I have been asked three times within the past month how to handle this type of dilemma.
What is giving rise to these situations? Frankly it is a combination of sloppiness , ignorance and entitlement. Some agents run roughshod over legalities. These are huge risks with consequences and what is particularly frightening is that many don’t even know they are taking these risks.
Let’s take the temperature of our current marketplace. These days potential problems tend to resolve themselves because ‘a rising tide floats all boats’ so to speak. It seems that everyone is pretty happy; frustrated buyers finally are securing their dream house, or at least some house; ecstatic Sellers are attaining prices they had never imagined.
However, let’s not become too smug, as you never have a problem on a deal until you have a problem.
Wise agents ensure every deal’s paperwork is executed as if storm clouds are seen on the horizon. If a problem never comes, it never comes. However, when it does, and believe me some day, some time (like Candid Camera) it will and when it does you will be mighty happy that your norm is to always take precautions on each and every transaction.
At least once in every Agent’s career a Buyer or Seller will take an offer to their lawyer and say ‘Get me out’. Every clause, notice, delivery and signature will be carefully scrutinized. If the lawyer hits pay dirt, whammy the deal is dead. Their client is happy and you might well be set for a lawsuit if you have erred. Lawyers know how to butter their bread and advise clients to ‘Go for the agent as they are insured’. Such nice guys.
Prudent agents at the outset make certain that conditional clauses have precisely timed conditional periods ( ….by 6:00 P.M. on such and such a date) and contain wording like “……failing which this agreement shall become null and void.” If the waiver, amendment or whatever is not delivered within its timeframe then the deal is dead. Period. At 6:01 in the above example there is no more deal. Done. Gone. Over. Expired. It has departed, like Monty Python’s parrott. It is at your own peril to accept the waiver and pretend it was delivered within the timeframe. Houston, we have a problem; the parrot has not been revived.
Now, what to do if the Buyer & Seller still want to do the deal but the waiver was delivered after expiry? Draft an amendment deleting the condition from the offer, inserting the following clause:
SAGE123 – AMENDMENT EXECUTED AFTER CONDITIONS’ EXPIRY
NOTWITHSTANDING THAT THE BUYER AND THE SELLER have executed this Amendment after expiry of the conditional period within the original Agreement of Purchase and Sale for the real property, the parties hereby agree to proceed with this transaction as if the Amendment had been executed prior to expiry of the original conditional period.
Then, one-two-three, knock knock knock, you have a firm deal that is sound and the lawyers can’t use that aspect to rescind the deal. Parrot revived. Know what I mean??
I like it. Hope you do too.
Keep those deals together.
Have very happy clients with deals destined to close and we all know the positive outcomes of deals that close — Booties for the baby.