Back Up Offers
Posted by admin on February 1, 2011 | No Comments
Back up offers are offers that are accepted by a Seller, after they have already accepted an earlier offer. The back up offer is accepted “Subject to the Seller ceasing to be obligated in any way under the previously accepted Contract of Purchase and Sale on the subject property by a certain date”. Realtors® are very careful in assisting the Sellers they are representing so as to prevent the Seller from inadvertently being under contract to sell the same property to two different Buyers.
An interesting question arises when the Seller and the first Buyer wish to amend the first contract. Does the second Buyer have a right to protest that any change to the first contract constitutes a collapse of that first contract? The answer is “that depends”.
In a recent Provincial Court of British Columbia decision the court concluded that amending non fundamental terms of the contract did not cause the first contract to collapse. In that particular case only the completion dates and deposit amount were being changed.
What if something as basic as the price were changed? The court ruling might well have had a different outcome.
Bottom line is that if you are a Buyer in backup position and you become aware of changes on the first contract, get legal advice. If you really want to be able to buy that property you’ll need your lawyers’ opinion as to whether or not you can challenge that amended first contract.
Originally published in the Vernon Morning Star – July, 2009. To suggest topics for future articles or to ask questions, email Jane at jane@vernonrealestate.ca or call 250.503.3755.
