How long to return deposits?

How Long to Return Deposits?

How long to return deposits?
By: James L. Goldsmith, Esq.

As a broker holding a deposit, how long should it take you to return it pursuant to the terms of a release signed by both parties or when sufficient time has passed (the 180 days or whatever it has been reduced to) and not litigation/mediation has been initated? I am hearing complaints that listing brokers are taking “too long” to return deposits when buyers are the recipients. I’ve not verified any of these complaints, but they are the focus of a good number of Hotline calls so I thought it merited discussion.

There are times when a deposit cannot be returned despite how evident one party’s entitlement to that deposit may be. We need an agreement between the parties which usually is in the form of a release; or we wait the passage of time and follow the formula for the deposit’s return that is set forth the agreement of sale. Rarely do we await a court order. These issues, however, are not the subject of the more recent complaints.

What I am hearing is that the escrow holding broker has received a release or has received the buyer’s letter demanding return of the deposit given the passage of time without resolution. In those circumstances, the broker has no skin the game and the parties have agreed (in the release or have pre-agreed in the agreement of sale) where that deposit is to go.

In most cases, deposits are returned to buyers because of a termination resulting from an inspection contingency, or, because the buyer did not get the necessary mortgage. Sellers, and in many cases listing brokers who hold the deposit, may be suspect that the buyer’s stated reasons for terminating are bogus, or that the buyer did not make a good-faith effort to get that mortgage. To punish the buyer for their pretextual termination sellers may encourage the broker to hold that deposit as long as possible.

So the question frequently is asked: how long does the broker have to return a deposit once entitlement is established? The agreement provides no answer. So we look to what a court would do.

I think just about any lawyer would give you the same answer. The broker has a “reasonable period of time to return the deposit.” What is “reasonable” depends on the circumstances, but it is hard to fathom that it would take a broker more than several days to issue a check. Perhaps if termination happens so early in the transaction, the broker might be justified in waiting until the buyer’s deposit check clears before making the return. A seller who wants a listing broker to drag his or her feet when returning the deposit should be ignored. If a complaint is made to the Real Estate Commission, it’s not the seller who is under the gun.

I understand that there are pockets in Pennsylvania where buyer brokers hold deposits. It is a practice I think that should be considered by those who don’t. Holding a deposit does not give the broker an advantage over the other. The situations when it should be released and the time of release are not dependent on which broker is holding the deposit. The ability to fund a transaction with a deposit, however, is shorter when the buyer broker holds the deposit simply because there is one less step in the process. A buyer makes their check payable to the selling broker and hands it to their agent when close to a decision. Then, even if the contract is executed via software, the buyer agent merely needs to hear that the offer has been accepted and then place it in his broker’s escrow account. Voila! The transaction is funded rather than having to await the additional step of transfer from the buyer broker to the listing broker.

Lastly, and while we are on the subject, why am I still taking Hotline calls involving convoluted facts of the transaction and questions of breach and entitlement to a deposit when the it is only $1,000? The fight is so greater than the reward and the cost to litigate so much greater than the amount in controversy that nobodies’ interests are served!

As a subcontractor, what happens if I sign releases in order to get paid for my work?

Often contracts for public projects and large private projects require subcontractors to sign lien waivers and releases in order to receive periodic payments for their work. The subcontractors, in turn, are required to obtain similar waivers from sub-subcontractors and suppliers. For subcontractors, this creates a breeding ground for conflict. The subcontractor may feel it has a claim against the general contractor but needs to get paid, and so it is faced with the choice of releasing the claim or potentially not getting paid. This conflict can trickle down to sub-subs and suppliers who may have a claim against any of the other parties. Last year, in Connelly Construction Corporation v. Travelers, the Eastern District of Pennsylvania confirmed that these lien waivers and releases are enforceable. This decision reinforces the need for subcontractors to seriously consider the consequences of signing these waiver forms.  Commonly, general contractors will accept markups to the waiver form intended to preserve a subcontractor’s claim. Subcontractors (as well as sub-subs and suppliers) can benefit greatly from seeking legal advice before signing a contract that requires these forms or the forms themselves.

Stormwater Fees Drawing the Ire of Citizens and Businesses State-Wide

By: Paul Bruder, Esq.

As more and more communities begin charging property owners a stormwater fee (many are calling it a “rain tax”), those impacted by the fee are speaking out in opposition. Whether through social media posts such as Facebook groups, through letters to local political representatives, or attending public meetings, citizens are expressing their skepticism and outright anger with respect to the motivation, usefulness and amount of the various stormwater fees that are being assessed throughout the Commonwealth.

