Sale of Goods Act Section 64 — Auction sale

CHAPTER VII MISCELLANEOUS

Commercial / Corporate

Summary

Sub-section (1) covers goods sold in separate lots. When goods are put up for sale in lots, each lot is treated as its own separate contract of sale, unless the circumstances suggest otherwise.

Sub-section (2) explains when the sale is complete. The sale finishes when the auctioneer announces it is done, either by the fall of the hammer or in another customary way. Until that announcement is made, any bidder can withdraw their bid.

Sub-section (3) deals with the seller's right to bid. The seller can reserve the right to bid, but only if this is expressly stated. If such a right is expressly reserved, the seller or one person on the seller's behalf may bid at the auction, subject to the rules that follow.

Sub-section (4) sets out what happens when no right to bid is reserved. If the sale is not notified as being subject to a right to bid on the seller's behalf, the seller cannot bid himself, cannot employ anyone else to bid, and the auctioneer cannot knowingly accept a bid from the seller or such a person. If a sale goes against this rule, the buyer may treat it as fraudulent.

Sub-section (5) allows the sale to be notified as subject to a reserved or upset price. This means the seller can set a minimum price, and the sale can be announced as having such a price.

Sub-section (6) addresses fake bidding. If the seller uses pretended bidding to raise the price, the buyer has the option to void the sale.

Official Text

In the case of a sale by auction—

(1) Where goods are put up for sale in lots, each lot is prima facie deemed to be the subject of a separate contract of sale;

(2) the sale is complete when the auctioneer announces its completion by the fall of the hammer or in other customary manner; and, until such announcement is made, any bidder may retract his bid;

(3) a right to bid may be reserved expressely by or on behalf of the seller and, where such right is expressly so reserved, but not otherwise, the seller or any one person on his behalf may, subject to the provisions hereinafter contained, bid at the auction;

(4) where the sale is not notified to be subject to a right to bid on behalf of the seller, it shall not be lawful for the seller to bid himself or to employ any person to bid at such sale, or for the auctioneer knowingly to take any bid from the seller or any such person; and any sale contravening this rule may be treated as fraudulent by the buyer;

(5) the sale may be notified to be subject to a reserved or upset, price;

(6) if the seller makes use of pretended bidding to raise the price, the sale is voidable at the option of the buyer. 1