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The Objection List That Arrived at 9:15 p.m.

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The Objection List That Arrived at 9:15 p.m.

An Iowa residential purchase agreement is accepted Saturday, March 1, at $284,000, with a 10-day inspection contingency, a 5-day seller response period, and $5,000 earnest money. Key terms: "Notices must be in writing and are effective on receipt. Email sent to the address stated in this agreement before 11:59 p.m. Central Time is effective on the date sent." "If the last day of any period falls on a Saturday, Sunday, or legal holiday, the period extends to the next business day." "If Buyer delivers a written objection list, Seller shall respond in writing within 5 days. If Seller does not respond within that time, Buyer may terminate this agreement and receive the earnest money."

The inspector finds a cracked heat exchanger and radon at 5.1 pCi/L. The buyer's agent emails the objection list at 9:15 p.m. on Tuesday, March 11. The seller's agent emails back on Tuesday, March 18: "Seller will replace the furnace. Radon is on the buyer."

1. Was the buyer's objection list timely? Walk through the counting and identify the risk.

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Counting: when a period runs "from" an event, the day of the event is excluded. Acceptance was March 1 (Saturday). Day 1 is March 2; day 10 is March 11. March 11 is a Tuesday, so no weekend extension applies.

Delivery: the notice clause makes email effective on the date sent if sent before 11:59 p.m. Central. The email went at 9:15 p.m. on March 11 to the stated address. On the contract's own terms, the notice was timely.

The risk to flag: if the form had used language counting the acceptance date as day 1, the deadline would have been March 10 and the notice would be one day late - and a one-day-late objection list is, in practice, a lost inspection contingency. That ambiguity is not something to discover on day 10. The correct practice is to read the counting convention before the deadline and, if the form is unclear or the parties may disagree, deliver early or get a signed written extension. Never let a contingency run to the last evening.

Practical note: the listing agent should confirm receipt in writing ("received 3/11 at 9:15 p.m.") to eliminate any later dispute about when it was received.

2. What is the legal effect of the seller's March 18 email? Is the seller obligated to replace the furnace? Is the contract terminated?

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Deadline: the 5-day response period began on receipt, March 11. Day 1 = March 12; day 5 = March 16, a Sunday, so the period extends to Monday, March 17. The seller responded March 18 - one day late.

Effect of a late response:

  • It is a counterproposal with no legal effect unless the buyer accepts it in writing. It does not bind the seller to replace the furnace, and it does not bind the buyer to take the property with the radon.
  • The contract does not automatically terminate, and the seller's silence does not automatically obligate the seller to cure the buyer's whole list. The remedy clause gives the buyer an election: terminate and recover the earnest money, or keep the contract alive.
  • If the buyer does nothing and closes, the buyer has effectively accepted the property in its inspected condition, radon included.

What the buyer's agent should do now: deliver a written election promptly - either (a) accept the March 18 counterproposal in writing and proceed, or (b) give written notice that the seller failed to respond and the buyer elects to terminate and demands release of the $5,000. Do it in writing, do it before the closing date, and do not let the closing date pass while the contingency sits unresolved, because proceeding to closing can waive the objection entirely. Either way, confirm the seller's response deadline calculation in writing so the next dispute is not about the calendar.

3. How is the earnest money handled if the parties disagree, and what does the radon finding mean going forward?

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Earnest money: the $5,000 sits in the listing brokerage's trust account. It cannot be disbursed on either party's unilateral demand. Release requires either a written release signed by both parties or a court order (or the dispute-resolution procedure the contract specifies). A broker who pays one side on a phone call has converted client funds. The buyer's agent should transmit the termination notice plus a written release for the seller to sign; if the seller refuses, the funds stay in trust and the buyer's remedy is the contract's dispute mechanism or court.

Radon: 5.1 pCi/L is above the EPA action level of 4.0. It is a health and safety condition affecting the property, not a cosmetic complaint. Two consequences:

  • If the deal dies, the seller now knows about an elevated radon result and the cracked heat exchanger. That knowledge must be disclosed to subsequent buyers in the seller's disclosure and in any subsequent listing - a licensee who helps paper over a known material defect is exposed on both license law and fraud theories.
  • If the deal survives, get the agreed scope in writing (furnace replacement with documentation; who pays for mitigation; whether the $5,000 stays at risk if the buyer later objects). Verbal assurances about a heat exchanger in an Iowa January are how a January carbon monoxide claim gets built.