What’s the Difference Between “No Contract” & “Breach of Contract?”

Answer: a Lawsuit and Big $$$ (Potentially)

[Editor’s Note: The views expressed here are solely those of Ross Kaplan, and do not represent Edina Realty, Berkshire Hathaway, or any other entity referenced. If you need legal advice, please consult an attorney.]

“PREVIOUSLY WRITTEN PURCHASE AGREEMENT: This Purchase Agreement Is/Is Not subject to cancellation of a previously written purchase agreement dated _______________ .”

–Standard Minnesota Purchase Agreement; lines 251. – 252.

Consider this not-so-hypothetical scenario: the Buyer and Seller have a fully signed (executed) Purchase Agreement, but the Buyer has yet to deliver the stipulated earnest money (at least in Minnesota, required within two business days).

Buyer #2 then shows up with a (much) sweeter offer that the Seller wants to accept.

Can they?

Yes, with a VERY big if:  if the Seller makes acceptance of Deal #2 subject to the cancellation of Deal #1.

Legal Logic

The perhaps not-so-obvious explanation is that there’s still a contract between the Seller and Buyer #1, albeit one that the Buyer has (temporarily) breached.

Unfortunately for the Seller, in this case, Buyer #1 can “cure” (fix) the breach . . . simply by delivering the earnest money.

That leaves Buyer #2 out in the cold, and the Seller stuck with Buyer #1 . . .

See also, “Accepted Offer” vs. “Fully Executed Purchase Agreement”.”



from RSSMix.com Mix ID 8230700 https://ift.tt/2O5rULG
via IFTTT

Comments

Post a Comment

Popular posts from this blog

Estimating the Discount for a Busy Street (or Not)

Image
The Art of Comp Selection One of the trickier home features to account for in a Comparative Market Analysis (“CMA”) is a busy street. For a family with little kids, a busy street may very well be a deal breaker — in which case the discount is theoretically infinite. At the other extreme, an investor looking for a rental property may see the location as a plus: free advertising! Of course, not all busy streets are created equal: depending on how far the home is set back; elevation differences; the individual home’s layout; and even landscaping and other topography, and the noise level/loss of privacy can vary significantly. Two Strategies Faced with so many variables, Realtors and Appraisers can always simply choose an average discount — say , 10% off. Strategy #2? Choose as Comp’s (Comparable Sold Properties) only homes that are also located on busy streets. Even better: the same busy street. Then, there’s no need to make any adjustment, because all the home...
Read more

“What’s the Highest Point in Hennepin County?”

Image
There sure seems to be some confusion on that, umm . . . point. I’ve now encountered at least three different properties — none close to one another — that all claimed that status in just the last month. For the record, according to Hennepin County’s website, it’s on Williston Road near High Point Road in Minnetonka — 1,131 feet above sea level. See also , “ Florida’s Tallest Point (and how to get there) .” from RSSMix.com Mix ID 8230700 https://ift.tt/2Pq1ndL via IFTTT
Read more

“Are You a Realtor?” “Why, Yes I Am!”

Image
“There Goes My Realtor!” Admittedly, the intended effect is for clients who see me in and around the neighborhood where I live (by Cedar Lake in Minneapolis) to see my car on the road and say, “There Goes My Realtor!” But, my custom license plate (above) is also a conversation-starter when I’m parked. Like today, in Linden Hills, where a builder who has an upcoming listing saw my car and asked if I was a Realtor. I know what to do from there . . .  from RSSMix.com Mix ID 8230700 http://ift.tt/2glixp5 via IFTTT
Read more