Can a client make changes to the pre-printed language on a NC REALTORS© form?
QUESTION: My client received an offer from a buyer on a Standard Form 2-T, and before signing, my client crossed out paragraph 12 (“Delay in Settlement/Closing”) on the form. I told him not to, but he would not listen. The buyer initialed the change when he received the 2-T back. The transaction has been moving forward, however, the closing is scheduled for next week and the lender does not look ready to close. My client does not want to give an extension. Is this sale dead if we do not close on the scheduled date? Was my client allowed to cross out paragraph 11?
ANSWER: Your transaction is not dead if you do not close on the scheduled closing date. Since your client crossed out all of paragraph 12 and presumably did not specifically make “time of the essence” regarding Settlement, he will only be able to terminate the contract under North Carolina case law if the buyer does not close within a “reasonable” time. What constitutes a reasonable time is completely undefined and depends entirely on the particular circumstances.
Your client was allowed to cross out paragraph 12 of the standard form. Hopefully you were able to keep a writing, such as an email, to show that you advised him not to delete any part of the form. Under the NC REALTORS© Forms Policy, “[r]evisions to the format or pre-printed content of any Transactional Form are prohibited.” However, this policy is meant to prevent parties or agents from changing the content of the form in such a way that the change is not apparent to other parties or agents involved the transaction. Deletions such as the one your client performed are obvious and provide documentation of the change such that everyone can be on notice.
You should know, however, that you do not have the same freedom as your client when it comes to making changes to the Standard Form 2-T. The purpose of this form is to define the legal rights of the parties to the real estate transaction. As an agent, and not a party to the contract, you are prohibited from practicing law under N.C.G.S. § 93A-6. If you were to make changes to the form, or even just recommend changes to your client, you could be violating the license law. Not every change to the Standard Form 2-T would be considered such a violation, but you should act cautiously in these kinds of circumstances and seek your own legal advice first. And, if you are part of a bigger firm, be sure to consult your firm’s internal policy on changes to forms.
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