November 26th, 2018 at 10:55 am
Answer: This is a very unfortunate situation. As background, the SP usually works fine as an agreement obligating a seller to pay a broker commission if a specific buyer purchases the seller’s property. However, at times, completing the SP form can be tricky. You definitely want the seller to sign the SP before you present the buyer’s offer. Yet, under certain circumstances, you may not necessarily want to reveal the buyer’s identity in the SP. If, for example, the buyer identified in the SP is someone who the seller is acquainted with (like a friend, neighbor, or celebrity), or someone the seller can otherwise contact, the seller may decide not to sign your SP, and just sell directly to the buyer you identified without your involvement.
One suggestion is, instead of identifying the buyer’s name in the SP, insert a detailed description for “Buyer,” such as: “a buyer whose offer will be presented by Broker to Seller within 24 hours after Seller executes this Agreement.” Another possibility would be to insert as “Buyer” something like: “the buyer whose offer is in the yellow envelope marked ‘Sealed Offer for Sally’s Property.’”
-Thank you to Vahn Alexander (Brentwood Office) for suggesting this week’s legal tip.
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