Wisconsin REALTORS® Association - Legal Hotline Hottips
Legal Hottips - June 29, 2009 July 1 is Deadline for Mandatory Use of Electronic Real Estate Transfer Return Electronically filed returns provide more accurate and complete data than paper returns and can be processed more quickly. Housing the data in a secure electronic environment strengthens the protection of confidential taxpayer information. The Department of Revenue (DOR) is required to share the information on the returns with municipal assessors, county officials and other state agencies. The legislation gave DOR the authority to provide the data to the public free of charge with the exception of personal information such as Social Security numbers. E-filing waivers will be granted in certain circumstances. For more information, visit http://www.revenue.wi.gov/ust/retn3.html
New E-Credential Process Announced by DRL "We are using new technology to make the process of providing a renewed credential to our customers more timely and cost effective," said Secretary Jackson. DRL will no longer mail credentials to individuals who renew on-line. Instead, credential holders will be able to print their own full color credential, suitable for framing and display, as soon as the Department processes the renewal. DRL will alert credential holders by e-mail when their credential is available to be printed. "Credential holders who renew on-line have been telling us how great it would be to get their renewed credential on-line also and we are delivering on that request, right into their inbox," said Secretary Jackson. The entire on-line renewal process (including printing of the "E-Credential") is handled securely and confidentially with personal information of the licensees protected. The new process will also allow individuals to print extra copies of their credential (where permissible by law), at no charge, to replace a missing credential or to display it in an additional location at which they practice. The current charge for each duplicate credential is $10. "The new process will also make it easy to update and print an official credential that reflects current information if there is a name or address change for the credential holder," said Secretary Jackson. The new "E-Credential" will be implemented with renewals as they come up over the next two years. DRL will continue to print and mail credentials to individuals who choose not to, or are unable to renew on-line and prefer the traditional method for renewing their credential. More information about E-Credentials is available at http://drl.wi.gov/ecredential_about.html DRL External Newsletter 1.) Offer to Purchase - Dates and Deadlines If the sellers signed the offer to purchase on June 3rd but did not fax the signed offer to the selling agent, and instead had the selling agent pick up the accepted offer on June 4th, would this be the date of delivery? Therefore, dates and deadlines would run from the date of delivery, June 4th, and the first day to start counting would be June 5th? The sellers faxed over a letter to the selling agent after midnight on June 24th terminating the offer because there was 21 days for the loan commitment. The sellers were kept up to date on the process. The appraiser did not get the appraisal in until June 24th and therefore the buyer would not be able to get the loan commitment until June 25th, waiting for the PMI to be approved. Messages were left with the sellers to return the selling agent's call to discuss an amendment, if necessary. The sellers mentioned that there was another buyer. The loan officer left a message with the sellers explaining that the loan had been approved awaiting the PMI approval. Lines 17-21 of the WB-11 Residential Offer to Purchase state, "ACCEPTANCE. Acceptance occurs when all Buyers and Sellers have signed an identical copy of the Offer, including signatures on separate but identical copies of the Offer. CAUTION: Deadlines in the Offer are commonly calculated from acceptance. Consider whether short term deadlines running from acceptance provide adequate time for both binding acceptance and performance." Therefore the date of acceptance was June 3rd. June 4th is the date of binding acceptance, but that is not the benchmark for most dates and deadlines in the offer. In calculating dates and deadlines, Lines 140-144 of the WB-11 provide that, "Deadlines expressed as a number of 'days' from an event, such as acceptance, are calculated by excluding the day the event occurred and by counting subsequent calendar days. The deadline expires at midnight on the last day. Deadlines expressed as a number of 'business days' exclude Saturdays, Sundays, any legal public holiday under Wisconsin or Federal law, and any other day designated by the President such that the postal service does not receive registered mail or make regular deliveries on that day." 2.) Offer to Purchase - Delivery QUESTION: An offer was on the table drafted and delivered on June 13. A counter-offer was