Conducting auctions is a legitimate business that cannot be prohibited directly or indirectly[i].  The selling of merchandise at auction and the occupation of auctioneer are legitimate, lawful, and useful[ii].

However, the right to sell at auction is not absolute but may be withheld unless reasonable regulations are complied with[iii].  The source of the authority to regulate auctions is the police power and a regulatory statute adopted by virtue of the police power[iv].

The police power extends not only to the protection of the public health, safety and morals, but also to the preservation and promotion of the public welfare.  If a regulatory statute adopted by virtue of the police power does not have relation to public health, safety and morals they are void as an invasion of the property rights of any person affected by their enforcement[v].

The police power is not subject to any definite limitations, but is co-extensive with the necessities of the case and the safeguard of the public interests[vi].  Further, the police power is subordinate to constitutional limitations[vii].

However, a statute or a municipal ordinance which is fairly referable to the police power of the state or municipality and which discloses upon its face to have been enacted for the protection and in furtherance, of the peace, comfort, safety, health, morality, and general welfare of the inhabitants of the state or municipality, cannot be held invalid as wrongfully depriving the appellants of any right or privilege guaranteed by the Constitution[viii].

In Gatlinburg Art Gallery v. Gatlinburg, 215 Tenn. 107 (Tenn. 1964), the court held that the business of auctioneering is a legitimate subject of regulation to prevent abuses and frauds.  The power to regulate the sale of merchandise at public auction is not one of the incidents to a municipal corporation, and such powers can be exercised only when it has been conferred on a municipal corporation by the legislature[ix].

An ordinance which undertook to regulate the sale of personal property by auction within a city’s corporate limits was held to be a valid exercise of the city’s police power because its purpose was to protect the public and to minimize deception[x].

In Perry Trading Co. v. Tallahassee, 128 Fla. 424 (Fla. 1937), the court held that a city may not directly prohibit auction sales nor adopt such unreasonable or oppressive regulations as would indirectly produce such results.

While auction sales are subject to regulation under the police power they should be of such character as the circumstances and conditions require[xi].

[i] Steinberg-Baum & Co. v. Countryman, 247 Iowa 923 (Iowa 1956)

[ii] Blauvelt v. Beck, 162 Neb. 576 (Neb. 1956)

[iii] Steinberg-Baum & Co. v. Countryman, 247 Iowa 923 (Iowa 1956)

[iv] Gilbert v. Mathews, 186 Kan. 672 (Kan. 1960)

[v] Blauvelt v. Beck, 162 Neb. 576 (Neb. 1956)

[vi] Steinberg-Baum & Co. v. Countryman, 247 Iowa 923 (Iowa 1956)

[vii] Panhandle Eastern Pipe Line Co. v. State Highway Com., 294 U.S. 613 (U.S. 1935)

[viii] ABC Liquidators, Inc. v. Kansas City, 322 S.W.2d 876 (Mo. 1959)

[ix] Miller v. Greenville, 134 S.C. 314 (S.C. 1926)

[x] Jones v. Jackson, 195 Tenn. 329 (Tenn. 1953)

[xi] Perry Trading Co. v. Tallahassee, 128 Fla. 424 (Fla. 1937)