This is a mixture of a bug (somewhat) and feature request. At the moment, it's fairly easy to auction off almost completely broken tools for an inflated value as it is impossible to see an item's wear in an auction.
This probably keeps experienced players from buying tools in auctions and is a great way to make money before learning the Tinkering skill, as one can easily sell an almost useless tool for a perceived low price (I've done it a couple of times...)