No Deal: no acceptance
This question is directed to the failure to authorize Designated Representatives to give and receive various Documents under the standard form Agreement of Purchase and Sale.
In most transactions today, and I am estimating at least 90%, one of the parties, either the Buyer or the Seller has a Designated Representative under Form 271 or 371. Unfortunately, the standard Form APS was not amended so as to enable them to give and receive notices and documents on behalf of their clients.
The biggest risk: we might not have “acceptance”.
That would be absolutely perfect for a Buyer who has “buyer’s remorse”. Don’t worry about conditions related to financing and inspections. Don’t bother to consider the “good faith” obligations that go along with signing a contract.
There was no contract, just an Offer, that never, ever got accepted.
The purported “acceptance” was communicated to John Smith your Designated Representative under Form 371. John does work for ABC Realty, and you did authorize ABC Realty to accept notices and documents, BUT, that was ONLY if you had appointed them as your agent under Form 300. You didn’t. They have no authority. And, you have yet to delegate that authority to John Smith.
What a nightmare for the Seller.
As long as the Buyer never does anything which could be considered by the Courts as affirming the transaction, then the Buyer has an out, a big “OUT”.
There simply was no communication of acceptance within the irrevocable time limit.
That means we have an expired Offer. We never got to a contract!
So, where do you want to put that for future deals?
Consider using the Confirmation of Cooperation and Representation. Amend it with a Schedule “A” in order to ensure that this delegation of authority is made upfront. This means that the Seller can use John Smith’s email address. Perfect, that’s just exactly what they wanted to do.
Brian Madigan LL.B., Broker