legal hotline
By Chris Darby, Tom Muldoon, and John Nalls of Counselors Title, LLC, and Pardo & Drazin, LLC, General Counsel
QUESTION: What are my responsibilities to a 3rd Party
buyer when it appears as though the tenant will be exercising their TOPA (Tenant Opportunity to Purchase) rights? They still want to inspect the place (and move forward). They are demanding access. Does their interest and contract terms (our responsibility to honor them) evaporate with the tenant statement of interest? Do we need a release or any language to be included in the new contract with the tenant that would allow for the transition from one to the other?
ANSWER: You have to honor the terms of that agreement if they want to remain as what would in effect be a “back-up”. Their rights are subordinate to the tenants, but if they have a ratified contract, those provisions/rights still apply unless or until seller and 3rd Party buyer agree to a release.
QUESTION: If a contract falls apart, can the seller of the
most prudent course is to only enter into another contract after a release has been fully executed or take another contract as backup.
QUESTION: I am the Listing Agent on a cash deal, the settlement date has come and gone and the earnest money deposit (EMD) was never provided. My seller wants to move and resell it, what can we do?
ANSWER: The property can be re-marketed for sale but it must be disclosed that the property is for sale pending a release of the existing contract. Another contract cannot/ should not be ratified until the release is obtained. Even though the buyer has not complied with the terms of the deposit paragraph or the settlement date, there is an agreement in place and to move forward the contract must be mutually released by the parties.
property put the property back on the market without a release. I have always understood that the property can be resold without a release, because the seller or buyer might want to preserve their right to more damages, outside the deposit.
QUESTION: Is there a unilateral release option avail-
ANSWER: That is a very difficult question to answer. If the
ANSWER: No, there is not a unilateral release form. A
contract becomes Void or the buyer has breached, then seller should have the right to resell the property; however, if there is any dispute as to the rights of the parties a seller would want to consult an attorney before reselling the property without a release of the prior contract. The safest and
26 CAPITAL AREA REALTOR ® — Nov/Dec 2018
able in the GCAAR forms to void a contract when the other party does not perform? I did not see one, only the Release Agreement (GCAAR Form #1317), which requires signature from both buyer and seller.
party can have the right to void the contract in relation to a contingency under the contract, but a release of the contract and earnest money would still need to be executed by the parties. In this situation, the Release Agreement would need to be executed to release the contract and deposit.