The highest visibility of such fees takes place within the Chesapeake Bay watershed, for which state and federal agencies and private groups have spent many years formulating and pursuing a cleanup strategy to reduce the flow of nutrients such as nitrogen, phosphorous and sediment from local waterways. Pennsylvania is largest contributor of fresh water to the Chesapeake Bay, and by far the largest contributor of nutrients, which promote growth of algae blooms in the Bay, robbing the Bay of valuable oxygen and sunlight which inhibits and reduces sensitive habitats for shellfish and other aquatic life once teeming in the Bay.

Local municipalities which contain urbanized areas and separate storm sewer systems are required to meet certain pollution reduction requirements through their stormwater management permits, known as MS4 permits. In order to better manage stormwater in a way that allows municipalities to reduce the amount of nutrients being discharged local waterways, and ultimately the Chesapeake Bay, funding is necessary to make system improvements or develop “best management practices” that accomplish these nutrient reduction goals. Of course, municipal projects such as these cost money, and with budgets already stretched thin, stormwater fees are a way for municipalities to fund these programs.

In the typical circumstance, the fees are assessed to property owners based upon the amount of impermeable or impervious surfaces (driveways, parking lots, rooftops) that exist on an individual property. Some municipalities, or municipal authorities which encompass multiple municipalities (such as the Wyoming Valley Sanitary Authority), impose minimum fees for each category of residential, commercial, and agricultural properties, and then additional fees based upon the amount of impervious surface, if any. Different municipal entities are calculating fees in different ways; however, the end result is the same – an additional financial burden being placed upon local property owners to help fund a mandate from the federal government.

One common argument is that this fee is simply a new tax in disguise, and many people are angered by the idea of new municipal taxes. However, the major difference is that the fee is actually more far-reaching than a tax in that typically tax-exempt properties, such as churches and schools, are not exempt from the stormwater fee. While this may be a good thing for those who are not tax-exempt in that they feel that tax-exempt property owners are sharing the load, the downside is that many of these tax-exempt entities are faced with excessively large stormwater fee obligations due to the size of their impervious surfaces, particularly schools and religious institutions that have large impervious parking areas.

Challenges to these fees are popping up all over the Commonwealth as well, in the form of lawsuits and intervention from politicians. Recently, US Representative Dan Meuser, who represents many of the thirty-two (32) local municipalities that are members of the WVSA, has called for a suspension of the fee until there is a better understanding of them and how they might be reduced. Meuser claims that many of his constituents were “blind-sided” by the fee, despite the amount of publicity stormwater fees have been receiving state-wide over the last several years. Nonetheless, the fact remains that challenges to these fees are becoming as common as the fees themselves. Only time will tell how these matters will be played out in the court system or through the political process.

If you have any questions about stormwater fees in Pennsylvania, please call Paul Bruder at 717-232-5000, or email at pjbruder@mette.com.

Drinking Water

PFAS Takes Center Stage in Pennsylvania

Drinking Water

By: Paul Bruder, Esq.

Chemicals historically used in products such as non-stick cookware, flame retardant fabrics and fire-fighting foam, although no longer used in the United States, nonetheless continue to show up in public and private water systems across the United States, as well as in soil, because these chemicals – individually PFOA (Perfluorooctanoic Acid) and PFOS (Perfluorooctane Sulfonate) – do not break down naturally in the environment. PFAS (perfluoroalkyl substance) has been linked to some forms of cancer and other illnesses, and there is growing evidence of its link to elevated cholesterol, low birth weight and thyroid problems.

While the United States Environmental Protection Agency begins its process of setting maximum contaminant limits for the PFAS chemicals, and various bills make their way through Congress which would make PFAS a hazardous substance under the Federal Superfund Law (“CERCLA”), Pennsylvania is also exploring the idea of setting its own state-wide health standard  for the PFAS compounds.

The Pennsylvania Department of Environmental Protection will evaluate the effects of PFAS on human health in order to develop standards above which consumption or ingestion of PFAS would potentially be harmful to humans. DEP currently monitors a dozen or more sites around the Commonwealth for PFAS contamination, and has tentative plans to begin monitoring of other systems later this year. Although other states have already performed studies and developed their own PFAS limits, most of which are stricter than EPA’s current health advisory level of 7 parts per trillion for combined PFAS, DEP appears intent on performing its own independent studies and determining appropriate maximum contaminant levels rather than piggy-backing off of the work done by others.

