Preparation
1. You must view and inspect any items in which you are interested well before the auction date - or get someone you trust to do so on your behalf. All Auction items on auction are sold "voetstoots" (which means "as is"), so you must know if there are any damages or work to be done before you decide how much you are prepared to bid.
2. You should gather as much additional information as you can about the item/s & its conditions ahead of the auction.
3. Next it is essential that you get a copy of Auction Rules & Auction Catalogue and read it very carefully before auction day. You must be sure you understand exactly what is being offered for sale and exactly what else you might be taking on - .A winning bid at auction is legally binding and cannot be retracted later without considerable financial loss.
4. If you decide to bid on a auction item, you must arrange the finance you will need to buy it well ahead of time. Auction sales are non-suspensive, which means that they do not allow time for you to go and arrange finance after the fall of the hammer. If your bid wins, you will have to pay the full amount and auctioneer’s commission (Plus VAT) on the same day,
5. If you want to make your bid remotely, you will also need to arrange this in advance. You will have to complete a proxy form that mandates the auctioneer or assistant to record your bids, and you will need to pay the (refundable) auction registration fee. You will probably also be asked to make a good faith deposit of a significant percentage of your likely bid, which will also be refunded if you are unsuccessful.
At the Auction
1. You must register as a bidder and get a number or a bidder’s "paddle" valid for the specific auction you are attending. You will need your ID document, proof of your residential address (such as a municipal account), and the registration fee, payable by EFT or bank guaranteed cheque. This is fully refundable if you decide not to bid after all, or if your bid is unsuccessful. You still need to register even if you will be bidding on behalf of someone else or a legal entity such as a close corporation or trust, and in such cases you will be asked to produce proof of your authority to bid. You may also be asked to sign an undertaking (surety) making you responsible to go through with the purchase if the other person/ entity drops out after a successful bid.
2. Check to see if there have been any amendments or additions to the Conditions of Sale/rules of the auction that you obtained in advance of the auction., be sure to raise them well before the bidding starts.
3. Obtain a copy of the Auction catalogue and find out the lot number of the items on which you wish to bid. Make sure you are in a position where the auctioneer can see you, and be ready to bid quickly and decisively when your lot comes up.
4. Auctions may be conducted with or without a "reserve price" - a minimum price known to the auctioneer and seller of the items. Absolute auctions are sales where there is no reserve price and the items is simply knocked down to the highest bidder. This is usually the case at there is a reserve price but the highest bid at auction does not reach this price, the sale will probably be made subject to confirmation (STC) by the seller/Auctioneer. If yours was the highest bid, you can expect an answer from the seller/Auctioneer within a short time, and you will remain bound by your bid during that time.
5. If your bid is immediately successful, you will be asked to Make payment as per Pro forma Invoice as stipulated, The balance of the purchase price will be payable immediately after the auction, therefore you need to have the funds available very shortly after the auction so you can provide payments.
6. Before you leave the auction, you should double check when the risk in the items passes to you as the purchaser - on fall of the hammer. You need to remove your bidded item/s asap after making payment so that you will be protected against financial loss in the event of the items being damaged/and or stolen whatsoever disaster.
After the Auction
1. It is too late after the auction to express dissatisfaction with a item you have bought. All auction items are sold "voetstoots", which means "as is", and the bids are made in public, which means that you have no recourse if you made a mistake and bid for the wrong item/s, and cannot negotiate price if you later discover things wrong with the item/s you bought. This is why it is so important to thoroughly inspect any items in which you are interested before the auction.
2. If you default on the sale after the auction, the auctioneer will have the right to take legal action against you and force you to fulfil the obligation. There is usually a provision in the Auction rules that if you then cannot or will not do so, all monies that you have already paid will be forfeit as "rouwkoop". It is legally and financially very serious to go into breach of rules of the auction so unless you are absolutely sure you want and can afford the item, it would be better to refrain from bidding.
Auction Terms
Auction – A public sale in which goods or properties are sold to the highest bidder.
Bid – An offer of payment made or tendered at an auction by a prospective buyer.
Commission – The amount the auctioneer charges in return for organising a successful sale. It is usually paid by the buyer.
Conditions of Sale/ Rules of Auction – The terms under which a auction items is being sold at auction.
Deposit – There are two kinds of deposit payable at auctions: a registration deposit which entitles you to bid and is refundable if you are unsuccessful
Fall of the Hammer – Signals the end of a period of bidding for a particular item or property at an auction and means no further bids for that item will be accepted.
Lot Number – The number assigned to a certain item or property at an auction.
Order of Sale – The order in which lots at an auction will come up for sale. This will not necessarily be numerical as similar items with widely varying lot numbers may be grouped together for convenience.
Proxy – A person authorised to perform certain actions on behalf of another, like bidding on their behalf at an auction. The word may also refer to the document authorising the stand-in.
Reserve Price – A minimum price for any item or property on auction that has been agreed on by the seller and the auctioneer. If the bids do not reach the reserve price, the seller is not obliged to go through with the transaction.
Subject To Confirmation (STC) – Whereas the reserve price is not reached, the auctioneer will sell the items as STC (pending confirmation from the seller nor the auctioneering head of sales)
Rouwkoop – Money paid, such as a purchase deposit and the auctioneer’s commission, which will be forfeit if the buyer later defaults.
Surety – A pledge given to protect the recipient against loss in case the terms of a contract are not filled.
Voetstoots – A terms that describes the sale of a property/item/s exactly “as is” or with all its faults, and where the seller has no legal responsibility for its condition.
