[WSBARP] NWMLS Form 35

[Kary Krismer]

The forms have numerous situations where an event triggers the 
cancellation of the contract, and then explicitly states what happens to 
the EM.  That is not the case with this new Form 35 language.

But in any case, the forfeiture of EM liquidated damages provisions only 
apply per Form 21:  "In the event Buyer fails, without excuse, to 
complete the purchase of the property . . ." Where the buyer still 
wishes to proceed to closing, the liquidated damages clause is not 
applicable.

As to your concern about the change, nothing prevents the listing agent 
from asking for the page(s) of the report that describe an item 
requested for repair/adjusted price.  Sometimes that is necessary, but 
usually that's due to a poorly worded inspection request.  For example 
this year we had a buyer asked for "Seller to repair missing siding 
piece" without describing where the missing siding was located.  It 
turned out it was a location you could only see from the roof.  We had 
to request more information from the buyer's agent.

Kary L. Krismer
John L. Scott, Inc.
206 723-2148

On 10/7/2019 1:55 PM, Craig Blackmon wrote:
> Colleagues, I've considered the issue and have reached the opposite 
> conclusion. By providing a portion of the report, buyer breached. No 
> further performance is due, and seller is entitled to the liquidated 
> damages (forfeiture of earnest money).
>
> This is exactly the purpose of liquidated damages. The seller's injury 
> -- learning of a defect that must now be disclosed in the future, with 
> the resulting loss in value -- cannot be ascertained. The way the 
> contract is written, I think seller is entitled to the earnest money. 
> Presumably the parties can negotiate a better resolution than that -- 
> but seller keeps the earnest money otherwise.
>
> Note that I am really disappointed with this recent change to the 
> form. I feel it impairs a buyer's ability to communicate the defect 
> that must be cured in satisfaction of the inspection contingency. The 
> authors of the form felt that the change was needed to prevent buyers 
> from using inspection reports (and the resulting duty to disclose to a 
> subsequent buyer) as an unfair negotiating tactic.
>
> I'd like to see an exception inserted that allows a buyer to provide 
> those specific and limited portions of a report that identify repairs 
> the seller must address in order to satisfy the inspection 
> contingency. In the meantime, I see risk of a dispute between buyer 
> and seller either just before or right after closing, as to whether 
> the seller fixed the defects as "agreed." The parties can foreseeably 
> have a misunderstanding, given the inability to share the relevant 
> portions of the report.
>
> We'll see how it unfolds.
>
> Craig
> Craig Blackmon, Attorney at Law
> Seattle Real Estate Lawyer <http://www.seattlepropertylawyer.com/>
> 92 Lenora St. (The Makers Space, a shared work environment)
> Seattle WA 98121
> Office/Cell: (206) 369-5949 Fax: (206) 770-7328
> @LawyerBroker <https://twitter.com/LawyerBroker>
> How to Buy Without an Agent 
> <http://www.seattlepropertylawyer.com/blog?category=Buy+without+an+Agent> | 
> How to Sell FSBO 
> <http://www.seattlepropertylawyer.com/blog?category=Sell+FSBO> | RE 
> Glossary 
> <http://www.seattlepropertylawyer.com/blog?category=Real+Estate+Glossary>
> CONFIDENTIALITY NOTICE: This communication is a private, confidential 
> electronic communication encompassed by 18 USC 2510. It is for the 
> sole use of the intended recipient and receipt by anyone other than 
> the intended recipient does not constitute a loss of its confidential 
> or privileged nature.  Any review or distribution by others is 
> strictly prohibited. If you are not the intended recipient please 
> inform the sender and destroy all copies.
>
>
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://mailman.fsr.com/pipermail/wsbarp/attachments/20191007/be60a1bd/attachment.html>