J. MILLARD TAWES, Governor                        811

(c) complies with the filing provisions of the Sub-title on Secured
Transactions (Sub-title 9).

(4) Any "or return" term of a contract for sale is to be treated
as a separate contract for sale within the statute of frauds section
of this Sub-title (Section 2—201) and as contradicting the sale aspect
of the contract within the provisions of this Sub-title on parole or
extrinsic evidence (Section 2—202).

2—327. Special Incidents of Sale on Approval and Sale or Return.

(1)   Under a sale on Approval unless otherwise agreed

(a)  although the goods are identified to the contract the risk of
loss and the title do not pass to the buyer until acceptance; and

(b)  use of the goods consistent with the purpose of trial is not
acceptance but failure seasonably to notify the seller of election to
return the goods is acceptance, and if the goods conform to the con-
tract acceptance of any part is acceptance of the whole; and

(c)  after due notification of election to return, the return is at the
seller's risk and expense but a merchant buyer must follow any rea-
sonable instructions.

(2)   Under a sale or return unless otherwise agreed

(a)  the option to return extends to the whole or any commercial
unit of the goods while in substantially their original condition, but
must be exercised seasonably; and

(b)  the return is at the buyer's risk and expense.

2—328. Sale by Auction.

(1)  In a sale by auction if goods are put up in lots each lot is the
subject of a separate sale.

(2)  A sale by auction is complete when the auctioneer so announces
by the fall of the hammer or in other customary manner. Where a
bid is made while the hammer is falling in acceptance of a prior bid
the auctioneer may in his discretion reopen the bidding or declare
the goods sold under the bid on which the hammer was falling.

(3)  Such a sale is with reserve unless the goods are in explicit
terms put up without reserve. In an auction with reserve the auc-
tioneer may withdraw the goods at any time until he announces com-
pletion of the sale. In an auction without reserve, after the auc-
tioneer calls for bids on an article or lot, that article or lot cannot
be withdrawn unless no bid is made within a reasonable time. In
either case a bidder may retract his bid until the auctioneer's an-
nouncement of completion of the sale, but a bidder's retraction does
not revive any previous bid.

(4) If the auctioneer knowingly receives a bid on the seller's be-
half or the seller makes or procures such a bid, and notice has not
been given that liberty for such bidding is reserved, the buyer may
at his option avoid the sale or take the goods at the price of the last
good faith bid prior to the completion of the sale. This sub-section
shall not apply to any bid at a forced sale.