Should PFAS be designated a hazardous substance under the Superfund program, that would allow federal agencies to clean up sites contaminated by PFAS. However, such a move would also signal potential liability exposure for manufacturers, distributors or others involved with PFAS. CERCLA is a very broad environmental liability statute which can potentially encompass current owners or operators of the facility, past owners or operators of a facility, generators and other parties that arranged for the disposal or transport of hazardous substances, as well as actual transporters of the substance. Therefore any company or entity that was in any way involved with the generation, transport, or ownership of property that is in any way connected to PFAS should begin to assess its potential liability in the event that PFAS becomes covered by CERCLA

Recently, Governor Wolf announced the approval of funding through Pennsylvania’s Commonwealth Financing Authority for projects that will remove PFAS from 17 wells in the Warminster/Horsham and Warrington areas of Bucks County, and New Jersey’s Department of Environmental Protection ordered five companies to pay for the contamination caused by PFAS in that state. Two days later, New Jersey sued DuPont and Chemours over PFAS-contaminated water and soil.

PFAS is fast becoming one of the hottest topics in environmental law, statewide and nationally.  Expect this trend to continue.

For more information about PFAS liability or exposure, please contact Paul J. Bruder at 717-232-5000, or pjbruder@mette.com.

Home Inspectors

Attend Inspections

PART TWO

By: James L. Goldsmith, Esq.

Home Inspectors

 

Who, if anyone, should attend home inspections has been a topic of debate for as long as home inspections have been a standard element in a residential transaction.  Year ago when the topic came up at an NAR meeting of attorneys who represented state associations of Realtors, the room was divided, with roughly 50% saying that buyers should attend, but not their agents.  I remember one outspoken attorney claiming that if an agent was not present to hear the spoken word of the inspector, he/she could not be charged with failing to pass the inspection comments on.  As for me, I am not a supporter of “see no evil” or “head in the sand” approach.

Most of the lawyers at that NAR meeting, however, agreed that buyers should attend inspections.  The reason should be obvious, but consider a recent transaction where the buyer sought an inspection of the sewer lateral from the home to the municipal system located in the street.  The inspection primarily consisted of snaking a video camera through the lateral and visually assessing its condition.

The seller agreed to be present for the inspection so he could open the door to the inspector and direct him to the location of the line in the basement.  Neither the buyer nor the salespersons involved in the transaction chose to attend.  The seller, who was curious, watched the process and conversed with the inspector during the inspection.  As they watched the monitor, the inspector pointed out dips in the lateral and explained they were probably caused by substandard work when the house was constructed.  The inspector felt that the stone bed in which the lateral was placed was not sufficiently compacted and offered other criticisms that were either an educated opinion or complete conjecture.  He also expressed that the dips would get worse over time.  When the seller read the report he was surprised to see that, while the dips were mentioned, there was no reference to the hypotheses that were verbally expressed by the inspector.  The seller was so concerned that he contacted his lawyer questioning whether he had a disclosure obligation that went beyond the written report.

It happens all the time.  The inspector is generally all too happy to discuss his findings and the possible implications of those findings as he pokes about shining a flashlight in dark corners, behind water heaters and above drop ceilings.  Yet, it’s very likely that what will appear in the written inspection report will be an abbreviation of those comments, if they are mentioned at all.  Wouldn’t it be beneficial to the buyer to have the opportunity to ask the sewer inspector what causes dips, whether they remain stable and what is likely to happen over how many years?  More information is better.  When buyers are told to focus not only on written conclusions, but also the inspector’s musings and mutterings they will get more out of the inspection.

Home Inspectors

Untimely Repairs

PART ONE

By: James L. Goldsmith, Esq.

Home Inspectors

 

It happens.  Sellers agree to make repairs suggested by a home inspection, but fail to complete the job timely.  When this happens a buyer is faced, unfairly, with proceeding under a contingent plan (e.g., having repairs made post-settlement or taking cash in lieu of repair) or of delaying settlement.  Usually there is little choice.  The buyer is packed and ready to move or the mortgage commitment can’t be extended, etc.

