A Queensland agent engages in 'dummy bidding' at an auction by arranging for a friend to place false bids to drive up the price. This conduct is:
Correct Answer
D) Unlawful, as an undisclosed bid for the seller and misleading conduct toward bidders
A bid made on the seller's behalf counts as a seller bid under the Property Occupations Act 2014 (Qld). It is allowed only if the conditions of sale reserve the seller's right to bid, and the auctioneer must disclose to other bidders that it is a seller bid and cannot accept one above the reserve. A friend placing disguised bids breaks those rules, is misleading conduct under the Australian Consumer Law, and exposes the agent to disciplinary action; a contract made in breach of the seller-bid rules can also be voidable by the buyer before settlement.
Why This Is the Correct Answer
Bids placed for the seller must be reserved in the conditions of sale and disclosed as seller bids. A friend posing as a buyer to push the price up is an undisclosed seller bid and deceives genuine bidders, which is misleading conduct.
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