Articles Vancouver Real Estate

Real Estate Contracts: Time is of the Essence….

Don’t get caught with your pen down

When they say on contracts of purchase and sale “time is of the essence”. We really mean it!

Let me show you why…

Example:

A long time ago we had a contract on a very nice condo at Woodwards in East Vancouver. We tied it up in subjects, finalized financing, read all the strata docs and got answers on anything and finally did the inspection.

After the inspection we noted a few items needed repairing replacing, etc…

So that night at 10:30 PM (as the deal would expire at midnight) we sent in the subject removal with the items that needed to be addressed. Subject removal comes in the form of an addendum. However, the way we structured it was that page 1 and 2 were the removal but age 3 were the new conditions. Since the addendum was labelled page 1 of 3, 2 of 3 and 3 of 3 that meant they needed to sign off on it as the seller.

**Typically a subject removal with no other terms/conditions or changes in it does not need to be signed by the seller. If sent regularly the deal is done once the buyer signs off.

At around 11 PM the selling agent told me he won’t be able to have the seller sign off as he cannot meet him so late. I said “that should be fine”. Now folks, this is where it gets sticky… and this is a good lesson to learn and another reason why your Realtor should have an online signing Ap like docusign or authentisign!

I woke up the next day to a flood of texts and email from my clients who woke up in cold sweats in the middle of the night! Had a quick phone call and said they have made a huge mistake and this is not the one. I said, oh no. I have some work to do here. But, I knew that since the addendum was not signed before midnight we had technically expired. I quickly called Spagnuolo (my lawyers) and what they said gave some relief “there is no lawyer in Canada that can reactivate an expired contract”.

I had to make the very uncomfortable call to the other agent that my clients in fact were not removing subjects and since the contract expired at midnight we would not proceed. I apologized to the agent as he was the one who needed to call his sellers which was probably one of the worst phone calls he has ever had to made. He did not go down without a fight but soon realized that there was not much they could do as they did not sign off by 11:59 that eve.

My clients got out free and clean, the sellers ended up selling for 7,000 more than our previous offer so all worked out. But the lesson here is that TIME IS OF THE ESSENCE! If something needs to be signed before an expiration date/time – you get that signed.

Get an online signing ap (Docusign or Authentisign). Times are changing and we need to change with it. A Vancouver Realtor who is up to date and current with new advances in Real Estate is integral.

 

No comments yet