drafted by the buyer on June 16 (due to competition on the property) and delivered the same day with a binding acceptance date of June 17. The sellers signed the counter-offer and it was delivered to the buyers at one of the two fax numbers provided by the buyers for fax delivery. The agent went home after faxing it (and after waiting to see that it went through and that no rejection was printed). The following day the buyer's agent said he did not receive the fax on his fax machine (we believe it jammed). So the listing agent resent it and it was received. To clarify that binding acceptance had occurred, the parties amended the offer to provide that the binding acceptance date was changed from June 17 to June 18. The buyer's broker does not feel satisfied that this is an accepted offer. How to proceed? ANSWER: Binding acceptance will occur when the accepted offer or counter-offer is delivered in accordance with the terms of the offer. For fax delivery, receipt is not required. Rather delivery occurs upon fax transmission to the appropriate fax number as stated on page 1 of the offer, i.e., when the offer (or counter-offer) is faxed. It is always a good idea, therefore, to save the printed receipts/logs from the office (and agent's) fax machine. 3.) Title Issues - Miscellaneous Title Issues QUESTION: The broker is the listing agent on a property scheduled to close next week. The title company has just called and informed the agent that the seller has title issues including a Chapter 13 bankruptcy filed two years ago and a recent foreclosure judgment filed last month. The title company says the seller needs a court order for permission to sell property. Please advise. ANSWER: Under these conditions, the seller is unable to provide merchantable title to the buyer. The buyer should object to the foreclosure judgment and the Chapter 13 bankruptcy and the seller will have 15 days to clear the title. Pursuant to the WB-11 Residential Offer to Purchase at lines 207-212, the closing date will be extended accordingly. If the seller can get the permission of the bankruptcy trustee to sell the property (and if there's a foreclosure, there's likely no equity in the property so this may not be too difficult to get), and get the foreclosing party to agree to accept the net proceeds in exchange for satisfying the judgment and releasing the lis pendens, it ought to be able to close. If, however, the seller is unable to clear these items within the 15 days and the buyer doesn't want to wait any longer, the buyer may declare the offer null and void. 4.) Listing Contracts - Miscellaneous Listing Issues QUESTION: An agent is working with a seller who had had his property listed with another company. The seller received an amendment to the listing contract expiring the listing on May 20, but in the MLS it shows the listing is still active. The second broker had the sellers send over a copy of the amendment to the first listing broker, but it still hasn't been updated on the MLS. What are the second broker's options? ANSWER: It may be possible for two brokers to have the same property listed in the MLS if both brokers believe they have a valid listing contract. The status of the first listing in the MLS is an issue between the seller and the first listing broker. The second broker may not give the seller legal advice regarding the previous listing, therefore, the second broker may refer the seller to private legal counsel and or the previous broker to address the status of the previous listing. The broker may wish to review the local MLS rules. The following is an excerpt from the NAR 2009 Handbook on Multiple Listing Policy.
5.) Offer to Purchase - Cancellation and Mutual Release QUESTION: The broker has a customer whose offer to purchase is going to be subject to termination due to the buyer not delivering the loan commitment in a timely manner. There is a secondary offer. Should the broker notify the secondary buyers that they are primary before the current primary buyer has signed the Cancellation Agreement and Mutual Release (CAMR)? The secondary buyers are expecting to be primary at one minute after midnight of the primary buyer's deadline to perform on financing. Please advise. ANSWER: By having the CAMR signed by the primary buyer and the seller, there is no question that the first agreement is over. The fact that the primary buyer does not deliver the loan commitment in a timely manner does not automatically terminate the first offer at 12:01 a.m. Rather, if the buyer fails to meet the deadline, the seller has the right to notify the primary buyer of the seller's election to terminate the contract due to the buyer's breach thereof. The seller can give the primary buyer a written notice of the seller's election to terminate the agreement along with a CAMR. In the event the primary buyer refuses to sign the CAMR, the seller should be advised to consult with legal counsel before elevating the secondary offer into primary position. Debbi Conrad |