Hi All,
Acey is correct here, in NSW anyway.
Once the reserve has been passed at auction you are, as the highest bidder, obligated and required to complete the sale. Your winning bid is a legally binding contract.
If you listen to the auctioneer prior to the auction he/she will clearly state that the winning bidder is the purchaser and obligated to the purchase. The auctioneer is required by law to make this statement along with the rest of the ramble he makes about vendor bids etc etc.
If you do not sign a contract on the night the auctioneer or agent has the power to sign it on your behalf. I have signed contracts on behalf of vendors and purchasers many times at auctions.
I've heard of one instance where the purchaser couldn't complete and had to go bankrupt in order to avoid settling on the purchase.
I heard another example where an agent placed a dummy bidder in the audience. The auctioneer placed the property on the market and the dummy didn't hear it and continued to bid, and ended up being the highest bidder, legally obliged to buy the property. The situation was resolved by the agent explaining the situation to the vendor, then commencing negotiations with the underbidder, who ended up purchasing for $5k less.
I've also heard of people who are the eventual purchasers run away after the auction is over, and no one not knowing who he/she is, so the property will need to be reauctioned or negotiations with the underbidder commenced.
Oral bids are accepted.
In some states registration prior to the auction is required.
Also, if a property is auctioned and passed in, but you go and buy the property before midnight on the day of the auction, auction conditions still apply, ie no cooling off period, even though you did not succeed at the auction.
Hope this helps.