Time for Acceptance
Realtor® Legal Tip - (1) What happens if the offer expires but the party wants to accept it? (2) Do you have to extend the "response time" if you are sending over a counter offer?
Simple facts - Suppose the Buyer makes an offer and gives the Seller until the next day at 6pm to accept the offer. The 6 pm time for acceptance comes and goes and the offer is not accepted or countered. At that moment the offer is "Voidable" at the option of the Buyer.
1) Scenario 1 - Continuing with the above, let's now say the next day at 10am the Seller decides to just accept the offer outright. Can the Seller accept this offer?
2) Scenario 2 - Instead, let's suppose the next day at 10am the Seller decides to counter the offer. How should the Seller's agent handle this?
Scenario 1 - Since the time for acceptance expired, the Seller does not have the legal ability to accept that offer. Remember, Section 25 of the REPC does not provide a "response time." In our industry we need to get away from referring to it as a "response time." Instead there is a "Time for Acceptance." If that times expires, Section 25 says the offer shall "lapse." In other words, that offer is no longer on the table. With that in mind, if the Seller still wanted to accept the offer even though the "Time for Acceptance" lapsed, the Seller could only counter the offer. Why? Because the original offer was no longer on the table. The Seller failed to comply with an essential part of that offer - i.e., the Time for Acceptance. That section of the REPC was essentially rejected because the deadline lapsed. So, the Seller would need to send a counter offer to the Buyer and simply indicate that the terms of the offer are accepted but give a new "Time for Acceptance" of the counter offer. In the counter offer you aren't extending a "response time" because (1) there is no "response time," and (2) your counter offer will be creating an entirely new "Time for Acceptance." Once the buyer receives the counter and signs and marks the acceptance box and communicates the acceptance there is now a valid contract.
Scenario 2 - This one is easy. A counter offer legally does not need to be sent back to the other party prior to the original "Time for Acceptance" that is given. So even if the counter offer goes back to the Buyer after the original "Time for Acceptance" has lapsed, that's OK. The reason is because the counter offer creates an entirely new "Time for Acceptance" (and may include other modified terms). There is no need to extend the original "Time for Acceptance" because by sending the counter offer you are creating an entirely new "Time for Acceptance."
Should the Seller choose to just ignore the offer and not respond, that could indicate a "Rejection". It would be a good practice to contact the Sellers Agent and request that the offer be signed under the Rejection section by the Seller. That way you would know for sure that the offer was actually presented to Seller.