SB 474, as amended, Wieckowski. Auctions.
Existing law regulates the activities of auctioneers and auction companies and, on and after July 1, 2015, with respect to an auction that includes the sale of real property, prohibits a person from causing or allowing any person to bid at a sale for the sole purpose of increasing the bid on any real property being sold by the auctioneerbegin insert, including stating an increased bid greater than that offered by the last highest bidder was made when no person actually made an increased bidend insert. Existing law excepts from the application of these provisions a credit bid made by a creditor with a security interest in the property that is the subject of auction when the credit bid can result in the transfer of title to property to the creditor.begin insert Existing law provides that anyone who violates this provision is guilty of a misdemeanor.end insert
This bill would express the intent of the Legislature to enact legislation that would define the term “credit bid” as that term applies to auctions.
end deleteThis bill would eliminate that prohibition, but would, instead, prohibit an auctioneer from stating an increased bid greater than that offered by the last highest bidder was made when no person actually made an increased bid, as provided, and would eliminate the exception for credit bids. By expanding the crime of violating this provision to creditors making credit bids, this bill would impose a state-mandated local program.
end insertbegin insertThe California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
end insertbegin insertThis bill would provide that no reimbursement is required by this act for a specified reason.
end insertbegin insertThis bill would declare that it is to take effect immediately as an urgency statute.
end insertVote: begin deletemajority end deletebegin insert2⁄3end insert.
Appropriation: no.
Fiscal committee: begin deleteno end deletebegin insertyesend insert.
State-mandated local program: begin deleteno end deletebegin insertyesend insert.
The people of the State of California do enact as follows:
begin insertSection 1812.610 of the end insertbegin insertCivil Codeend insertbegin insert is amended
2to read:end insert
(a) Notwithstanding Section 1812.601, for purposes
4of this section, an auction includes the sale of real property and an
5“auctioneer” means any individual who is engaged in, or who by
6advertising or otherwise holds himself or herself out as being
7available to engage in, the calling for, the recognition of, and the
8acceptance of, offers for the purchase of real property at an auction.
9(b) begin deleteExcept as provided in subdivision (d), a person shall not
10cause or allow a person to bid at a sale for the sole purpose of
11increasing the bid on any real property being
sold by the auctioneer,
12including, but not limited to, stating any end delete
13state at an auction that an end insertincreased bid greater than that offered
14by the last highest bidderbegin insert has been madeend insert when, in fact, no person
15has made an increased bid.begin delete However,end deletebegin insert Notwithstanding the
16foregoing,end insert an auctioneer or another authorized person may place
17a bid on the seller’s behalf during an auction of real propertybegin insert that
18would not result in a sale of the real propertyend insert, if both of the
19following are
true:
20(1) Notice is given to all auction participants, including all other
21bidders, that liberty for that type of bidding is reserved and that
22type of bid will not result in the sale of the real property.
23(2) The person placing that type of bid contemporaneously
24discloses to all auction participants, including all other bidders,
25that the particular bid has been placed on behalf of the seller.
P3 1(c) For the purpose of the conduct of online auctions of real
2property, “notice” means a statement of the information required
3to be given under paragraph (1) of subdivision (b) within the end
4user license agreement, terms of service, or equivalent policy
5posted on, or provided by, the operator of an Internet Web site,
6online service, online application, or mobile application, and by
7conspicuously posting the information
required to be given under
8paragraph (1) of subdivision (b) in any of the following ways:
9(1) Upon the Internet Web page or its equivalent through which
10a user directly interacts with the site, service, or application during
11the online auction.
12(2) With an icon that hyperlinks to an Internet Web page or its
13equivalent upon which the required information is posted, if the
14icon is located on the Internet Web page or its equivalent through
15which a user directly interacts with the site, service, or application
16during the online auction. The icon shall use a color that contrasts
17with the background color of the Internet Web page or is otherwise
18readily distinguishable.
19(3) With a text link that hyperlinks to an Internet Web page or
20its equivalent upon which the required information is posted, if
21the text link is located
on the Internet Web page or its equivalent
22through which a user directly interacts with the site, service, or
23application during the online auction. The text link shall be written
24in capital letters that are in larger type than the surrounding text,
25or shall be written in contrasting type, font, or color to the
26surrounding text of the same size, or shall be set off from the
27surrounding text of the same size by symbols or other marks that
28call attention to the language.
29(4) With any other functional hyperlink or its equivalent that is
30displayed on the site, service, or application through which a user
31directly interacts with the site, service, or application during the
32online auction so that a reasonable person would notice it and
33understand it to hyperlink to the required information.
34(d) This section shall not apply to a credit bid made by a creditor
35holding a deed of trust, mortgage, or other lien on the property
36that is the subject of auction when the credit bid can result in the
37transfer of title to property to the creditor.
38(e)
end delete39begin insert(end insertbegin insertd)end insert This section shall be operative on July 1, 2015.
No reimbursement is required by this act pursuant to
2Section 6 of Article XIII B of the California Constitution because
3the only costs that may be incurred by a local agency or school
4district will be incurred because this act creates a new crime or
5infraction, eliminates a crime or infraction, or changes the penalty
6for a crime or infraction, within the meaning of Section 17556 of
7the Government Code, or changes the definition of a crime within
8the meaning of Section 6 of Article XIII B of the California
9Constitution.
This act is an urgency statute necessary for the
11immediate preservation of the public peace, health, or safety within
12the meaning of Article IV of the Constitution and shall go into
13immediate effect. The facts constituting the necessity are:
14In order to amend Section 1812.610 of the Civil Code before its
15operative date, it is necessary for this act to take effect immediately.
It is the intent of the Legislature to enact
17legislation that would define the term “credit bid” as that term
18applies to auctions.
19
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