14. Conditions of acceptance
In addition to all the conditions that the buyer intends to include in his promise to purchase, the mandatory form contains a final set of conditions relating to the commitment of the parties and the acceptance by the seller. This is found in section 14.
Consent of the buyer and the seller
The consent of the parties must not be tainted in any way at the time the contract is made. This principle here takes the form of a declaration by the buyer and seller at the beginning of clause 14.1 that states “[…] their consent is not the result of any representation or condition not contained herein.”
Deadline
The mandatory Promise to purchase form includes a deadline in clause 14.1. The buyer is irrevocably committed until the expiration of the deadline indicated in the promise to purchase.
The buyer’s commitment is firm and he cannot withdraw from his promise to purchase once he has signed it. This time frame that the buyer gives to the seller is at the buyer’s discretion. It can be very short, even a matter of hours, or longer, for example two or three days. It can also be several days, or even several weeks. It all depends on the nature and context of the transaction. A very short delay could easily be perceived negatively by the seller, who may feel that his hand is being forced. On the other hand, a delay of several days could put the buyer at risk, leaving the seller free to accept another transaction proposal that could be presented to him in the meantime. The broker’s advice on this subject is important; the acceptance period can set the tone for a potential negotiation.
The broker must inform the buyer that his promise to purchase has the effect of binding him to the seller as soon as he signs it. If he no longer wishes to buy and does not want his promise to purchase to be presented, he must forward a revocation of his promise to purchase to the seller as soon as possible, so that the seller receives it before accepting the promise to purchase.
For more information: Can a promise to purchase be withdrawn?
Seller’s reply
Clause 14.1 also sets out what happens to the buyer’s proposal depending on the seller’s reply. There are four possibilities: the seller can accept the promise to purchase or not accept it; he can refuse it or make a counter-proposal. If he accepts it, he must do so within the time frame allotted by the buyer. The buyer and the seller are then bound. If he does not accept it or simply does not reply within the deadline, the promise becomes null and void. The same happens if the buyer refuses the promise or opts to make a counter-proposal.
These scenarios, except for the one where the seller does not reply, are included in the Signatures section in the portion where the seller must sign.
Although clause 14.1 provides that the promise to purchase becomes null and void in the event of a counter-proposal by the seller, the broker does not have to restate all the terms of the promise to purchase with which the seller agrees. In fact, clause P2.6 of the mandatory form Counter-proposal to a promise to purchase stipulates that the conditions of the promise to purchase that are not modified in the counter-proposal remain unchanged. Only those changes requested by the seller should be recorded in the counter-proposal.
