supplied address and the customer's card is checked for funds. A system like this is put in place to try and ensure incidents like this do not occur. So, could it have genuinely been an accident?

 

Fortunately for the bidder in this instance, the auctioneers released a statement saying they would not force the bidder to honour the bid, and there would be no further action, which is lucky for him, but raises the question do people not understand the seriousness of placing a bid at auction?

 

This isn’t the first time stories of accidental expensive auction purchases have hit the headlines. Back in 2016, a man claims to have accidentally purchased a bus on eBay after having a few too many to drink!

 

So…. Could the auctioneer have legally pursued the bidder for the cost of the 114-year-old carousel? Technically, yes, which is why we display the following warning on our own website:

 

IMPORTANT: Clicking the 'BID' button or placing an 'Autobid' is a commitment to buy and is legally binding in accordance with UK law.

 

eBay themselves tell bidders if you win the auction you are entering into a legally binding contract, they make some exceptions for motor vehicles and real estate, but as eBay sellers know, enforcing this can be difficult.

 

This must have been a huge disappointment for the auctioneer and seller, who believed they had a sale. While some auctioneers require a deposit in advance to bid on expensive lots, the majority do not enforce this, as the systems in place as mentioned above, are generally enough to deter pranksters and those that are unsure.

 

The number of steps put in place in a buying process is something sellers like Amazon carefully consider. The less steps a customer has to take, the more likely they are to buy. Having too many steps before the final purchase button is known to heavily increase the number of abandoned shopping carts, because the buyer has too much time to think and decide against the purchase.

 

We’ve all heard the jokes about customers sneezing and their movement being placed as a bid, but all jokes aside, it seems this man had to complete a number of steps prior to pressing the bid button that should have prevented this ‘accidental bid’. Whether you are bidding yourself in an auction room or bidding online it is important to remember that bids are legally binding. This protects both the buyer and the seller in the same way. It means a seller also can’t suddenly change their mind after the hammer falls.

 

So, before you bid at auction…

 

  • Do your research, ask the auctioneer questions and view the item if possible.
  • Consider your maximum price.
  • Consider the fees that will be added to the final hammer price. Check these out before setting your budget so you know it’s affordable.
  • Don’t attend auctions in person or online drunk.