2014 Kentucky Revised Statutes CHAPTER 330 - AUCTIONEERS AND AUCTION HOUSE OPERATORS 330.220 Lots or parcels subjects of separate sales -- When auction is complete -- "Absolute auction" defined -- Presumption of reserve auction -- Bids by seller -- Avoidance of sale -- Prohibitions.
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330.220 Lots or parcels subjects of separate sales -- When auction is
complete -- "Absolute auction" defined -- Presumption of reserve auction
-- Bids by seller -- Avoidance of sale -- Prohibitions.
(1)
(2)
(3)
If real or personal property is offered in lots or parcels in a sale by auction,
each lot or parcel shall be the subject of a separate sale. This subsection shall
not preclude real or personal property from being offered for bidding
individually or in some form or combination.
Unless otherwise provided in the conditions of sale for auctions regarding
horses or any interests therein, a sale by auction is complete when the
auctioneer so announces by the fall of the hammer, announcing the item sold,
and the successful bidder's identification or in other customary manner. If it
becomes immediately apparent at the close of the bidding that the auctioneer
and a bid assistant or ringman have acknowledged the same bid from different
bidders, the auctioneer may continue the bidding between the disputed
bidders. When a bid is made while the auctioneer is in the process of
completing the sale by auction, the auctioneer may continue the bidding or
declare the real or personal property sold under the bid on which the hammer
was falling.
No auction shall be advertised as "absolute" nor shall any advertising contain
the words "absolute auction" or the word "absolute" or words with similar
meaning nor shall any licensee offer or sell any real or personal property at
absolute auction unless:
(a) There are no liens or encumbrances on the real or personal property,
except property tax obligations, easements, or restrictions of record, in
favor of any person, firm, or corporation other than the seller, or unless
each and every holder of each and every lien and encumbrance, by
execution of the auction listing contract, or otherwise furnishing to the
auctioneer written evidence of a binding commitment therefor, shall have
agreed to the unqualified acceptance of the highest bid for the property,
without regard to the amount of the highest bid or the identity of the high
bidder; or, alternatively, that a financially responsible person, firm, or
corporation, by execution of the auction listing contract or by otherwise
furnishing to the auctioneer written evidence of a binding commitment
therefor, shall have absolutely guaranteed the forthwith and complete
discharge and satisfaction of any and all liens and encumbrances
immediately after the sale or at the closing, without regard to the amount
of the highest bid received, or the identity of the high bidder; and
(b) There is the bona fide intention at the time of the advertising and at the
time of the auction to transfer ownership of the real or personal property,
regardless of the amount of the highest and last bid, to the high bidder,
that intent existing without reliance on any agreement that any particular
bid or bid level must be made or be reached, below which level the real or
personal property would not be transferred to the high bidder; and
(c) The auction listing contract contains a binding requirement that the
auction be conducted without reserve, and includes an acknowledgment
that the seller, or anyone acting upon behalf of the seller, shall not bid at
the absolute auction, or otherwise participate in the bidding process.
(4)
(5)
(6)
Compliance with subsection (3) of this section shall not prohibit:
(a) A secured party or other lienholder who is not the seller from bidding at
an absolute auction, providing that such bidding does not constitute, nor
is it tantamount to the direct or indirect establishment or agreement to the
establishment of a reserve price on the real or personal property by the
seller or by the auctioneer, or by anyone aiding or assisting, or acting
upon behalf of, the seller or the auctioneer; or
(b) Any individual party to the dissolution of any marriage, partnership, trust,
limited liability company, or corporation from bidding as an individual
entity apart from the selling entity, on real or personal property being sold
at auction pursuant to that dissolution; or
(c) Any individual party or heir of a deceased person's bona fide estate from
bidding as an individual entity, apart from the selling entity, on real or
personal property being offered at auction pursuant to that estate
settlement; or
(d) The inclusion of nonmisleading advertising of certain real or personal
property to be sold at "absolute auction" and the nonmisleading
advertising of certain real or personal property to be offered at auction
with reserve, within the same advertisement, or for sale at the same date
and place, providing that advertisement shall make clearly apparent
through equal or appropriate emphasis, which real or personal property is
being offered by each method.
Any auction sale is, without requirement of announcement at any time,
presumed to be with reserve unless the real or personal property is in explicit
terms offered at absolute auction. An auction without reserve means an
absolute auction. An auction with reserve means the real or personal property
may be offered subject to the seller's confirmation or subject to a certain
reserve price. In an auction with reserve, the auctioneer may withdraw the real
or personal property at any time until he or she announces completion of the
sale. In an absolute auction, after the auctioneer calls for bids on an article, lot,
or parcel, that article, lot, or parcel shall not be withdrawn unless no bid is
made within a reasonable time. At both reserve auctions and without reserve
auctions, the auctioneer may establish reasonable bid increments once an
opening bid has been offered.
(a) The provisions of this chapter shall not prohibit any licensee from bidding
on his or her own behalf at any auction sale, whether absolute or with
reserve, if his or her option to do so has been fully disclosed, including
disclosure to the seller.
(b) Except as provided in subsection (4) of this section, the seller may not bid
at an absolute auction, nor may anyone bid upon his or her behalf. No
licensee shall knowingly receive a bid by or on behalf of the seller at an
absolute auction.
(c) Bids may be made by the seller, or upon the seller's behalf, at any
auction with reserve, provided that full disclosure has clearly been made
that liberty for bidding is retained. No licensee shall knowingly receive a
bid in the absence of full disclosure. If the auctioneer knowingly receives
a bid on the seller's behalf or the seller makes or procures a bid and
(d)
(e)
(7)
(a)
(b)
notice has not been clearly given that liberty for bidding is reserved, the
buyer may avoid the sale or take the real or personal property at the price
of the last good faith bid prior to the completion of the sale.
There shall be no requirement that the reserve be announced when it is
attained.
Nothing in this subsection shall be construed to alter or diminish the
provisions of KRS 330.210.
At any absolute auction, any advertisement or representation of a
minimum or suggested starting bid is prohibited.
At any reserve auction, any advertisement or representation of a
minimum or suggested starting bid is prohibited unless:
1.
The minimum or suggested starting bid advertised or represented is
sufficient to satisfy the auction listing contract stated reserve or
confirmation amount; and
2.
The auction listing contract contains a binding acknowledgment by
the seller that permission has been granted for disclosure.
Effective:June 25, 2013
History: Amended 2013 Ky. Acts ch. 44, sec. 1, effective June 25, 2013. -Amended 2009 Ky. Acts ch. 70, sec. 20, effective June 25, 2009. -- Amended
1992 Ky. Acts ch. 344, sec. 17, effective July 14, 1992. -- Created 1990 Ky. Acts
ch. 170, sec. 10, effective July 13, 1990.
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