The Probert Encyclopaedia of Money

AUCTION

An auction is a method of sale in which goods are sold in public to the highest bidder.
Auctions are used for any property for which there are likely to be a number of competing buyers, such as houses, second-hand and antique furniture, works of art, etc., as well as for certain commodities, such as tea, bristles, wool, furs, etc., which must be sold as individual lots, rather than on the basis of a standard sample or grading procedure.

In most auctions the goods to be sold are available for viewing before the sale and it is usual for the seller to put a reserve price on the articles offered, i.e. the articles are withdrawn from sale unless more than a specified price is bid. The auctioneer acts as agent for the seller in most cases and receives a commission on the sale price. An auctioneer who declares himself to be an agent of the seller promises that he has authority to sell and that he knows of no defect in the seller's title to the goods; he does not, however, promise that a buyer will receive good title for a specific object. An advertisement that an auction will be held does not bind the auctioneer to hold it. It is illegal for a dealer (a person who buys at auction for subsequent resale) to offer a person a reward not to bid at an auction.
Research Auction