Proper Use of Expiration of Offer Provision

QUESTION: My seller client just received a signed offer. The Buyer attached the standard Additional Provisions Addendum (form 2A11-T) to her offer and marked paragraph 1 to indicate that her offer will expire unless unconditional acceptance is delivered to Buyer by 5:00 p.m. next Thursday. All of the other provisions on the Addendum were marked “N/A”. My client wants to counter the offer with a price change. Should he also sign the Additional Provisions Addendum and deliver it to Buyer with his counter?

ANSWER: No. The only time a Seller should sign the Additional Provisions Addendum is if the Seller “unconditionally accepts” the Buyer’s offer. In that circumstance, since the Addendum is considered to be a part of the Offer to Purchase and Contract (form 2-T), the Seller should sign the Addendum to confirm that he has accepted all of the terms of Buyer’s offer.

If the Seller wants to change the contract in any material way before signing it, and a price change is clearly material, the document he returns to the Buyer is legally considered a counter-offer and not a contract. In that circumstance, there is no reason for the Seller to sign the Additional Provisions Addendum. The “Expiration of Offer” language in the Addendum is no longer appropriate when the offer (i.e. the counter) is being made by the Seller and not by the Buyer. Therefore, you should deliver the counter to the Buyer’s agent but you should not attach the Additional Provisions Addendum.

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