Wisconsin REALTORS® Association - Legal Hotline Hottips
Legal Hottips - February 4,
2008 1.) Listing Contracts - List Price The listing broker should not advertise at a price other than list price unless specifically authorized by the seller elsewhere in the listing contract. The listing broker may tell a buyer that the seller will not look at any offers for less than $100,000 and may refuse to submit them to the seller. If a buyer wants to write an offer at $95,000, the broker may tell him that the seller has instructed to not submit or present any offers less than $100,000. READ MORE ABOUT IT: 2.) Offer to Purchase - Subject to Sale QUESTION: The sellers have an accepted offer on their home with a sale of home contingency and a 96-hour bump notice. Can the sellers issue a bump notice to the buyer without having a secondary accepted offer on their home? They just want to issue the notice so they can rent the home out. ANSWER: Per line 282 of the WB-11 Residential Offer to Purchase, the sellers must first accept a bona fide secondary offer before being able to issue the bump notice. Bona fide means an arms length good faith offer, not a sham offer from a friend. 3.) Offer to Purchase - Presentation QUESTION: A cooperating agent wrote an offer last fall for a buyer for $675,000 on a high-end condominium that was on the market at $700,000. When the cooperating agent delivered the offer to the listing agent, she basically stated it was a terrible offer and a ridiculous price. They did counter once or twice. The seller then received an offer from another agent in the listing office and the sellers decided to take the other offer, rejecting the cooperating agent's offer. The cooperating agent was unaware there was another offer. The cooperating agent looked up the property on MLS and saw that the listing agent sold it to her own buyer for $650,000. If there is doubt if an offer was presented or presented fairly, is there any way to ask for proof that the offer really was presented? ANSWER: Wis. Admin. Code § RL 24.13(4) provides, "NOTIFICATION OF ACTION TO BUYERS. Licensees shall promptly inform prospective buyers whether the seller has accepted, rejected or countered their written offer to purchase, and shall immediately provide a written statement concerning the date and time when an offer was rejected or that an offer had expired without acceptance when such a statement is requested by a prospective buyer, a buyer's agent or a selling broker." READ MORE ABOUT IT: 4.) Disclosure - Environmental & Health Issues QUESTION: Is a Sandpoint well something that should be disclosed on a real estate condition report (RECR) since it is a non-conforming well? And if so, if a property was purchased and this was not disclosed, is there any recourse for the buyers if this was not disclosed? ANSWER: Arguably yes. Question C5 of the RECR addresses defects
in wells on the property. If the buyer can show the seller was had
knowledge that the well was non-conforming and incorrectly completed
the RECR, he may have a breach of contract, false advertising and/or
misrepresentation claims against the seller. If the listing agent was
also aware of non-conforming well and knew that the seller did not
disclose it in the RECR or offer, the listing agent arguably should
have disclosed the information to the parties. READ MORE ABOUT IT: 5.) General Real Estate - Miscellaneous Issues QUESTION: Re: "Ad valorem" in a lease. The lease states: "The lessee agrees to pay, when due, all ad valorem taxes and all personal property taxes levied during any term of this lease." Does ad valorem include real estate taxes? ANSWER: Yes. "Ad valorem" means according to value. The most common ad valorem tax is real estate property taxes. Ad valorem taxes may also include personal property taxes. This Wisconsin REALTORS® Association Best of the Legal Hotline service is provided for you by the WRA's Legal Affairs Department. The service should be considered a general statement of applicable legal principles. Given this format, it is impossible to fully address all potential legal issues which might apply in any particular situation. A determination of any individual's legal rights in a transaction can only be obtained after complete analysis of the law and its applicability to the particular fact situation. Please contact the WRA Legal Hotline if additional information is needed, or private counsel, if legal advice is needed. Thank you for using the Wisconsin REALTORS® Association Best of the Legal Hotline service. Debbi Conrad |