For machinery, I'd guess that that argument and 50 cents would buy you a cup of coffee.  There's no requirement other than their own moral decency that says that they can't stand up there and tell you whatever they want.  It's just like any other used item, you bought it used, and unless you got a written warranty, you're going to have a hard time getting anything else, regardless of what lies were told.  That being said, I don't think many auctioneers would trash their own reputations by outright lying about an item. 

Mike