When a seller may want to wait to make agreed-upon repairs
12/03/2014 | Author: Editorial Staff
On the fourth day of a 10-day option period, my seller client started fixing five items that he agreed to repair in an amendment (TAR 1903). On the sixth day, the buyer sent the seller a notice terminating the contract under his termination option in Paragraph 23. My client is upset because he already repaired two of the five items. Is a buyer allowed to terminate during the option period even after the seller has started making repairs?
Yes. A buyer does not automatically give up his right to terminate the contract under the termination option when the seller agrees to make repairs. However, if the buyer checked Paragraph 7 of the amendment, he would have waived his right to terminate the contract under the option period once the amendment was effective.
Remember that under Paragraph 7F of the TREC contracts, the seller is obligated to complete all agreed-upon repairs prior to closing unless the parties have otherwise agreed in writing. A seller might want to wait to do repairs until after the buyer’s right to terminate under the termination option has expired or has been waived according to the terms of the contract.
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