They keep coming up. People just don’t understand the law or are too cheap to retain a lawyer to draft up clauses for their Brokerage.
“In the event no deposit is received by the Listing Brokerage’s office by the next business day following the date of acceptance of this Agreement of Purchase and Sale, the Seller shall have the option to exercise his right to unilaterally declare this Agreement of Purchase and Sale null and void, at which time the Seller shall be at liberty to accept a new offer, in the absence of a Mutual Release executed by the Buyer.”
“In the event no waiver(s) signed by the Buyer arrived at the Listing Brokerage’s office within the time limit for each and every condition provided herein, as evidenced by the Seller’s or his agent’s acknowledgement otherwise, the Seller shall exercise his right by virtue of the condition, to unilaterally declare this Agreement of Purchase and Sale null and void, at which time the Seller shall be at liberty to accept a new offer, in the absence of a Mutual Release executed by the Buyer.”
The Deposit Clause
This clause adds confusion. The rights of both parties were clear under the OREA’s contract, but now they have just become “fuzzy”. Does the Seller have to wait an extra day? Does the Seller have to wait an extra “business day”? And why would you want to have the right to declare the APS “null and void”? The Seller was entitled immediately to accept a second Offer, They were also entitled to sue for the deposit on the first deal. However, that’s no longer the case. And, to think that the Listing Brokerage added this to “protect” their own Clients. I think this is just plain negligence on their part.
The Waiver Clause
Obviously, they have never heard of a Condition Subsequent or a True Condition Precedent because this clause applies to them as well. Also, Waivers and Notices of Fulfillment both work for regular Conditions Precedent, but this clause only covers waivers. And, the Seller and/or the Seller’s agent have to acknowledge them. What if they don’t? What if their internet is down or they just don’t even bother to send out an Acknowledgement? Again, the failure to deliver on the part of the Buyer may not have been in “good faith” meaning the Seller has legal rights! Why would the Listing Brokerage want to take them away? It seems like the Listing Brokerage is totally unaware of their own Client’s legal rights! Again, negligence drafting this up in my opinion.
Brian Madigan LL.B., Broker