MAR Legal Hotline Notes - July 2018
Monday, July 2, 2018
Posted by: Karen DeDonato
July Notes from the MAR Legal Hotline
I represent a seller who has signed and delivered an accepted offer, but we still haven’t received a check from the buyer. Is this a binding contract?
In order for a binding contract for the purchase of real estate to exist, there must be a written offer, acceptance, and consideration. Typically, the exchanging of a “good faith deposit” with an offer is thought to be the requisite consideration to bind the offer. However, that is not necessarily the case. Where the buyer has promised to purchase the property for a set price and the seller has accepted this offer by promising to sell, this mutual exchange of promises is sufficient to form a binding contract. The check typically serves to demonstrate good faith and add a layer of protection for the seller in the event of the buyer’s default.
Keeping the aforementioned in mind, it is important to note that if the Contract to Purchase (such as MAR’s Form 501), specifically calls for the remittance of a check in order to bind the offer, failure to deliver a check could constitute a breach of the contract by the buyer.
Do you have any suggestions for Realtor® safety during client meetings and showings?
With the real estate market picking up with the nicer weather, it is always important to keep these safety tips in mind:
1. Have your initial meeting with a prospective client at your
office or other public place
2. Try to show properties while it is still light out
3. Always make sure at least one person knows where you will
be, with whom, and when you expect to be back
4. Limit the personal information you share
5. Always have a prospect walk in front of you – guide, don’t
6. Do not park in the driveway, if possible
7. Take a photograph of your prospect’s license plate and car
and email it to someone
8. Learn some basic self-defense skills
9. Be aware of your surroundings
10.Keep your cellphone charged and on you at all times
More tips and safety planning information can be found at www.nar.realtor/safety.
I’ve had a seller’s agent tell me that they won’t present my client’s offer. Can they do this?
Both state regulations (254 CMR 3.11(d)) and the Realtor® Code of Ethics (SOP 1-7) require that offers be presented to the client right away. However, it is important to remember that your fiduciary duties as an agent require you to follow the lawful instructions of your client. Therefore, the seller is free to set parameters for the agent to follow regarding offers, so long as they are legal and not discriminatory. It is impermissible for the agent to unilaterally determine that an offer should not be presented to the seller.
If you are concerned about an offer possibly not being presented to a seller, you may request in your offer that you be allowed to attend the presentation of the offer or include a provision in your offer requiring the seller to sign and indicate rejection of the offer and then return the rejected offer.
Source: Massachusetts Association of REALTORS® Legal Staff
Michael McDonagh, MAR General Counsel
Justin Davidson, MAR Legislative & Regulatory Counsel
Catherine Taylor, Staff Attorney