<div dir="ltr"><div class="gmail_default" style="font-family:verdana,sans-serif;font-size:small;color:#073763"><div class="gmail_default">This addendum language came out of our office. It came about in response to a recent notice from King County (a number of weeks back) that recordings may be delayed by several days or more. We had word that other counties were experiencing similar issues as well. Given our understanding that title and casualty insurers are generally willing to insure the gap period, we came up with this addendum to address the concern of the parties becoming out of contract if the transaction did not "close" on time. </div><div class="gmail_default"><br></div><div class="gmail_default">I appreciate the thoughtful commentary offered by Craig and Kary. Here would be my thoughts in response:</div><div class="gmail_default"></div></div><div class="gmail_default" style="font-family:verdana,sans-serif;font-size:small;color:#073763"><br></div><div class="gmail_default" style="font-family:verdana,sans-serif;font-size:small;color:#073763"><div class="gmail_default"><span style="font-family:Arial,Helvetica,sans-serif;color:rgb(34,34,34)">What if the county rejects the recording and requires one of the parties to re-sign something and that party now refuses?</span> </div><div class="gmail_default">I don't think either party would have a basis to refuse,
and both parties would be bound by the duty of good faith and fair dealing to complete the act of recording. As between Buyer and Seller, the transaction would be closed as of the "Submission Date" (which is defined earlier in form to be the date on which the closing docs are submitted to the county for recording, regardless of whether they are actually recorded that day). As such the parties would not be out of contract or free to walk away, but rather would be closed as between the two of them, but with the surviving need/obligation to record the documents, which essentially would be a ministerial act at that point, but not one which either party would be entitled to avoid. I suppose if the seller just disappeared then a court could be petitioned for an order to complete the recording.</div><div class="gmail_default"></div><div class="gmail_default"><br></div><div class="gmail_default"><span style="color:rgb(34,34,34);font-family:Arial,Helvetica,sans-serif">I am concerned about an insurable interest in the event of a casualty.</span> <br></div><div class="gmail_default">The Buyer would have an insurable interest due to the change in definition of "closing", and as paragraph 3 says, both parties should ensure that they have adequate coverage from the point of closing to the point of recording.</div><div class="gmail_default"><br></div><div class="gmail_default">I believe (but do not know for sure) that NWMLS will be addressing this issue in an upcoming round of forms revisions. </div><div class="gmail_default"><br></div><div><div dir="ltr"><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><p class="MsoNormal" style="background-image:initial;background-position:initial;background-repeat:initial"></p></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div><div><div dir="ltr" data-smartmail="gmail_signature"><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><p class="MsoNormal" style="background-image:initial;background-position:initial;background-repeat:initial"><b><font face="verdana, sans-serif" color="#073763"><br></font></b></p><p class="MsoNormal" style="background-image:initial;background-position:initial;background-repeat:initial"><b><span style="font-size:11pt;font-family:Garamond,serif;color:rgb(7,55,99)">David C. Daniel</span></b><span style="font-size:11pt;font-family:Garamond,serif;color:rgb(7,55,99)">, Attorney</span><br></p><p class="MsoNormal" style="background-image:initial;background-position:initial;background-repeat:initial"><span style="font-size:11pt;font-family:Garamond,serif;color:rgb(7,55,99)">
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<b>Email |</b> </span><u><span style="font-size:11pt;font-family:Garamond,serif;color:rgb(17,85,204)"><a href="mailto:ddaniel@demcolaw.com" target="_blank">ddaniel@demcolaw.com</a></span></u><span style="font-size:12pt;font-family:"Times New Roman",serif"><span></span></span></p><p class="MsoNormal" style="background-image:initial;background-position:initial;background-repeat:initial">
</p><p class="MsoNormal" style="background-image:initial;background-position:initial;background-repeat:initial"><span style="font-size:11pt;font-family:Garamond,serif;color:rgb(7,55,99)">5224 Wilson Ave. S., Suite 200</span></p><p class="MsoNormal" style="background-image:initial;background-position:initial;background-repeat:initial"><span style="font-size:11pt;font-family:Garamond,serif;color:rgb(7,55,99)">Seattle,
WA 98118</span><span style="font-size:12pt;font-family:"Times New Roman",serif"><span></span></span></p></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div><br></div><br><div class="gmail_quote"><div dir="ltr" class="gmail_attr">On Tue, Nov 3, 2020 at 3:13 PM Kary Krismer <<a href="mailto:Krismer@comcast.net" target="_blank">Krismer@comcast.net</a>> wrote:<br></div><blockquote class="gmail_quote" style="margin:0px 0px 0px 0.8ex;border-left:1px solid rgb(204,204,204);padding-left:1ex">
<div>
<p>The state-wide forms people are apparently working on this issue
and apparently finding a number of different issues necessary to
resolve. So caution is probably indicated. <br>
</p>
<p>I've heard they've discounted the casualty insurance issue, which
I consider to be the major issue. I think paragraph 3 should
probably provide that both parties should maintain insurance until
recorded if you're willing to take the risk on that issue. But
with that paragraph 1 language changing the definition of closing
seemingly the buyer would have an insurable interest, unlike the
standard state-wide forms.<br>
</p>
<p>I'd not have thought too much about the county rejecting
documents prepared by a professional escrow in a normal
purchase-sale transaction. Has anyone seen that? There is
typically limited power of attorney language to correct mistakes
as part of the escrow instructions, so maybe that would deal with
it where the document didn't need to be completely redrawn. But
what about a valuation issue holding things up?<br>
</p>
<pre cols="72">Kary L. Krismer
206 723-2148</pre>
<div>On 11/3/2020 3:02 PM, Craig Gourley
wrote:<br>
</div>
<blockquote type="cite">
<div>
<p class="MsoNormal">Listmates, I just received an addendum on
a Purchase and Sale we are closing and it has my antenna’s
up. <u></u><u></u></p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">I have seen gap insurance in limited cases
when something unusual happens and title will insure as of a
specific date even though a deed has not recorded but it is
typically with the consent of the lender. Given the
propensity of the County recording office to play Jr lawyer
and reject recordings for any number of stupid reasons I am
reluctant to follow this addendum. What if the county
rejects the recording and requires one of the parties to
re-sign something and that party now refuses? I am concerned
about an insurable interest in the event of a casualty. I am
sure given a minute I can come up with additional participants
in the potential parade of horrors. Thoughts? Comments? Am I
being overly concerned about nothing? The addendum is below.
<u></u><u></u></p>
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