Discussion #2

.docx

School

Algonquin College *

*We aren’t endorsed by this school

Course

8102

Subject

Law

Date

Jan 9, 2024

Type

docx

Pages

2

Uploaded by ElderSheep2185

Kerry is interested in selling her convenience store for approximately $250 000 to $300 000. As Kerry is unfamiliar with the commercial real estate market in Red Deer, she engages a real estate agent, Patrick. The engagement is a standard form listing agreement. Patrick shows the building to a young couple, Paul and Rick, who seem to be quite interested. In fact, they make an offer in writing to purchase the building for $250 000. They also indicate that they need a reply immediately. Patrick calls Kerry but is unable to reach her. Patrick is in a quandary, but knowing that Paul and Rick's offer is in Kerry's range, albeit at the bottom, Patrick accepts the offer on Kerry's behalf (he signs the written offer). Upon learning of Patrick's actions, Kerry is quite upset and wonders whether she must sell the building to Paul and Rick. Advise Kerry. There are several ways to see what is happening with Kelly and Patrick. Kelly needs to review the terms in the listing agreement she signed with Patrick, the real estate agent, and learn how things usually work in Red Deer's real estate practices. Kelly should reach out to Patrick directly to discuss the offer he signed and figure out what happens next, especially when compared to the listing agreement. Suppose Kelly is okay with the $250,000 offer but is unhappy because Patrick accepted it without her agreement. In that case, she can review the listing and talk to a lawyer to ensure everything is legally completed. She needs to be clear that she is the primary seller, and the agent is not a partner in the deal because his signature was on the offer, and also, in case there are some terms in the listing agreement which can support this scenario. However, if Kelly is upset because she does not want the $250,000 offer and wants to sell for a higher price, she still needs to contact a lawyer to find out how to appeal the offer. Here are some things to keep in mind: - If the agreement says the agent can fully act on behalf of the participant with the third party, Kelly might not be able to change the offer. She can accept it if it is in the price range she wants. Talking to a lawyer to check if other legal steps are needed for the buying process is a good idea. She can also consider contacting the buyers and negotiating the price with them, as no deposit was given to them, which can help. - If the agreement makes the participant responsible for the contract and the agent is just the connection between the participant and the third party, Kelly can ask a lawyer for help in appealing the offer supporting it with the concept of the violation of a contract by the agent. The agent acted on the participant's behalf when the contract stated that the participant was
responsible for accepting or declining an offer for the property. This is because the agent does not own the property, and what the agent did might be seen as shady or even fraud. In conclusion, the agent should have waited for Kelly's answers or negotiated with the buyers (third party) to give him a couple of hours until Kelly answered if she accepted the offer.
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