A third edition of the Common Auction Conditions (CAC) has been published by RICS on 30 July 2009 introducing a revised bidding practice. The Common Auction conditions provide auctioneers with model rules which form the basis of sales by auction.
Policy underlying the change
There are three core factors underpinning the introduction of the CAC third edition:
1. Level playing field: The previous CAC were biased towards sellers. The third edition is introduced to slightly tip the balance to ensure that the interests of both the seller and purchaser are represented in sales by auction.
2. Reducing costs: This is to be achieved by having one clear document incorporating all sale terms which both parties can comprehend and use with ease.
3. Convenience: By offering auctioneers across England and Wales a common set of conditions that will be familiar to all the auction experience will be easier, more pleasant and user friendly for purchasers and sellers.
Examples of changes
1. Amended general conditions of sale include:
• An obligation on the seller to insure the property from the date on which contract is entered until completion,and
• Removal of financial charges from matters to which the property is subject.
• A full indemnity to the seller from the purchaser in respect of anything to which the property is subject and that may leave the seller open to liability.
2. Changes to some of the terms to bring them in line with definitions used in private treaty sales.
3. New terms introduced to control the practice relating to “guide prices” and “bidding”.
For further information or for Commercial Property enquiries please contact Sylvia Abaleke at sabaleke@steeleslaw.co.uk or telephone 020 7421 1720.