The REINSW has released its best practice protocols in the wake of the Ma vs Francis court decision regarding what would constitute having conducted a proper auction and pass-in such that auction conditions apply to a contract made post-auction on the day of the auction.
It's important for all agents who utilise auctions to understand the implications of the court decision and what that means for them when confronted with a situation where we are negotiating with a single party only on auction day.
The quickest and simplest way to summarise the ruling is: if it looks like an auction, sounds like an auction, and has the key elements of an auction, then it was an auction and as such auction conditions will apply post-auction. The auctioneer standing up and announcing that the auction won't be conducted or that we are negotiating with an interested party is not sufficient to trigger auction conditions. The auctioneer must go through the motions of the auction and formally pass the property in to trigger auction conditions to apply post-auction.
To read the full best practice protocols, click the attached file.
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