Rule 71 Failure to Complete Sale

COMMENTARY:

If a bidder fails to complete a sale, this rule requires the bidder to pay the expenses incurred in going through the confirmation of sale process. In addition, the court may assess additional damages to make the estate whole and to discourage fraudulent bidding efforts, such as where a person who cannot satisfy a bid raises the price in an effort to scare off other bidders and then seeks to purchase the property at a lower price later, or where a speculator seeks to setup a back-to-back sale and plans to walk away from the purchase if the other buyer does not come through.

Once a sale falls through, the personal representative may then reoffer the property for sale. Backup bids are not accepted in the confirmation of sale process because so much time can elapse between the time of the confirmation hearing and the eventual closing of the sale, and market conditions can change. The attorney should be certain to include the forfeiture provision (subject to further order of the court) in the order confirming sale.