Eric wants to sell his house, and Bob wants to buy it, so he puts in an Offer conditional on the sale of his own house.
Escape Clause
Eric adds the following clause to the Agreement of Purchase and Sale:
“Provided further that the Seller may continue to offer the property for sale and, in the event the Seller receives another Offer satisfactory to the Seller, the Seller may so notify the Buyer in writing by delivery to the Buyer personally or in accordance with any other provisions for the delivery of notice in this Agreement of Purchase and Sale or any Schedule thereto. The Buyer shall have ________ hours from the giving of such notice to waive or remove this condition by notice in writing delivered to the Seller personally or in accordance with any other provisions for the delivery of notice in this Agreement of Purchase and Sale or any Schedule thereto, failing which this Offer shall be null and void, and the Buyer’s deposit shall be returned in full without deduction.”
When does Eric actually give notice?
The clause permitting the Seller to switch from Buyer #1 to Buyer #2 can be done at anytime.
Hence, do it now, if you are trying to get rid of them, or wait until the weekend is over, if you want to keep them. Bob will need to check with his bank to ensure that he has the money in order to firm up.
Sometimes, they will simply take the risk and firm up.
There’s actually no time limit in terms of the start.
The Seller can negotiate for several weeks with Buyer #2 until they finally reach a point where their Offer is acceptable to the Seller.
So, that could mean Buyer #2’s Offer is conditional upon financing and inspection. Both those conditions are waived or satisfied and now, Buyer #2’s Offer is unconditional. At this point, their Offer is satisfactory to the Seller, and consequently, the Seller will then give “Notice” to Buyer #1.
This particular clause as drafted provides Eric, the Seller with a great deal of flexibility.
Brian Madigan LL.B., Broker