BUYER INFORMATION
Welcome to the world of auctions. There is no better way to purchase goods than at auction. In an auction, you the bidder, determine the price. You compete with other bidders under the same Terms & Conditions. And, above all, auctions are fun. If you are new to auctions don’t be afraid. An auction isn’t like what you see in the movies. You won’t end up purchasing something just because you looked the wrong way. But you do need to know a few basics before getting started. Read the information below. Read the information in the links above. Get registered to bid. You can find out how to register to bid by clicking the How to Bid link. Then watch an auction. When you are comfortable, then bid.
WHAT IS AN AUCTION?
An auction may be a public or a private sale. During an auction, property is offered for sale by a seller. Potential buyers, referred to as bidders, make offers on the property in the form of bids. Each bidder competes for the property under the same Terms & Conditions. Property is offered individually or in groups of items. Each offering, whether an individual item or a group of items is referred to as a Lot. Once a high bidder is determined, by the fall of the hammer (gavel) or by the word “Sold”, the lot is considered closed. The high bidder is also referred to as the buyer.
AN AUCTION FORMS A CONTRACT
In general, a contract for sale and purchase is created at an auction. With the fall of the hammer or the word “Sold”, an offer and acceptance supported by mutual promises is formed. The contract is between the seller and the buyer, and is based on the Terms & Conditions of the sale. Therefore, at an auction the price is the only subject of the negotiation. Under the Uniform Commercial Code, each lot of an auction is subject to a separate sale. The contract may be oral or written. Both are enforceable under normal circumstances. However, each state typically has a Statute of Frauds, requiring certain contracts to be written. An example of a contract that must be written is a real estate contract. This section is not intended to give legal advice. For legal advice regarding the contract created through an auction, please contact your attorney.
AUCTIONEER AS AGENT
Generally, an auctioneer is an agent of the seller. Through a separate contract, the auctioneer offers the seller’s goods to potential buyers. The auctioneer is not party to the contract created by the auction, unless the auctioneer is either the seller or the buyer. The auctioneers duties include maintaining a fair bidding environment for potential buyers, maintaining adherence to the Terms & Conditions set forth by the seller, and representing the seller in facilitating the sale.
AUCTIONEER LICENSING
Many States require auctioneers and/or auction businesses to be licensed. If a business or individual is in contract with a seller to act on their behalf, in any aspect of an auction sale, they may be subject to auction laws. Florida for instance, requires auction businesses and auctioneers to be licensed. In Florida, an auction business conducting an auction on behalf of a seller, must appoint a Principal Auctioneer to oversee the sale. In Georgia, an auction business can be exempt from licensure if the applicant is both the owner of the business and a licensed auctioneer, or if the business employs a full-time licensed auctioneer who agrees to supervise the operations of the business. For your protection, if a State requires licensure, verify both the Auction Business and the Auctioneer license. In Florida you can verify a license here. In Georgia, you can verify a license here.
BIDDING
Bidding in an auction is the act of making an offer on a lot. Read the auction Terms & Conditions prior to bidding. Typically the act of bidding in an auction confirms your acceptance of Terms & Conditions. Bidding follows a bid increment table established before each auction. At certain increments, the acceptable next bid becomes higher. See How to Bid for more information on bidding and bid increment tables. Your bid may not be the total amount on your invoice. Under the Terms & Conditions of the auction, you may also be charged Sales Tax, a Buyer’s Premium, or other fees.
BUYER’S PREMIUM
A Buyer’s Premium is a Fee or Commission charged to the Buyer. It is NOT a fee to bid. The only person who pays a Buyer’s Premium is the high bidder who becomes the buyer. The Buyer’s Premium is expressed as a percentage. Typical Buyer’s Premiums at Bidilla, Inc. auctions are 10% and 15%. This is calculated on the high bid and added before calculating Sales Tax. If the auction Terms & Conditions stipulate a 10% Buyer’s Premium, and you want to spend no more than $100 on the lot prior to sales tax, only bid to $90. If you are declared the high bidder at the close of the lot, you will be invoiced for the $90 bid + a $9 Buyer’s Premium (10% of the $90), totaling $99. Sales tax. if owed, will then be calculated on the $99 total.
SALES TAX
Bidilla, Inc. collects sales tax, both state and local, based on the location of the auction. In most cases, you will be charged sales tax at the rate for the auction location where you or your agent pick up the merchandise. Most State Departments of Revenue require that sales tax be calculated on the total invoice amount including the Buyer’s Premium. If you are purchasing for resale or are tax exempt, please email a scan or photo of your resale certificate or your tax exempt certificate prior to the auction. You can email your certificate to info@bidilla.com.
OPENING BIDS & RESERVES
An opening bid is simply the lowest bid that will be accepted to start the bidding on a lot. A reserve on the other hand is the lowest price a seller will accept for a lot to be considered sold. Most items sold by Bidilla, Inc. have no reserve. However, if an item has a reserve, the opening bid will typically be lower than the reserve amount. Reserves can be disclosed or undisclosed, and Bidilla, Inc. reserves the right to bid on behalf of the Seller up to the reserve amount.
WARRANTY
Unless an Express Warranty is clearly stated in the Terms & Conditions for a specific auction, or stated in the description of a lot, all property is sold “AS IS”, “WHERE IS” WITH NO WARRANTY EXPRESS OR IMPLIED.