Warlow v Harrison

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					                              Warlow v Harrison
             (1859) 1 E & E 309; 120 ER 925 (Exchequer Chamber)
The defendant, an auctioneer, advertised the sale without reserve of a horse by public auction. The plaintiff
attended the sale and bid 60 guineas. The horse's owner bid 61 guineas. The plaintiff refused to make any
further bid and the defendant (who, it appears, did not know that the bidder was the owner) knocked down
the horse to the owner for 61 guineas. The plaintiff claimed that the horse was his since he was the highest
bona fide purchaser at an unreserved sale. In his pleadings the plaintiff alleged that the defendant was the
plaintiff's agent to complete this contract. Held: on the pleadings the plaintiff had no claim since there was
no agency relationship between the plaintiff and the defendant. The pleadings required amendment.

MARTIN B (obiter):... The sale was announced.., to be 'without reserve.' This, accordin to all the cases
both at law and equity, means that neither the vendor nor any person in his behalf shall bid at the auction,
and that the property shall be sold to the highest bidder, whether the sum bid be equivalent to the real value
or not. We cannot distinguish the case of an auctioneer putting up property for sale upon such a condition
from the case of the loser of property offering a reward ....
Upon the same principle, it seems to us that the highest bona fide bidder at an auction may sue the
auctioneer as upon a contract that the sale shall be without reserve. We think the auctioneer who puts the
property up for sale upon such a condition pledges himself that the sale shall be without reserve; or, in
other words, contracts that it shall be so; and that this contract is made with the highest bona fide bidder;
and, in case of a breach of it, that he has a right of action against the auctioneer.

There were two agreements. First, the plaintiff's bid was an offer, but since his bid was not accepted he was
not entitled to the horse which was knocked down to the owner. However, the advertisement of an auction
sale without reserve is a unilateral offer by the auctioneer. Martin B indicates that only the highest bona
fide bidder can accept this unilateral offer. The plaintiff clearly accepted this offer and the auctioneer would
be liable in damages for breach of his promise that there would be no reserve.

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