Going, going, goner in house auction

Jan 4 2009 by Mr Justice, Sunday Sun

A ROW broke out between estate agent Keith Pattinson Ltd and seller Steven Emerson-Lancaster over a house auction.

Keith Pattinson Ltd are demanding £2350 in fees plus costs and interest. But Steven has refused to pay.

The house did not reach its reserve price at auction but the bidder was approached by Keith Pattinson Ltd afterwards to make an offer.

However, Steven claims in defence papers, the bidder pulled out of the deal when he realised the auctioneer had been bidding up.

Bidding up is a practice used by auctioneers to bump up the price of a property.

It is perfectly legal but any bidding up must not occur after the property reaches its reserve price.

The same buyer later came to a private arrangement with Steven.

In documents before Newcastle County Court, Keith Pattinson Ltd claim they are still entitled to the sales fee.

Steven, of Sacriston, County Durham, said: “The auction went ahead. Then I had a phone call saying a possible buyer was no longer interested because he found out there had been some bidding up.

“Weeks later, the buyer contacted me and made a private offer, which I accepted.

“I do not think I should have to pay the sales fee.”

I put the complaint to Keith Pattinson Ltd. A spokeswoman for the company confirmed the property was subject to bidding up.

She said: “On the night of the auction the property did not reach its reserve.

“In order to generate interest in a property, and to achieve a sale, the auctioneer occasion- ally ‘bids up’, although we would stress that we would not do so over the reserve of the property.

“In this instance, the auctioneer attempted to get an increased offer but, as the bidder did not increase his offer to the reserve, the property was withdrawn.”

She said an approach was made to the bidder after the auction to see if a price could be negotiated.

She said a price was discussed and, although they were willing to proceed, there was a stumbling block over payment of a deposit.

She went on: “It is disappointing that Mr Emerson-Lancaster has approached yourselves, presumably complaining with regard to the service he received from ourselves.

“Ultimately, we see this as a positive result for Keith Pattinson Ltd.

“We entered a property into the auction and, as a direct result of our marketing, introduced a purchaser.

“It is disappointing that the parties chose to instruct the sale through solicitors privately.

“Clearly, we feel that we are entitled to our fee in full hence, having been unable to reach a settlement out of court, we were left with no option but to sue Mr Emerson-Lancaster.”

It is now, of course, up to the courts to come down on the side of Keith Pattinson Ltd or Steven Emerson- Lancaster when the case reaches my learned friends.