On December 14, 2021, C.A.R. not only revamped its standard-form Residential Purchase Agreement (RPA), but it also released over 90 other revised forms. Many of the revisions to the RPA-related forms are minor changes, but the forms were nevertheless assigned a new “12/21 revision date” so you’ll know that you can use them with the updated “12/21 RPA.”

Here are some of the substantive changes to the RPA-related forms: 

Seller Multiple Counter Offer (SMCO): A new provision has been added to withdraw any prior Seller Counter Offer (SCO) that has not yet been accepted (see paragraph 1C of the SMCO). For example, let’s say that a seller has an SCO out to Buyer #1 when the seller receives another offer from Buyer #2 that the seller also wants to entertain. Using the old SMCO, the seller would first withdraw the SCO to Buyer #1 using a Withdrawal of Offer (WOO) form, before issuing an SMCO to entertain multiple offers. With the new language in paragraph 1C of the SMCO, the seller will no longer have to issue a WOO for the prior SCO before issuing the SMCO to that same buyer.

Seller and Buyer Counter Offers (SMCO, SCO, and BCO): Like the RPA, the “Confirmation of Acceptance” paragraph has been deleted from the bottom of the counteroffer forms. Without a completed “Confirmation of Acceptance,” the party who issues the final offer or counter cannot tell when the other side personally receives that document for purposes of determining when contract acceptance occurs (assuming no Designated Electronic Delivery Addresses or DEDAs). Hopefully, the date of the final signatures will be the same day as the other side’s personal receipt. If not, you can just contact the other side to confirm the date of their receipt. Another change to the counteroffer forms is a new provision stating that once a party makes a counteroffer, that party can no longer change his or her mind by going back to accept a prior unaccepted offer or counteroffer (see “Offer” paragraph). That new provision is a restatement of contract law, which considers the issuance of a counteroffer to be a rejection of the prior offer and a proposal of a new offer. As an example, let’s say that a buyer writes an offer for which the seller issues an SCO #1. After issuing the SCO #1, the seller cannot unilaterally withdraw the SCO #1 to accept the buyer’s original offer instead, because the issuance of the SCO #1 is legally deemed to be a rejection of the buyer’s prior offer and the seller’s proposal of a new offer. Once rejected in that manner, the seller cannot go back and unilaterally revive and accept the buyer’s original offer.

Request for Repair and Seller’s Response (RR and RRRR): Any requests or proposals made using the newly revised RR or RRRR now expire after 3 days, unless another timeframe is inserted or the request or proposal is withdrawn in writing before the other side accepts (see paragraph 5 of the RR and paragraph 3 of the RRRR). The new expiration dates for the RR and RRR are similar to the expiration dates for the C.A.R. offers and counteroffers. The 3-day deadline should help ensure that buyers and sellers will negotiate repair requests expeditiously. The revised RR and RRRR also state above the signature lines that, upon issuing an RR or RRRR, that party can no longer go back to accept a prior unaccepted RR or RRRR. Additionally, paragraph 3 of the RR has been revised to allow FHA/VA buyers to request any lender-required repairs (instead of using the stand-alone FVA form, which is still available through zipForms).

Cancellation of Contract (CC): The top section of the CC has been revised to require only the signature of the party cancelling, whereas the old CC required signatures from both parties. As for the bottom section of the CC, a new option has been added to instruct escrow to split the buyer’s deposit between the buyer and seller in the amount indicated.

For more information, including a Quick Summary Guide of the 90+ revised forms, visit C.A.R.’s December 2021 Forms Release webpage (password-protected for C.A.R. members only).

Copyright© 2021 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 December 27, 2021. 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. Written by Stella Ling, Esq.