The fall of Hammer may not Always Indicate that the Sale be Consummated as There can be Circumstances Where the Auctioneer Misinterpreted a Gesture as a bid, and Banged his Hammer

In Bullock v. Joe Bailey Auction Co., 580 P.2d 225 (Utah 1978), the action was brought to obtain specific performance of contract of sale of well drilling equipment after successful bid on such equipment was made on behalf of plaintiffs at auction and to restrain Auction Company from reclaiming equipment. Company counterclaimed for damages for issuance of wrongful restraining order and filed third-party complaint against surety. The District Court of Washington County dissolved restraining order, dismissed complaint, and awarded damages on counterclaim, and plaintiffs and surety appealed.
 
Pivotal findings of fact made by the trial court, which find support in the evidence, were:

1. That in connection with auctioning of the equipment in question the defendant announced that payment for any purchases made was a condition precedent to the consummation of any sale;
2. that the plaintiffs failed to meet that condition of the auction and were instructed that no sale had been consummated until the purchase price of the equipment for which they had bid was paid in full. Bullock v. Joe Bailey Auction Co., 580 P.2d 225, 229 (Utah 1978).

 The parties stipulated at the outset of the trial that the equipment was “struck off” at auction to Plaintiff and such being the case, the sale by auction was complete as a matter of law at the fall of the hammer. The Supreme Court held that, “[t]he main opinion states the proposition that a sale at auction is complete at ‘the fall of the hammer,’ apparently placing some reliance on U.C.A.1953, Section 70A-2-328. The court did not see that section as mandating any such conclusion. There is no magic to the ‘fall of a hammer.’ Whatever else the Uniform Commercial Code may do to our law, it does not repeal the fundamental concept, honored since ancient times, that in order to bind parties to a contract there must be a meeting of their minds in agreement thereon. It is undoubtedly true as indicated in the cases cited, that under appropriate circumstances where the auctioneer offers, and the bidder accepts, the fall of the hammer may indicate such an agreement and the sale be consummated. But there are obviously numerous circumstances where that would not be the result, including where the auctioneer misinterpreted a gesture as a bid, and banged his hammer; or where a bidder proves to be totally irresponsible.” Id.
 
The court further held that, “[t]he trial court could justifiably found and concluded as it did that there was a previously announced condition: that there would be no sale until payment was made, and that the defendant's indication of acceptance of the plaintiff's bid constituted but an executory contract which required payment of the purchase price before the sale was complete. Consequently neither title to, nor the right of possession of, the equipment passed to plaintiff until he made such payment.” Id at 230.