What is Auction?

Legal Definition
An auction is a process of buying and selling goods or services by offering them up for bid, taking bids, and then selling the item to the highest bidder. The open ascending price auction is arguably the most common form of auction in use today. Participants bid openly against one another, with each subsequent bid required to be higher than the previous bid. An auctioneer may announce prices, bidders may call out their bids themselves (or have a proxy call out a bid on their behalf), or bids may be submitted electronically with the highest current bid publicly displayed. In a Dutch auction, the auctioneer begins with a high asking price for some quantity of like items; the price is lowered until a participant is willing to accept the auctioneer's price for some quantity of the goods in the lot or until the seller's reserve price is met. While auctions are most associated in the public imagination with the sale of antiques, paintings, rare collectibles and expensive wines, auctions are also used for commodities, livestock, radio spectrum and used cars. In economic theory, an auction may refer to any mechanism or set of trading rules for exchange.
-- Wikipedia
Legal Definition
Commerce, contract. A public sale of property to the highest bidder. Among the Romans this kind of sale, was made by a crier under a spear (sub hasta) stuck in the ground.

2. Auctions are generally held by express authority, and the person who conducts them is licensed to do so under various regulations.

3. The manner of conducting an auction is imaterial; whether it be by public outcry or by any other manner. The essential part is the selection of a purchaser from a number of bidders. In a case where a woman continued silent during the whole time of the sale, but whenever anyone bid she gave him a glass of brandy, and when the sale broke up, the person who received the last glass of brandy was taken into a private room, and he was declared to be the purchaser; this was adjudged to be an auction. 1 Dow. 115.

4. The law requires fairness in auction sales, and when a puffer is employed to raise the property offered for sale on bona fide bidders, or a combination is entered into between two or more persons not to overbid each other, the contract may in general be avoided. Vide Puffer, and 6 John. R. 194; 8 John. R. 444; 3 John. Cas. 29; Cowp. 395; 6 T. R. 642; Harr. Dig. Sale, IV.; and the article Conditions Sale. Vide Harr. Dig. Sale, IV.; 13 Price, R. 76; M'Clel. R. 25; 6 East, R. 392; 5 B. & A. 257; S. C. 2 Stark. R. 295; 1 Esp. R. 340; 5 Esp. R. 103 4 Taunt. R. 209; 1 H. Bl. R. 81; 2 Chit. R. 253; Cowp. R. 395; 1 Bouv. Inst., n. 976.
-- Bouviers Law Dictionary
Legal Definition
A public sale of land or goods, at public outcry, to the highest bidder. Russell v. Miner, 61 Barb. (N. Y.) 539; Hibler v. Hoag, 1 Watts & S. (Pa.) 553; Crandali v. State, 28 Ohio St 481. A sale by auction is a sale by public outcry to the highest bidder on the spot. Civ. Code Cal. § 1792; Civ. Code Dak. § 1022. The sale by auction is that which takes place when the thing is offered publicly to be sold to whoever will give the highest price. Civ. Code La. art. 2601. Auction is very generally defined as a sale to the highest bidder, and this is the usual meaning. There may, however, be a sale to the lowest bidder, as where land is sold for non-payment of taxes to whomsoever will take it for the shortest term; or where a contract is offered to the one who will perform it at the lowest price. And these appear fairly included in the term "auction." Abbott.
See also
-- Black's Law Dictionary
Legal Definition
A public sale to the highest bidder. See 131 Am. St. Rep. 479.
-- Ballentine's Law Dictionary