What prompted this article was a recent call to the Hotline involving a transaction where seller was to have conditions repaired before settlement.  For any number of reasons the repairs were not made.  Buyers only learned of sellers’ failure at the pre-settlement walk-through.  The seller acknowledged the failure but offered to issue a check payable to the repairperson that would be given to buyers at settlement.  When the buyers expressed their dissatisfaction, sellers became indignant.  How unreasonable of the buyers not to accept a check in the full amount the repairperson had estimated!   Likewise, the listing agent was incredulous that the buyer agent didn’t find this to be an acceptable alternative to what had been agreed to: repairs made before settlement.

An agreement is an agreement is an agreement.  If it was agreed that repairs were to be made before settlement!  It really doesn’t matter that the sellers and listing agent feel that providing a check in the amount of the repairs is an equivalent.  It is not.  Repairs frequently lead to the revelation of other issues requiring repair.  The cost of materials can rise.  Estimates are not always guaranteed.  Repairpersons go out of business or get sick or worse.  Further, the parties agreed that the burden of resolving the matter would be borne by sellers.  When the sellers deliver a check at settlement, the burden of repair falls on the buyer.  This was not the bargain the parties struck.

Certainly a buyer can hold firm and demand that the terms of the agreement are honored.  But, at the price of delaying settlement and the well-made plans of buyer, this is usually not a satisfactory alternative.  Further, listing agents and sellers quickly understand that buyers may have little choice.  What do you, as a listing agent, consider appropriate?   Beyond the legal obligation, is there a moral obligation that your sellers complete the tasks that they agreed to undertake?  RELRA requires licensees to advise their clients of the status of the transaction and an argument can be made that as a listing agent you have an obligation to poke in every now and then to determine that your seller is complying with their agreement.  Should a buyer agent be inquiring as to the status of repairs at the risk of being labeled a pest?

The fact is, buyers have a right to enforce the agreement, including seller-promised repairs.  While it is rare that a buyer will refuse to attend settlement until the terms of the agreement are satisfied, it happens.  Further, if I were negotiating on buyer’s behalf, I might anticipate delays in repair and, as part of the change in terms agreement, require that repairs not made by settlement will exact a payment into escrow at settlement of 1 ½ to 2 times the projected cost of repair.  It’s not customary, but I do know agents who make this a routine point of negotiation when repairs have to be undertaken.

The best transactions occur when a seller receives all of the purchase money at settlement and where the buyer receives all of the property promised, at settlement.

farm joint ownership

Untangling Joint Ownership of Real Estate

farm joint ownership

By: Ronald L. Finck, Esq.

It is not uncommon in the farm community for real estate to be owned jointly by two or more owners.  Many times, parents will transfer their real estate to more than one child as part of their estate and farm succession plan.  Joint ownership of real estate often presents unique problems for the joint owners.  A co-ownership agreement should be considered to set forth how the joint owners will use the real estate and how the expenses associated with the real estate will be paid.  That agreement could also address what the rights and responsibilities of the owners would be in the event of one of their deaths or if one of the joint owners decides to separate from the joint ownership.

If one or more of the owners decide they no longer want to be joint owners and if the joint owners cannot agree on a sale of the property or how to divide the property among themselves, the Pennsylvania legal system provides a remedy known as partition, which allows joint owners of real property to sever their ties to one another.  In some ways, partition is like the division of property in a divorce.  Two or more parties are splitting their jointly-owned assets and going their separate ways.  Unfortunately, like divorce proceedings, partition can be costly, time-consuming, and full of aggravation.

In Pennsylvania, partition is a two-step process.  First, the court determines whether partition is appropriate.  Second, the court determines how the real property should be divided up so that each joint owner receives a fair payment or distribution.  The first step to partition is relatively simple.  Any party with an ownership interest in real property has a right to have the property partitioned.  Therefore, all that the party seeking partition has to do is show that he or she has an ownership interest in the property.  Partition does not require the consent or permission of the other joint owner(s).

Determining how the property should be equitably divided among the joint owners is often much more difficult.  Frequently the court will employ a special master to assist with the process.  The first thing to be considered is whether the property can be physically divided.  If a court finds that the property can be physically divided, it must physically divide the property and award each joint owner his or her respective share.  This process may be relatively uncomplicated when dealing with large, undeveloped, and unimproved tracts of farmland or woodland.  More often, partition involves property that is improved with buildings or other improvements that are not easily divisible.  Further, factors such as zoning regulations, access to public roads, soil quality, agricultural conservation easements, etc., can prevent or complicate an equitable division of the property.  Thus, the court must find a way to equalize each joint owner’s share.

