March 18th, 2019 at 2:33 pm

Fact Pattern: A seller and buyer are in a pending sales transaction. The timeframes for the buyer’s contingencies have all expired. On Monday, March 11, 2019, at 8:30 p.m., the listing agent emails to the buyer’s agent a 2-day Notice to Buyer to Perform (NBP) to remove all contingencies. The buyer’s agent, however, does not actually receive the email until the next day, Tuesday, at 9 a.m. The buyer’s agent confirms receipt of the NBP at 9:10 a.m.

Multiple Choice Question: What is the deadline for the buyer to remove all contingencies to prevent the seller from cancelling? Pick the best answer:

A. Wednesday, March 13, 2019, at 8:30 p.m.
B. Wednesday, March 13, 2019, at 11:59 p.m.
C. Thursday, March 14, 2019, at 9:00 a.m.
D. Thursday, March 14, 2019, at 9:10 a.m.
E. Thursday, March 14, 2019, at 11:59 p.m.

Answer: Answers A and B are wrong. Under paragraph 14E of the C.A.R. Residential Purchase Agreement (RPA), a buyer has 2 “Days After Delivery” of an NBP to remove all contingencies. Paragraph 30 of the RPA specifically defines the word, “Delivery,” to mean, in our situation, “personal receipt” by the buyer’s agent. Under that definition, the date and time that the listing agent sent the email is generally irrelevant. The proper date to use to start counting the 2 days is when the buyer’s agent personally received the NBP. That occurred on Tuesday, March 12. Two days after March 12 is March 14 (not March 13).

Of course, it’s possible that the buyer’s agent is merely pretending that the NBP was not received until the next day. To avoid that possibility, the listing agent should have called the buyer’s agent on Monday evening to confirm receipt. Otherwise, without knowing more, it seems reasonable for a buyer’s agent not to open an email sent at 8:30 p.m. until the next morning.

As between the remaining answers, C, D, and E, the RPA specifically defines “Days After” in paragraph 30G to mean, for purposes of the NBP, 2 “calendar days,” not 48 hours. Hence, 48 hours after personal receipt by the buyer’s agent (Answer C) or 48 hours after confirmation by the buyer’s agent (Answer D) are both wrong. The RPA definition of “Days After” also states that it ends “at 11:59 PM on the final day.” Answer E is the correct answer.

-Thank you to Keith Fisher (Sherman Oaks Metro Arts 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 18, 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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