Auctions Gone Awry: Public Disclosure is Sadly Lacking and No One is Held Accountable
One month ago, in the pages of the newspaper “Hayastani Hanrapetutyun”, we came across an advert announcing that an auction of farm equipment, tools, and cars belonging to the community of Tretuk, Gegharkunik Marz, was to take place on May 19. The announcement included the deadline for applications and details regarding contacting the community municipality and a cell phone number. The announcement was signed by the community mayor.
Even thought the time of the auction wasn’t specified in the announcement we arrived in Tretuk at 11:00 am on May 19. There were no notices about the auction at the municipal office. The law stipulates, however, that the auction organizers must post public information about the event at least one day before at the site where it is to take place.
When we asked when the auction was to start Silva Abrahamyan, the deputy community leader of Tretuk, told us the sale would start at noon. She said that they had received two bid applications from local residents. One was from her son, Mikhayil Abrahamyan and the other from Karo Asatryan. She said that the farm equipment to be auctioned off was quite old. In the case of one of the tractors, she said that they had been using it for the past twenty years and had repeatedly petitioned the community leader to hand over the property rights to them. She phoned the community head to get more specific information and to also ask if he was to show up at work or not. Fifteen minutes later, however, she told us not to wait for the village mayor. He had supposedly phoned and said that the auction would be postponed till May 21 since there were no registered bidders.
The mayor describes his deputy’s statements as “gossip”
We decided to wait and get an explanation directly from him. One hour later, Suren Yeghiazaryan, the community mayor arrived and told us that today’s auction was being cancelled since there were no registered bidders. When we told him that his deputy had given us different information Mr. Yeghiazaryan shrugged it off as mere village gossip. He said that Silva Abrahamyan’s son was in Russia and couldn’t possibly participate in the auction. We asked if it was fair and proper of him to label his deputy’s information as mere “gossip” and proposed that Mrs. Abrahamyan be present at our conversation. Mr. Yeghiazaryan declined, saying that he saw no need for such a meeting.
It is stipulated in the RoA “Bargains Law” that a public notice must be posted regarding all auctions. The law specifies that eleven pieces of information must be included in said notice. Most, if not all, were absent in the notice compiled by the Tretuk municipality. The following points were missing in the Tretuk notice
1) Time of the auction
2) Title of the auction organizer
3) Address of the auction organizer
4) Auction rules and procedure
5) Auction conditions; including lot titles and descriptions. If the lot to be bided on is an object, its physical condition (wear and tear) and manufacture date. The starting bid price and other essential details.
Mr. Yeghiazaryan agreed that the auction notice was flawed. He told us that there were four lots up for auction – two tractors with a start bid of 419,000 and 312,000 drams, a 219,000 dram dump-truck, and a 22,000 dram trailer. All weren’t included in the notice since they were quite old, remnants of the collective farm era. Mr. Yeghiazaryan described them as nothing more than junk metal.
The issue of auctioning off the community’s remaining farm equipment was taken up at the March 26 session of the community council. The session is duly registered in the council logs. Mr. Yeghiazaryan told us that a public advisory meeting was held on May 5 and that local residents were informed about the upcoming auction. A five-member auction committee was set up as well. To bolster his argument that the auction was well advertised, Mr. Yeghiazaryan said the community receives eleven copies of the “Hayastani Hanrapetutyun” newspaper. The municipality has a subscription to three copies and the mayor personally gets one of them. As to where potential bidders must get information about the lots for sale and auction fees, the answer is the same; from the community mayor. Potential bidders were forced to either make their way to the village of Tretuk or Metz Masrik, where Mayor Suren Yeghiazaryan resides, or to call him at the cell phone number provided in the notice.
When a public notice offers little or no information
It is no wonder then that all roads leading to auction information starts and ends with Mayor Yeghiazarayan, who, by the way, is also the president of the auction committee. However, the committee president wasn’t able to provide potential bidders with a specific entrance fee, since he thought that the fee should be 10% of the valuation of each lot up for bid. The RoA “Bargains Law” states that the entrance fee must not exceed the starting bid on the most expensive lot up for bid by 5%. The mayor couldn’t even say what the minimum incremental bids were to be, arguing that this detail would be decided during the auction.
We requested to see a copy of the auction regulations but the mayor said it was locked away in somebody’s fire-proof safe and that the owner was away on business. When we asked if we could see the community’s budget, the mayor claimed that it too was locked away in the same safe.
Mr. Yeghiazaryan told us that the auction committee was to meet at 3:00 pm that same day to officially register the fact that the auction had been called off. However, according to Article 15 of the RoA “Bargains Law”, this procedure should take place the following day.
Most probably, this isn’t the first or last auction to be cancelled. The question remains, what good is publicizing an auction if it offers little or no information to prospective bidders? Then too, who is to be held accountable for the fact that the public notice posted by the Tretuk municipality regarding the auction was so flawed? Whose duty is it to see that the auction laws are observed if there aren’t citizens who come forward as prospective bidders and demand a full accounting as prescribed by the law?
If there are bidders then, by extension, there is no one to complain about the auction process. In the end, things will remain as they are. The mayor will reprimand his deputy for carelessly divulging “internal information” and come the next auction that same deputy will be less than forthcoming with the facts.
If you found a typo you can notify us by selecting the text area and pressing CTRL+Enter
Videos
Photos
Write a comment