AUC'TION (Lat. nuctio, increase, public sale by increased bids. from ungere, increase). A public sale of property to the highest bidder. Ordinarily, the property offered for sale is de scribed, and the conditions in accordance with which it will be sold are announced, before bids are invited. Each bid is an offer, the auction eer's acceptance of which is indicated by his knocking down the property to the bidder. Until the bid is thus accepted it may be withdrawn; but when thus accepted a contract is formed between the seller and the buyer, containing as a part of its terms all statements and conditions publicly made to the bidders on the seller's be half. An auction should be fairly conducted en both sides. There should be no pulling, or bidding by dummies, in the interest of the seller, nor should he be allowed to hid unless he has stipulated for that right in the conditions of the auction, or the right is accorded to him by statute, or by an order of court having control of the sale. On the other hand, any concerted action by bidders for stifling the sale is ille gal, and may warrant the auctioneer in refus ing to accept bids; it may even entitle the seller to avoid a sale.
The conduct of auctions is regulated, with a good deal of care, by modern statutes, in Eng land and in many of our States. Not infre quently sham auctions are declared to be crim inal offenses. As a rule, an auctioneer must. have a license, either from the State or the municipal authorities. While engaged in bring ing the property to a sale, he is the agent of the seller only. His power to bind the principal, and the principal's authority over him, as well as their respective duties to each other, are de termined by the general principles of agency. As soon as the sale is made, he becomes an agent of the purchaser, as well as of the seller, for the purpose of making a memorandum of the sale which will satisfy the statute of frauds. This
agency does not continue, however, beyond a reasonable time for the performance of that duty. The auctioneer has a lien on his prin cipal's goods in his possession, and on the pro ceeds from their sale, to the extent of his com missions and expenses. Because of this interest in the property, he may sue in his own name for the purchase price, or for the wrongful con version of the property by a third person. If he sells without disclosing his principal, he may be sued by the purchaser for any breach of the contract. Even though he names his principal, he will not always escape liability, though he follows strictly the principal's direc tions. If, for example, he in good faith sells property as that of the principal and turns the proceeds over to the latter. he will be liable for a conversion to a third party who owned and was entitled to possession of the property.
In a 'Dutch auction,' the property is offered at a high price, which the auctioneer lowers gradually, until a price is named which is ac cepted by the bidder. Here the offer is by the auctioneer and the acceptance by the bidder. An auction sale 'by inch of candle' is when the biddings are to be kept open only while a stipulated length of candle burns. These two forms of auction are practically obsolete in England and the United States. See Bateman, Treatise on the Law of Auctions (first Ameri can edition, Boston, 1883) ; seventh English edi tion, London, 1895) ; also the works referred to under AGENT.