Equalizing the shares can be an onerous process, rife with potential for disputes.  Sometimes a joint owner will have to pay another joint owner a sum of money in order to equalize the interests.  If the parties are unable to agree on who gets what part of the property, or if there are more joint owners than parts into which the property can be divided, the court may auction off the parts between the joint owners and make awards of money, real estate, or both, to the parties according to their ownership interests.

Income tax consequences of the division and sale of property is another consideration.  If the division involves two or more properties that are not adjacent to each other, the division may have to be structured as a like-kind exchange under IRC §1031 to defer income tax consequences.

If the court finds that the property cannot be physically divided, it can order that the property be sold.  Such a sale may be limited to the joint owners or open to the public, depending on the circumstances.

The attorneys at Mette, Evans & Woodside can assist you with the various complex issues that can arise from the joint ownership of real property.

Real Estate What If Question

What if?

Real Estate What If Question

By: James L. Goldsmith, Esq.

These two words are the start of many questions by those who draft contracts, including agreements for the sale of real estate.   Consider Paragraph 18 of the PAR standard agreement entitled Maintenance and Risk of Loss.  This paragraph was borne of the following “what ifs?”  What if the HVAC system or other systems fail after signing but before settlement?  What if the seller is unwilling to repair within the sale price agreed upon?  What if the seller, instead of repair, promises to credit the buyer with the fair market value of the system at the time the agreement was reached?  What if the seller refuses to do anything?  What if the buyer is willing to make the repair and what if the buyer is not?  And you could go on and on and on.

Well drafted agreements are more likely to go beyond basic terms in order to deal with the possibility of intervening events.  Having an agreement that charts a path through all of the possibilities means that the parties don’t have to pause when one of these events occurs in order to negotiate a resolution.  The problem is anticipated and the fix covered.

When teaching, I frequently reference the fact that the agreement of sale is 14 pages long because it covers all of the possibilities and eventualities.  We could strip the agreement down to a 3-4 page agreement, but then when issues arise we would be stuck negotiating a new set of terms and conditions.

The problem addressed by this article is that when agents encounter a situation not covered by the agreement or a standard addendum, they may draft an addendum that doesn’t ask all of the “what ifs.”  This usually happens when the parties are drafting a change in terms addendum following an inspection report that reveals a problem.  When a buyer agent proposes that the seller make a repair, has the agent asked what will assure that the seller selects a qualified, experienced repairperson who will use A-grade materials versus a semi-qualified handyman who uses salvaged parts?

A recent call to the Hotline underscores the problem when the “what ifs” are not asked.  The property in question was serviced by a septic system that failed the buyer’s inspection because of a saturated drain field.  The drain field was wet, perhaps because of a malfunction, but certainly because of the heavy rains and snow that preceded the inspection.  The buyers were gung-ho on going forward with the purchase, but they certainly wanted recourse if a subsequent inspection found a problem.  With the “help” of their agents, the parties agreed that seller would get approval of the drain field by July.  Settlement was March 1.  In late March there was a major sewage back-up that may be related to the drain field.  Seller refused to take any responsibility saying that the agent-drafted agreement merely said that the seller would obtain a passing inspection by July.  July was months away; regardless, the agreement didn’t say that the seller had responsibility if seller couldn’t obtain a passing drain field inspection.

It’s clear that the buyers’ agent hadn’t asked “what if the seller is unable to obtain a report that the drain field was in satisfactory condition?”  In fact, the agent missed asking a whole lot of “what ifs” and the result was an abysmal set of words that covered little.  The aftermath will include litigation.

Effective draftsmanship is a skill and my belief is that licensees are not well trained in it and should probably defer to published standard forms and lawyers.  There is a legal doctrine that holds that ambiguities in draftsmanship are construed against the draftor.  This means that whoever penned the ambiguous language will find that the interpretation accepted by the court is the one most favorable to the other side.  If you wheeled the pen you better draft well and in a manner that can lead to no confusion.  There is nothing wrong with asking your clients to obtain the advice of their counsel.  There is nothing wrong with using tried and true standard forms that go through rigorous scrutiny.  Best of all, however, is having a transaction close only when all lingering doubt, problems and contingencies are resolved.  When the buyer gets everything bargained for in exchange for the full consideration, there are few “what ifs” that have gone unanswered.  Put money in escrow to cover a roof repair and we begin to think what if the repairperson finds more damage than was anticipated; what if a contractor can’t be engaged to complete the work before the balance is to be returned to the seller; what if  . . . what if . . . what if.

