Opinion ID: 4541454
Heading Depth: 2
Heading Rank: 1

Heading: The price would have been $200,000.

Text: On April 5, 2018, the circuit court entered an order granting summary judgment to the plaintiff and denying the defendant’s motion for summary judgment. Because of the confusing language in the defendant’s advertisements and catalog, the circuit court found that the sale met the definition of an “auction with reserve” because of the requirement for a minimum bid of $200,000. However, once that minimum bid was placed, the circuit court found that the defendant had advertised the sale as an “absolute The defendant also asserted that it had an “in-house” policy of allowing 3 individuals to become “permanent qualified bidders” with a “permanent bid number,” and these individuals would not have to meet advertised qualifications before bidding at auctions. However, the defendant failed to produce any documentation showing Mr. Lerch was such a perpetually qualified bidder. Furthermore, the record is undisputed that the defendant neither advertised before, nor announced at, the auction its policy of waiving posted terms and conditions for these so-called “permanent qualified bidders.” 4 auction.” The circuit court then determined that when a party offers property for sale in an “absolute auction,” a contract is formed between the bidder and the auctioneer with every bid, until a higher bid is offered. In other words, the auctioneer’s advertising material was an offer from the auctioneer to sell the property at the price bid by the highest bidder, and the bidder accepted the offer and formed a binding contract with every bid. Additionally, the circuit court determined that the terms of the auctioneer’s offer are contained in the auction’s advertising materials, and that these terms are binding on the auctioneer unless there is an effective modification by the auctioneer. Once the auctioneer sets forth the terms of the auction in advertising, bidders may rely on those advertised terms in forming bids, and both the bidder and the auctioneer (and the seller for whom the auctioneer works) are bound by those advertised terms. Applying these rules to this case, the circuit court found that the defendant’s advertisements and catalog were “clear, unambiguous and undisputed,” and required bidders to make a 10% deposit of the minimum bid as well as provide a letter of credit guaranteeing that the bidder could complete the purchase. The circuit court found it was undisputed that the plaintiff met these pre-auction qualifications and that the other bidder, Mr. Lerch, did not. Accordingly, the circuit court found that a contract was formed between the plaintiff and defendant when the plaintiff properly bid $200,000 or more on the property, and the contract incorporated requirements that every bidder qualify by posting a deposit, presenting a bank letter of guarantee, and signing the bidder’s registration agreement. The circuit court then found that the defendant breached the contract when it 5 permitted someone who was not a qualified bidder to also bid on the property. As the sole qualified bidder, the circuit court concluded that the plaintiff should have been permitted to buy the property at the minimum required bid, that is, for $200,000. Because the plaintiff (as the winning bidder against Mr. Lerch) paid $265,000 after the conclusion of the auction, the circuit court ordered the defendant to repay the plaintiff $65,000 for the excess purchase price and $3,867.50 in excess auction commission fees, plus pre- and post-judgment interest. The defendant now appeals the circuit court’s April 5, 2018, summary judgment order.