Because auctioneers move quickly, winning bids cannot be cancelled, and items are usually sold “as-is” with no return policy, it is imperative that auction buyers perform due diligence prior to the sale so they are completely prepared the moment their lots come up for auction. Willow Fine Arts simplifies the auction buying process from start to finish. We begin by working with our client to identify artworks that complement or fill holes in their collection. Our firm then sources the items from reputable auction houses, confirms condition statements, registers the client for the auction sale, provides expert insights on maximum bids, researches guarantees and reserve prices, obtains phone or absentee bids, completes post-sale paperwork, and arranges for collection and shipment.

When selling at auction it is important to choose a reputable auction house with proven expertise in selling similar items. Prices rise when competition heats up between two or more bidders, so consignments should be included in a sale that will reach a large audience of bidders looking for items similar to the consignment. As an extreme example, it would be a mistake to consign an important piece of postmodernist Memphis design to an auction of primarily Art Nouveau furniture. The buyers in the audience would be Art Nouveau collectors who would not compete to win the Memphis piece; the tepid competition would result in a lower hammer price. In addition to ensuring our clients are set up for a successful sale day, Willow Fine Arts also negotiates best consignment terms with auction houses, reviews proposed auction estimates and pre-sale contracts, arranges for collection, and monitors the sale process. The auction process is filled with specific terminology that new and seasoned buyers and consignors may find confusing. Willow Fine Arts compiled a selection of terms that are commonly used by mainstream auction houses:

Guarantee: This is usually reserved for very high-value artworks. A “guarantee” is a term for a specific amount of money the auction house agrees to pay the consignor, even if the artwork does not sell in the auction. This amount is agreed upon prior to the auction. The guarantee provides the consignor with the peace of mind that their multi-million dollar consignment will sell for a high price, even if the auction happens to fall on a bad day. Auction houses will typically disclose which lots have a guarantee in the auction catalog. This is a simplified explanation; for more information, we suggest reading this artnet article.

Hammer price: The winning bid price as the auctioneer’s hammer falls. It does not include the buyer’s premium, applicable taxes, or VAT

Lot: An object or a group of objects being auctioned as a single unit.

Phone Bid: The auction house will call a bidder during an auction and will relay bids on their behalf. Also called a “phone line.” This gives a bidder more control over the outcome of the auction than placing an absentee bid, and can be a successful alternative to attending the auction in person.

Title: Also known as Legal Title, the act of having full legal ownership and interest in the work of art you possess. Checking for a clear title is important because it is possible for an artwork (and other assets) to be owned by one party but subject to a legal claim by another, called an encumbrance. Titles can be encumbered by liens, theft, probate disputes, divorce disputes, unpaid taxes, bankruptcy, creditors, and customs violations. For more information on legal title as it pertains to personal property, see Spencer’s Art Law Journal, “Art Buyers’ Due Diligence: Do you Own it Free and Clear?”

This article is intended to be an educational primer for our clients and is not by any means an exhaustive list of auction terminology. It is also important to note that certain auction houses interpret specific auction terms in their own manner.

If you have questions about the auction process or are interested in our services, please contact Willow Fine Arts to schedule a consultation. We look forward to meeting you and learning more about how our services will fit your individual needs.