What does sole discretion mean? In terms of the Arizona Resale Residential Real Estate Purchase Contract, when discussing inspection/due diligence periods and the buyers’ right to cancel, it means a buyer can cancel a purchase contract for any reason they choose. They only need to have a reason.
Today I received a cancellation that dances on the edge of the definition. The buyers’ agent had selected the box for “Premesis Rejected – Buyer disapproves of the items listed below and elects to immediately cancel the Contract.” But there weren’t any items listed below. In fact, the only item mentioned under “Items disapproved:” was “Please see attached report (Inspection Report.)”
There were a handful of items in the inspection report (none of them a deal-breaker, in my humble opinion) … but which item was the cause for cancellation? What really had been disproved by the buyer? Technically, no reason was provided; the seller and I are left to our imaginations to determine which item was the one.
I say technically because this is the kind of item that, while it falls into a gray area, likely would turn into an exercise in futility should the seller claim no reason was given. True, no reason was provided on the form due to the agents’
laziness haste but several items were included in the inspection report and therefore implied as disapproved.
At least that’s how I’m reading it and, more importantly, how I’m all but certain the title company will read it. Perhaps if escrow had been at the title company I normally try to use the answer might have turned out differently, or the buyer would at least have had to sweat slightly because their agent incorrectly completed the form.
But at the end of the day, the buyer can cancel for any reason they deem fit during the 10-day (per the boilerplate, subject to adjustment) inspection period.
Considering my sellers were having some issues regarding their necessary purchase as the second half of the overall transaction, perhaps the cancellation is for the best. Only time will tell for certain.
[tags]Phoenix real estate, Arizona purchase contract[/tags]