Copyright © James L. Goldsmith, Esquire, 2019  |  All Rights Reserved

Mr. Goldsmith is an attorney with Mette, Evans & Woodside and serves as general counsel to PAR.  A substantial portion of his practice is dedicated to providing advice and counsel to real estate licensees. He and his firm represent and defend real estate salespersons and brokers in civil lawsuits and licensing claims across the Commonwealth. Jim also defends Realtors® in disciplinary hearings conducted by the Real Estate Commission. He routinely counsels employers on employee relations issues and is one of the voices of the PAR Legal Hotline. 

The Importance Of Safety In Filling Heating Oil Tanks

By Paul J. Bruder, Esquire

As the weather turns colder and air conditioners give way to furnaces, homeowners call their heating oil providers and say “fill’er up.”

More than 100,000 homeowners in Pennsylvania heat their homes with oil, meaning that their basements are homes to large, typically 150 gallons or more, heating oil tanks.

Despite sometimes high costs, oil heat remains an efficient, clean and safe way to heat a home. However, the dangers and hazards associated with home heating oil often result from problems during the filling of those tanks. Having a grasp of the common risks can be helpful when working with clients selling or buying a home serviced by oil heat.

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Getting Creative

By James L. Goldsmith, Esquire

Agreement Photo

The most dangerous clause in the Standard Agreement for the Sale of Real Estate (ASR) is found in our current Paragraph 32(B), Additional Terms. Here’s where agents can let loose with the most creative use of the pen imaginable! A problem is, that when these works of art fail for any reason, they are likely to penalize the author (agent) and his or her client. Most of you are familiar with the legal maxim “ambiguities are construed against the drafter.”

We, the Hotline attorneys, hear from many of you who understand the potential risk of drafting special clauses and who want us to provide the language. Involvement in a specific transaction is beyond the scope of what the Hotline provides, but I understand why you ask. You really want to help your client even if it involves undertaking a job with which you are not completely comfortable. You think your client may think less of you if you say that this is something you don’t traditionally provide or that feel uncomfortable drafting the language.

Entering into an agreement of sale involves risk. The risk belongs to the buyer and seller. Drafting unique provisions that may be required in a particular transaction has tremendous impact on the buyer and seller. Out of concern for your client, it is best to refer them to a lawyer experienced in the type of transaction in which your client is involved.

Some modifications may be easily made without resorting to lawyers. Unless the modification is one commonly made, discuss the issue with your broker or office manager and have them review any language you propose. Better to have someone else draft it and have it be their problem.

To be sure, the Pennsylvania Supreme Court has ruled that real estate licensees may draft agreements that arise from the efforts of a licensee in a specific transaction without engaging in the unauthorized practice of law. That decision, however, dates back to 1934 and times have changed. Today, it is fairly easy to rely on the standard agreement and the many standard addenda available. It’s rare that a transaction calls for unique or specialized language and if that is the case then it’s likely to be a complicated provision. Rather than tackle a drafting challenge, refer the buyer or seller to their lawyer. Not only will you duck any potential bullet, you won’t have the angst of doing something you are uncomfortable with. Not only that, your pay remains the same and your client is getting the level of service he or she needs.

When a Hotline caller asks me to help draft special clauses I, of course, delve into the situation and the need for unique language. The explanations vary. One recent caller was trying to accommodate a 1031 exchange. I asked how many 1031 exchanges the agent had handled and the answer was “this is my first!” I advised that after 40 years of practicing law I did not feel comfortable handling 1031 exchanges as I’ve referred these transactions to my tax attorney partners in the practice who know what they are talking about. Tell the client that the task falls outside of the scope of what a licensee skilled in the marketing and sale of real property generally undertakes. Refer your client to an attorney. It is my belief, that undertaking such a task may very well fall under the unauthorized practice of law, in addition to subjecting you to license revocation or disciplinary measures.

Another caller was trying to draft a swimming pool inspection clause. This one was easy because it is already in the agreement in Paragraph 12, Home/Property Inspections. If you have any concern write that the swimming pool is one of the items to be inspected pursuant to the elected inspection provision.

Lawyers are criticized for taking a simple concept and turning it into a page-long provision. The reason, however, is that lawyers understand the importance that no ambiguities exist and that every “what if” is addressed so that there are no questions. And we don’t always get it right.

In this business the pen is indeed far mightier than the sword. Wield it carefully.

Copyright © James L. Goldsmith, Esquire, 2018
All Rights Reserved