THE

LAW

PAGE

By David Allen

Auctions

Goods put in for sale by auction are sold either with or without a reserve. A reserve price is one below which the auctioneer will not sell the goods. If the auctioneer mistakenly sells the goods below this price, there is no legaly binding contract. McManus v Fortescue (1907) Pending If the goods are put in the sale without reserve then this is an offer to the public that if the auction is held they will sell to the highest bidder. Warlow v Harrison (1859) An auctioneer must sell to the highest bidder if not then the owner can sue the auctioneer. However in this case the auctioneer escaped this because the auctioneer must sell to the highest bone fide bidder. In this case the owner put in the highest bid and tried to sue the auctioneer for not accepting it. As the contract is between the owner and the buyer he was not the bone fide bidder. (Obiter)