Negligent Auctioneer/Auction House Claims

Auctioneers, like many other professionals, owe a duty of care to both the buyers and sellers of any pieces they are in possession of. In the instance that this duty is breached, our professional negligence team may be able to help.

Common examples of auctioneer’s negligence

Below is a non-exhaustive list of some of the circumstances which may give rise to a negligence claim against an auctioneer:

  • Over-valuation;
  • Misdescription of the goods;
  • Physical damage to a good; or
  • Failing to correctly identify the origins or authorship of a good.

How can I prove that my auctioneer has been negligent?

In order to sue an auctioneer for negligence, a claimant must establish three essential elements to the civil standard of proof (on a balance of probabilities, i.e. it must be proved by the claimant that the financial adviser’s breach of duty caused the claimant to suffer loss).

1.Demonstrate that the auditor owed you a duty of care: the boundary lines between when a tortious duty of care is owed or not owed is subject to tests that are being continuously evolved by the courts. A duty of care exists where the auctioneer can be shown to have objectively assumed responsibility.

2. Establish that the auditor has breached the duty of care owed to you: proving breach will obviously vary depending on the individual circumstances of the case. A claimant needs to demonstrate that the breach shows that the auctioneer fell below the standards of a reasonably competent adviser in that speciality.

3. Prove that the auditor’s breach caused loss to you: you must prove both factual and legal causation. The test for factual causation is that “but for” the auctioneer’s breach you would not have suffered loss. Legal causation must also be proved i.e. the loss must be reasonably foreseeable at the time when the relevant duty was breached.

What is the time limit for commencing a claim against an auctioneer?

Time limits and limitation periods are essential to adhere to in litigation. Missing a limitation period is fatal to the chances of success of any claim and will leave a claim statute barred.

When it comes to ascertaining the limitation date for this type of claim, there are a number of factors to consider. In simple terms, the limitation period is six years from the accrual of the cause of action (section 2, Limitation Act 1980). However, if the six year time limit has passed but you have only just discovered the effect of any latent damage, then the limitation period may be extended to three years from the date of knowledge (section 14A, Limitation Act 1980).

If you have a complaint against an auctioneer, then our advice is that you take independent legal advice as soon as possible.

Advice for pursuing a claim against an auctioneer

Due to the nature of this work, the perception of auctioneers and their houses are vital for their success. Therefore, embarking on litigation in the first instance usually will not be the best course of action, as it may tarnish the public image of the auctioneer.

Maintaining discretion and avoiding publicity will build a far better relationship with the defendant and their legal team. In turn this may be conducive to obtaining a favourable settlement.

What evidence is required to bring a negligence claim against an auctioneer?

Where a professional negligence claim is brought/defended, the surrounding evidence will be critical. Early evaluation of the evidence is key, such evidence includes the retainer, correspondence with the professional, evidence of breach and proof of losses. Such loss can include proof that goods were sold at undervalue or mis-described (which may be subject to expert evidence)

When does the professional negligence PAP apply?

It applies to negligence claims against legal professionals, accountants, financial advisers, auditors and certain other professionals. However, it doesn’t apply to claims against construction professionals, (e.g. architects, engineers and quantity surveyors) as the Pre-action Protocol for Construction and Engineering Disputes is applicable instead. Nor against healthcare professionals (see the PAP for the Resolution of Clinical Disputes) or in defamation cases (see the PAP for Defamation Claims).

Letter of Claim to a negligent auctioneer

As soon as the claimant has decided that there are potential grounds for a professional negligence claim against an auctioneer, then it should send a Letter of Claim to the professional which amounts to a notice of intention to commence legal proceedings. It is recommended that the assistance of specialist professional negligence lawyers is sought for this correspondence as this is an important letter and if not handled correctly can lead to a reduced chance of obtaining a settlement or reduced prospects at trial especially if the subsequent Particulars of Claim (which is a statement of case) differs from the Letter of Claim in which case the court has the discretion to impose sanctions. The professional negligence pre-action protocol states that the Letter of Claim should include:

  • the identities of any parties involved in the dispute, or any related dispute (it is important to identify any and all correct defendants including successor entities before the limitation period expires);
  • a chronology containing key dates of the facts on which the claim is based, together with copies of all key documents;
  • reasonable requests which the claimant needs to make for documents held by or in control of the professional;
  • any details of the allegations made by the claimant against the professional;
  • an estimate of the financial loss caused to the claimant by the alleged negligence, including details of how the loss is calculated (in any claim this figure will likely be the subject of expert evidence, for example, consequential losses or loss of chance are difficult to quantify at the outset of a claim without expert evidence therefore an estimate will suffice at this stage, for example “in excess of £2 million”);
  • confirmation of whether or not an expert has been appointed (expert evidence is an important part of any claim in litigation and as experienced professional negligence lawyers we have forged many contacts with leading experts in different industries from forensic accounts to hedging derivatives experts);
  • a request that a copy of the Letter of Claim be forwarded on receipt to the professional’s indemnity insurers (if they have any);
  • an indication of whether you agree to refer the dispute to adjudication. If so, propose three adjudicators or seek a nomination. If you don’t wish to refer the dispute to adjudication, you should give reasons.

In addition, if the claimant has sent other Letters of Claim to any other party in relation to the same dispute or a related dispute, those letters should also be provided with the Letter of Claim.

Book an Initial Consultation with our Professional Negligence Lawyers

Do you have a claim against a professional? If you want expert legal advice, do not delay in instructing us so we can assess the legal merit of your case.

We can often take on such claims on a no win no fee basis (such as a Conditional Fee Arrangement) once we have discussed the claim with you and then assessed and advised you on the merits of the proposed professional negligence action.

Our expert legal team of leading Professional Negligence Solicitors & Barristers can provide urgent help, advice or representation to you. Just call our Professional Negligence Lawyers on 02071830529 or email us now.

Instruct Specialist Professional Negligence Solicitors

We are a specialist City of London law firm made up of Solicitors & Barristers operating from the only law firm based in the Middle Temple Inn of Court adjacent to the Royal Courts of Justice. Our team have expertise in advising on claims for compensation against professionals that have fallen below the standard expected, which causes clients financial or personal loss. We are experienced in bringing successful claims against negligent solicitors, barristers, financial advisers, surveyors, auctioneers, architects, tax advisers and IFAs.

Just fill out our simple enquiry form; it goes immediately to our litigation team in Middle Temple, London. You can also call our lawyers on +442071830529 from 9am-6pm.

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