Auction Seller's Name Can Be Kept Secret, Ruling Says

, New York Law Journal

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Russian Box
19th Century Russian silver/enamal covered box.

ALBANY - The State Court of Appeals reached back to an 1834 decision to determine that the successful absentee bidder on a 19th century Russian artifact cannot get out of his $400,000 bid just because the seller was identified by a number rather than a name.

In a 7-0 reversal of a unanimous holding of the Appellate Division, Second Department, the court found that Albert Rabizadeh cannot evade his bid.

It said the New York Supreme Court of Judicature, then the highest common law court in the state, made clear a century and a half ago that listing the name of the agent is sufficient (Hicks v. Whitmore, 12 Wend 548, 1834). The court also said the Statute of Frauds will not relieve Rabizadeh of his responsibility.

"It bears repeating in such a case as this that: 'The Statute of Frauds was not enacted to afford persons a means of evading just obligations,'" Judge Jenny Rivera (See Profile) wrote for the court in Jenack v. Rabizadeh, 229 (quoting Morris Cohon & Co. v. Russell, 23 NY2d 569, 1969).

The dispute centers on a "fine Russian silver/enamel covered box with gilt interior" that was expected to sell for $4,000 to $6,000 at an auction held in 2008 by William J. Jenack Estate Appraisers and Auctioneers in Chester.

Rabizedeh participated by telephone and successfully bid $400,000. But then he refused to pay for the box, arguing that the item auctioned by Jenack identified the seller only as "#428" and not by name. Janack sued for breach of contract.

Then Orange County Supreme Court Justice David Ritter in November 2009 granted Jenack summary judgment and, subsequently, Justice Catherine Bartlett (See Profile) awarded the auctioneer $402,398.

The Second Department reversed, holding that the identification of the seller as "#428" did not meet the General Obligations Law requirement for disclosure of "the name of the person on whose account the sale was made" (NYLJ, Sept. 21, 2012).

But the Court of Appeals said that the General Obligations Law "does not reference the 'seller,' making it clear that the seller's name need not be provided in order to satisfy the requirement of 'the name of the person on whose account the sale was made.'" The court said that Hicks v. Whitmore made plain that the name of the agent is sufficient to fulfill a disclosure requirement, and there is no question that an auctioneer is the consignor's agent.

"Using the Statute of Frauds as a means of evading a just obligation is precisely what Rabizadeh attempts to do here, but the law and the facts foreclose him from doing so," Rivera wrote.

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