June 5th, 2017 at 10:07 am
Question: A buyer and seller are in a pending sales transaction. The buyer obtains a termite report from XYZ Termite Company. The buyer uses the C.A.R. Request for Repairs form to ask for the seller to pay for Section 1 work as specified in the attached XYZ report, and to provide a termite certification. The seller agrees. Is the seller required to use XYZ for the termite work and certification?
Answer: Most likely no, but the RR language is not 100% clear. C.A.R.’s Request for Repairs (Form RR) requires the seller to “pay to have Section 1 work completed as specified in the attached Pest Control Report dated ______ prepared by _______.” The most likely interpretation of that provision is that the seller must pay for the work specified in the XYZ report, not that the seller must use XYZ for the work. The RR further states that, “If Buyer requests either Section 1 or Section 2 work above, Seller shall, no later than 5 (or __) Days Prior to Close of Escrow, Deliver to Buyer a written pest control certification showing the corrective work has been completed.” Again, the most likely interpretation is that the seller need not use XYZ for the certification.
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May 30th, 2017 at 9:57 am
Question: In last week’s legal tip, you addressed the CalBRE requirement for a listing agent to give the seller a copy of the listing agreement at the time of signing, and not wait until later. As the listing agent, if I print out the listing agreement to bring with me to the seller’s house for signature (and there won’t be a copier available), you recommended that I also bring another copy for the seller to keep. Both the seller and I will sign my copy. Is the seller also required to sign the copy that the seller keeps?
Answer: No, but it’s a good idea. Legally, if you have your signature and the seller’s signature on your copy, you generally have a binding and enforceable agreement, regardless of whether the seller’s copy is signed. Moreover, the CalBRE rule requiring you to give the seller a copy at the time of signing doesn’t specifically require the seller’s copy to be signed. (more…)
May 22nd, 2017 at 9:55 am
Multiple Choice Question: You are the listing agent. The seller has just signed the Residential Listing Agreement. When are you required to give the seller a copy of the agreement? Pick the best answer:
A. As soon as possible.
B. Within 3 business days.
C. At the time the signature is obtained.
D. Giving the seller a copy is recommended, but not required.
Answer: The correct answer is C or “at the time the signature is obtained.” An agent who secures a client’s signature for a real estate service contract must give a copy of the agreement to the client at the time the signature is obtained (Cal. Bus. & Prof. Code section 10142). This rule applies to listing agreements, buyer-broker agreements, lease listing agreements, and other agreements pertaining to licensed real estate services. A failure to comply with this requirement is grounds for disciplinary action by the California Bureau of Real Estate (CalBRE).
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May 15th, 2017 at 9:50 am
The California Secretary of State (SOS) recently added 10 million records to its Business Search tool, available free-of-charge at Business Search. The SOS is a governmental agency that keeps tracks of companies doing business in California, including corporations, limited liability companies (LLCs), and partnerships (but not fictitious business names). In the past, the SOS Business Search tool provided very limited information about a company, such as company type, status, address, date of registration, and agent for service for receiving court documents. Now the Business Search tool also provides access to Statements of Information, Articles of Incorporation, Registration, and other records. These records provide, among other things, the names of the officers and directors in charge of a company.
In our day-to-day practice, we often encounter corporations and LLCs as sellers, buyers, landlords, brokers, business managers, investors, mortgage brokers, vendors, and so on. We cannot tell by looking at the name of a company whether it’s legitimate or whether the people who say they can act or sign on behalf of the company are in fact the authorized representatives. The newly updated SOS Business Search tool will greatly enhance the transparency of the companies with whom we may be considering doing business.
Copyright© 2017 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 May 15, 2017. 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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May 8th, 2017 at 9:47 am
Question: I am the listing agent in a transaction. The buyer refuses to sign the disclosures. Should we just document the file to show that the disclosures have been given to the buyer and that we’ve asked for the buyer’s signature, or can we force the buyer to sign?
Answer: It depends on which disclosures have not been signed. The RPA does require the buyer to sign the TDS, NHD, lead-based paint, and certain other “Statutory Disclosures” (see paragraphs 10A(1) and 10A(5)). If the buyer fails to sign the Statutory Disclosures during the buyer’s inspection contingency period, the seller (more…)
