Step 6: (Optional) Identify heirlooms that shouldn't be sold to others.
There may be items on your list that you want to keep in the family. Identify these items as "heirlooms," and let the recipients know that the winning bidder must promise not to sell these items to an outside party.
Example: The Sniders want to keep the piano and a ceramic figurine in the family.
Classifying something as an heirloom can favor one recipient over the others. Let's say that Mary Snider is the only recipient who plays the piano, and the Sniders' piano has a market value of about $500. If the piano can be sold, then the other bidders will likely bid an amount close to $500. That makes things fair, since if Mary's the winning bidder, she'll be "charged" roughly $500. But if the other bidders aren't allowed to sell the piano, then they might bid low amounts, allowing Mary to win it for much less than its market value. To keep things fair, it may be best to "entitle" Mary to the piano (see Step 7) and offer it to her at the appraised value. But that solution might not work. Here's why:
Entitling a recipient to an heirloom creates an opportunity for him or her to act in bad faith. Suppose that Mary knows that the other recipients don't want the piano and that they're unlikely to bid very much for it. She might, therefore, be tempted to decline the item at the appraised value so that it will be put up for auction. That way, she can get the item for the second highest bid price, which may be much lower than the appraised value. If you believe that a recipient has declined an heirloom that's offered at the appraised value because he or she hopes to acquire it at a lower price, then it may be best to lift the restriction that it not be sold to an outside party. Alternatively, you may consider amending the rules to force all entitled recipients to accept heirlooms at their appraised values.
Go to Step 7
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Copyright © 2004 Lori Alden. All rights reserved.