Do sellers have a duty to respond promptly to all offers?

QUESTION:  I represent a seller. Last week, a buyer’s agent (I’ll call him Bob) called me and said that his clients were interested in a house I have listed but that they could only offer an amount $30,000.00 below the listing price. Before submitting a written offer, Bob asked me to check with my client to see if he would consider selling for the lower price. After several conversations back and forth, we reached a verbal agreement on a selling price. Bob said he would get me a signed offer as soon as possible. Bob submitted an Offer to Purchase and Contract the following day. By the time I received that offer, I learned that another showing of the house had been scheduled for that evening. My client did not want to sign the offer in hand until he knew whether the showing would result in a second and better offer. As it turns out, the showing did result in a second, much better offer, the following morning. After first obtaining my client’s consent, I called Bob and told him that there was now a higher offer on the table. He was extremely upset about potentially losing the sale. He told me that “we had a deal” and that I had acted illegally and unethically by letting my client delay in signing and returning his clients’ offer. Is Bob right? Did I do something wrong?

ANSWER:  Bob is wrong. It appears that you handled the entire situation both legally and ethically.

The North Carolina Real Estate Commission Rules require the timely delivery of certain instruments. The applicable provision is Rule 58A.0106(a). It requires, with some limited exceptions, that brokers deliver a copy of any written agency agreement, contract, offer, lease, rental agreement, option, or other relation transaction document to their client or customer within three days of the broker’s receipt of the executed document. While all offers must be presented, even if there is a contract pending, there is nothing in Rule .0106(a) (or anywhere else in the Rules) that obligates brokers, or their clients, to respond to any offers received within any particular time frame.

Standard of Practice 1-6 in the REALTOR® Code of Ethics states that REALTORS shall submit offers and counter-offers objectively and as quickly as possible. However, the Code of Ethics contains no provision requiring that offers be “quickly” accepted, rejected or countered.

In this case, the fact that your seller client had verbally agreed to a reduced price does NOT mean that an enforceable contract was in place. The parties clearly contemplated that any agreement would be reduced to writing, and that it would have to be signed by all parties before it became an enforceable contract. Your client had every right to hold the first offer until he knew whether the second showing would result in a better offer.