March 11th, 2019 at 1:58 pm

Question: I have always been told to stay away from an interim storage agreement that allows a buyer to move personal property into a home before the buyer acquires title to the property. However, I noticed that, as of December 2018, C.A.R. now has a standard-form Buyer Pre-Occupancy Storage Addendum (POSA). Can we go ahead and use this as part of our sales transactions?

Answer: No, it’s still a bad idea. C.A.R. drafted the standard-form POSA not because it approves its use. Instead, C.A.R. decided that, if a sales transaction must include pre-occupancy storage, it would be better to have a standard form for that purpose, rather than rely on the parties or agents to draft such an agreement. In fact, the bottom of the POSA specifically states in all-caps and bold font as follows: “Brokers do not recommend pre-occupancy storage. . . . If Buyer and Seller agree to pre-occupancy they are doing so against the advice of brokers and at their own risk.”

Those warnings are appropriate. The POSA is a very basic agreement that does not address various issues that may arise, including, but not limited to, removal of buyer’s contingencies, proof of buyer’s insurance before move-in, and injuries that may be sustained during the move. Moreover, if the purchase agreement falls apart and the buyer does not remove his or her things from the home as required, the seller could be held liable for throwing away the buyer’s things, rather than pursuing the seller’s legal remedies through the legal process. The bottom line is that so many things can go wrong with a pre-occupancy storage agreement that the risks may substantially outweigh the benefits.

-Thank you to Sandy Mathews (Ladera Ranch Office) for suggesting this week’s legal tip.

Copyright© 2019 Berkshire Hathaway HomeServices California Properties (BHHSCP). All rights reserved. Any unauthorized reproduction or use of this material is strictly prohibited. This information is believed to be accurate as of March 11, 2019. It is not intended as a substitute for legal advice in individual situations, and is not intended to nor does it create a standard of care for real estate professionals.

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