by Michael H. Wasserman
A pervasive problem for some in contemporary society splits us into two camps. One particular segment of the community. They may be your friends, your neighbors, your co-parishioners. They are fully aware of the environment we live in. They read the same things you do. They receive the same guidances we all do. They take wildly different views of what those writings mean. Who they apply to. They are not easily persuaded by reason or the advice of experts. While they acknowledge legal obligations they still want to “do their own thing,” often to the detriment of others they engage with.
You know who I am talking about. Unrestrained buyers who ask
for the sun, the moon and all the stars based on property inspections without
regard to the terms of their inspection contingency or as-is contract.
Sellers expect buyers to abide by inspection contingency terms
of the contract they (the buyers) offered. If the deal is “as is,” sellers
expect not to hear a thing. If there are “asks” they better be significant
problems. Our contracts are all pretty clear about what is and is not allowed.
But as one drafter on the 7.0 committee acknowledges “the
heart wants what it wants.” If the buyer wants something fixed, it matters not what
the contract says. Whether it is a “major material defect” or “safety issue.” That
buyers promised they wouldn’t ask for anything. That the seller does not want
to be “nickled and dimed.” These buyers are going to ask for whatever they want
to ask for.
Some professionals on the other sides of our deals make the
problem worse, reimagining “as is” clauses to allow asks for “major material
defects and safety issues.” Distorting understanding of the baseline contingency
clauses to have no limitations at all. These enablers inject a viral disregard
of contract terms into the community. Encouraging buyers to ask for anything
they desire and then blindly relaying whatever requests clients direct them to
make. They use up all of our resources and expose us all to run-away
negotiations. Not only on the deal at hand. Super-spreaders of mis-information encouraging
others to behave badly too.
We choose a different course. We – and our broker partners -
advise our clients about the contract limitations. We encourage clients to toe
the line. Not all will be convinced here. In the end, the buyer decides whether
or not a deal makes financial sense. If it does not, we may have no choice but
to ask for concessions. Sometimes we really do need to ask for - or to grant otherwise
questionable concessions to keep a deal moving forward. But we stand behind the
spirit and intent of written contract contingencies and encourage our colleagues
to do so too.
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