2011 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.
KY Rev Stat § 330.220 (1996 through Reg Sess) What's This?
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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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
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anyone acting upon behalf of the seller, shall not bid at the absolute auction,
or otherwise participate in the bidding process.
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, 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
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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 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, 2009
History: 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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