Fact Pattern: You are taking a new listing for a property owned by newlyweds Harry and Wendy Love. Wendy wants you to get started selling their home right away. Harry, however, is out of town for about a week, and he cannot sign any paperwork until he returns.

Multiple Choice Question: How should you write up your listing agreement? Pick the best answer:

A. Put the listing in both names, but only get Wendy’s signature for now.
B. Put the listing in both names, and have Wendy sign for both Harry and herself.
C. Take the listing in Wendy’s name only.
D. Do not take a listing until Harry can sign. 

Answer: Answer A is not wrong. You can write up the listing agreement in both names, and have Wendy sign now so you can get started right away marketing the property for sale, as Wendy has requested. The problem is your listing agreement is not fully executed by the sellers. Before Harry signs, the sellers may change their minds about the listing price, commission rate, or even listing their property with you. If that happens, they will likely try to argue that you do not have a valid listing yet because only Wendy has signed.

Answer B is wrong. Even though Wendy is Harry’s spouse, she has no right to sign for Harry nor bind him to a contract. To sign on Harry’s behalf, Wendy must have a Power of Attorney for him. Otherwise, if you have Wendy forge Harry’s signature, you’ll give the sellers a good excuse to get out of your listing agreement at any time.

Answer C is the best answer, with a caveat. Paragraph 24 of C.A.R.’s Residential Listing Agreement requires Wendy to warrant that she is the only owner of the property. As an exception to her ownership, title, and authority, you should insert in the blank lines provided in paragraph 24 something like: “Seller represents that her husband and co-owner, Harry Love, will also enter into this Agreement by February 20, 2021.” When Harry returns to town, you can use a C.A.R. Modification of Listing (MT) form to add him to your listing agreement.

Of course, Answer C is much like Answer A in that your listing agreement will not be binding against Harry who can try to renegotiate before he signs. However, Answer C is better than Answer A to the extent that the sellers cannot argue that you do not have a fully executed listing agreement.

Answer D is not wrong. You can choose to wait until both owners are available before you take a listing. The problem in this situation is, if Wendy wants to get started right away, but you refuse to take a listing yet, the sellers could decide to list their home with someone else instead.

-Happy Valentine’s Day to you and your loved ones!

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 February 8, 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.