The Offer Sent Against Instructions
Mei is a salesperson with Birch & Stone Realty. On May 2, buyer Jordan signs an exclusive buyer's service agreement for 90 days. On May 20, Mei shows Jordan a house listed by Apex Realty for $529,000. Jordan says, 'Write it up at $515,000 with a $20,000 deposit, subject to financing and home inspection.' Mei prepares the offer with a financing condition due May 27 and a home inspection condition that says only 'subject to a satisfactory home inspection.' The deposit is payable to Apex Realty in trust. Jordan texts Mei at 8 p.m.: 'I want my dad to see it tomorrow before we send anything.' Mei sends the offer that night because Apex has told her another offer is expected. The seller counter-offers at $522,000, deletes the home inspection condition, and gives Jordan until 6 p.m. the next day to accept. Jordan's dad sees the house at noon and says the foundation looks cracked. Jordan wants to accept the counter but keep the inspection.
1. Was Mei authorized to submit the offer on the night of May 20?
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Conclusion: No. Jordan's text was a clear instruction not to send the offer until his dad had seen the property.
Reasoning: The buyer's service agreement authorizes Mei to provide services, but it does not give her blanket authority to ignore the client's specific directions about an offer. An offer to purchase creates legal risk, including deposit exposure and potential liability if the seller accepts. When Jordan said he wanted his dad to see the house before 'we send anything,' Mei should have held the offer. Her belief that another offer was coming may explain her urgency, but it does not override the client's instruction. Sending the offer contrary to that instruction was a breach of the duty to follow lawful client directions and to act in the client's best interest.
What Mei should have done: Confirm in writing that Jordan wanted to wait, explain the risk of competing offers, and let Jordan decide. If Jordan then instructed her to send it, she should have documented that instruction. After the fact, Mei should tell her broker, preserve the text messages, and not compound the problem by misleading Jordan about what happened.
2. Is the home inspection condition in the original offer enforceable as drafted?
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Conclusion: The clause is poorly drafted and creates uncertainty, but the more immediate issue is that the seller's counter-offer deleted it.
Reasoning: A condition that says only 'subject to a satisfactory home inspection' does not identify a deadline, the scope of inspection, or what happens if defects are found. A court or the parties may interpret it as requiring the inspection within a reasonable time, but 'reasonable' is exactly the kind of dispute that a well-drafted condition should avoid. The safer clause would set a date and time for satisfaction or waiver, identify who pays for the inspection, and state that the buyer may terminate if not satisfied.
Effect of the counter-offer: A counter-offer terminates the original offer. The seller's counter at $522,000 deletes the home inspection condition. If Jordan accepts that counter as written, he accepts a contract with no inspection condition. Mei should not tell Jordan that he can accept the counter and still rely on the old inspection clause.
3. How should Mei advise Jordan on the seller's counter-offer?
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Conclusion: Mei should explain that the counter-offer has changed the deal and that accepting it as written would give up the inspection condition.
Reasoning: The seller's counter-offer is open only until 6 p.m. the next day, and it removes the home inspection condition. If Jordan accepts, he is bound to complete without that protection, even though his dad saw cracking. Jordan cannot simply accept the price and 'keep' the inspection; that would be a different deal. His options are to accept the counter as written, reject it, or make a further counter-offer that reinstates a properly drafted inspection condition with a deadline. A further counter-offer must be communicated before the seller's deadline and is itself a new offer that the seller may reject.
Mei's role: Confirm Jordan's instructions in writing, recommend independent legal advice if he is unsure, and do not pressure him because of the deadline. She should also review the financing condition and deposit terms. If Jordan wants an inspection, Mei should draft a clear condition, not a vague one, and explain that the seller may refuse it.