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Posted on Tuesday, October 30th, 2018
Real Estate Attorneys are often asked about the validity of contracts in certain situations – will an addendum work or does a contract need to be completely re-written? Often the answer to this question is, “it depends.”
For instance, take the following example:
An Agent is working on a Residential Transaction, but the Contract was supposed to close last week. On the Closing Date, the Buyer tells the Agent that they are waiting to see an insurance claim, but may want to proceed with the sale despite the damages – however, the Seller has not sent the information to them yet.
Thus, the Agent sends an Addendum to be signed, however, at this point it still has not been signed.
Technically, they are now out of Contract, however there are a few extenuating circumstances: 1) some of the parties may not have internet or phone service, and 2) all parties are willing to continue with the purchase.
With this information in mind, what is the appropriate course of action? Should they “back date” the Addendum to be in compliance? Or do they need to re-write the Contract?
In this case, the Contract could simply be reinstated through the Addendum by adding, “All parties agree to reinstate the contract dated: ______”
In this example, the solution is a fairly simple fix. However, depending on the willingness of the parties, the complexity of the transaction, and the variable circumstances that surround any sale, this solution may not be appropriate in other situations. It is always important to consult with a Real Estate Attorney before moving forward with a Contract that may have compliance issues. By being proactive and consulting an Attorney BEFORE there is a dispute, you can avoid spending precious time and resources on an avoidable conflict. The offices of Nishad Khan P.L. are available to answer these complicated questions and settle any contractual uncertainties that you may face. Call today to speak to your Experts in Real Estate Law.
The information presented in this “Tuesday Takeaway” is intended for informational purposes only. This information should not be used as legal advice applicable to a specific situation. In addition, our provision of this information to an individual in no way constitutes an attorney-client relationship.