May 13th, 2019 at 3:17 pm
Fact Pattern: In last week’s legal tip, you said that under the RPA, a buyer who wants to partially assign the contract by adding another buyer, must obtain the seller’s written consent (which cannot be unreasonably withheld). Let’s assume that Buyer Bob is in a pending sales transaction. He signs off on all the seller’s disclosures and removes all his contingencies. Bob wants to add his mom to the contract, and the seller agrees.
Multiple Choice Question: Can Bob’s mom, as the new assignee, now review the disclosures and cancel the agreement without forfeiting the deposit? Pick the best answer:
A. Yes, a buyer’s cancellation rights under the TDS and other laws cannot be waived.
B. No, paragraph 3 of the C.A.R. Assignment of Agreement Addendum (AOAA) states that the assignee approves “all prior approvals and acts of Buyer.”
C. No, an assignment gives the assignee the rights of the assignor, and nothing more.
D. It depends on whether the parties have initialed the liquidated damages clause. (more…)
May 6th, 2019 at 1:33 pm
Multiple Choice Question: I am the buyer’s agent for a pending sales transaction. We are a few weeks into the transaction. My buyer has just informed me that he wants to add his mother to the transaction to help him qualify for his mortgage loan. How do I go about adding the buyer’s mom? Pick the best answer:
A. Ask escrow to draft a new vesting of title.
B. Use a C.A.R. Amendment of Existing Agreement Terms (AEA).
C. Use a C.A.R. Assignment of Agreement Addendum (AOAA).
D. Any of the above. (more…)
April 29th, 2019 at 3:36 pm
Fact Pattern: In last week’s legal tip, you said that, if a buyer fails to submit an initial deposit into escrow within 3 business days, the seller must first issue a 2-day Notice to Buyer to Perform (NBP) before cancelling. Let’s say that we are the listing agent in that situation. We serve the NBP and the buyer still does not submit the deposit into escrow within that 2-day timeframe. Our seller then signs and delivers to the buyer’s agent the C.A.R. Cancellation of Contract (CC).
Multiple Choice Question: Are we, as the listing agent, required to get the buyer’s signature on the CC? Pick the best answer:
A. Yes, the buyer must agree for the cancellation to be valid.
B. No, the seller can unilaterally cancel the contract.
C. No, the seller can use a Backup Offer Addendum (BUO) for the next buyer.
D. No, but the buyer’s signature gives the seller an assurance that this transaction has ended. (more…)
April 22nd, 2019 at 11:37 am
Multiple Choice Question: You are the listing agent for a new sales transaction. The buyer has failed to submit the initial deposit into escrow within 3 business days after acceptance, as required under the C.A.R. Residential Purchase Agreement (RPA). Can the seller cancel? Pick the best answer:
A. Yes, there is no valid contract without a deposit.
B. Yes, the buyer has materially breached the contract.
C. No, the seller must first serve a Notice to Buyer to Perform (NBP).
D. No, unless the seller had already served an NBP on the date of acceptance. (more…)
April 15th, 2019 at 3:36 pm
Question: We went over your legal tip from last week at our office meeting. You said that creating a contract using C.A.R.’s Seller Counter Offer (SCO) requires the seller’s (or listing agent’s) personal receipt of the SCO signed by the buyer before the end of the 3-day expiration period. Let’s assume that the listing agent inserts his or her name in paragraph 2A of the SCO to become an authorized recipient of the SCO signed by the buyer. Here are some of the questions concerning personal receipt that came up at our office meeting: (more…)
