Dodgy auction - any grounds for complaint?

sly_dog_jonah

davidmcn wrote: »

Since when have auctioneers had to "vet" bidders? Did they vet you?

Best practice is to require bidders to register with approved identification & provide proof of funds.

And no we weren't vetted either, even though we took all the above to the auction.

kinger101

sly_dog_jonah wrote: »

Hardly think it's best practice that the auctioneers didn't disclose the reasons behind the late and incomplete legal packs. Our costs were higher because the solicitor had to chase them repeatedly.

We're not house stalkers and *had* moved on from the disappointment. But we learned yesterday via another EA who advised that the property was coming back on the market again after less than 12 months. According to the EA the losing bidder who pushed the price out of the range of all the other bidders 'didn't have the funds to buy it' which sounds like they may have been a shill for the SIL, and indicates a failure on the auctioneers to vet bidders.

Needless to say we will approach any future auction with suspicion.

You won't be able to prove the shill bidding. I'm not sure how the EA could have known the exact financial circumstances of the putative shill bidder given they won't have gone through their finances with them in detail (and shouldn't be disclosing this to you had they done so). The fact remains you were still outbid (conceptually, as you didn't even place a bid), and the purpose of the auction was to obtain fair market value.

The only thing that may have been questionable was if the sisters bid and didn't win. But presumably, there would be documentation to support SIL not accepting a private sale.

DandelionPatrol

Thrugelmir wrote: »

You were outbid by other parties as well. Sounds more like sour grapes.

getmore4less wrote: »

Looks like you underestimated the value significantly...

If it had been a straight purchase by an unrelated party, I would agree with the above.

Plainly, the sisters were able to make a leveraged bid. If the property went for 135% of value, they would have paid 45% of value to the SiL, ie 22.5% each to gain a 1/6th share. ie they each paid 5.8% of total value over for a 50% share of total value. So they got complete control for 11.7% overvalue on their respective final shares.

This to me is not straight dealing on the part of the seller or the auctioneer, because OP has been put to legal expense when the market was not a level field.

My sympathy is with OP here, before we even get to the question of whether there was shill bidding on behalf of the SiL.

kinger101

DandelionPatrol wrote: »

If it had been a straight purchase by an unrelated party, I would agree with the above.

Plainly, the sisters were able to make a leveraged bid. If the property went for 135% of value, they would have paid 45% of value to the SiL, ie 22.5% each to gain a 1/6th share. ie they each paid 5.8% of total value over for a 50% share of total value. So they got complete control for 11.7% overvalue on their respective final shares.

This to me is not straight dealing on the part of the seller or the auctioneer, because OP has been put to legal expense when the market was not a level field.

My sympathy is with OP here, before we even get to the question of whether there was shill bidding on behalf of the SiL.

It's an interesting point, but you've used an extreme example to illustrate this. In reality, the sisters' bid may have been say 2% above the previous bid rather the 35%. This strongly diminishes the benefit of having the leverage.

Is £750 a reasonable fee for checking legal packs? Conveyancing can cost less than this!

davidmcn

sly_dog_jonah wrote: »

Best practice is to require bidders to register with approved identification & provide proof of funds.

So you send your shill bidder along with ID and proof of funds.

But I've not encountered any auctioneers which do more than checking ID and taking the deposit from the successful bidder, so I'm not sure where this "best practice" comes from.

Thrugelmir

DandelionPatrol wrote: »

If the property went for 135% of value,

That's a nonsensical assumption to a calculation on. What ever else may have occurred the OP was well and truly outbid.

getmore4less

They(sisters) only needed to stop all other interested parties

If one of those interested parties was the SIL then that fine and legal

They could have stopped bidding sooner and just let the SIL have it.

Old_Git

the two sisters did nothing wrong .There must have been at least one other bidder for the price to go so high .
I have sold at auction ,the way it worked for me was ,they put a guide price (to get interest ) and reserve price .Mine sold £8000 above the reserve .

Mossfarr

As you were outbid at the auction you have no argument really. It may not have seemed 'fair and square' but sadly, thats life!
I think your loss of £750 is the main issue here - that is an extortionate sum of money for simply checking a legal pack. This service was provided free by solicitors at the auctions I have attended.
mossfarr

bsms1147

sly_dog_jonah wrote: »

...especially as they overpaid by around 100k (the other bidders dropped out at around 600k but it went for 705k)

How does that happen? If the other bidders drop out at 600k, why would they not win it for the next increment in price, which isn't going to be 105k.