Legally speaking: Can an offer be accepted after it’s been rejected… PART II
On August 26, 2013
By Peg Ritenour, OAR Vice President of Legal Services/Administration
Last week I posted an article about whether buyers who have rejected a seller’s counter offer — and the seller had been notified of that fact — can change their mind and accept the seller’s counter. The answer I gave was “No!” This sparked quite a few questions and comments.
Most of the questions centered on whether a rejection needs to be in writing to be effective — and if it’s only verbally rejected, whether that would allow the buyers to change their mind and try to accept the counteroffer. Another party asked if it mattered that the seller’s counteroffer hadn’t expired yet (i.e., the counter is rejected on August 26th, but was open for acceptance until August 28th). The answer to both of these questions is “no.”
As most REALTORS remember from their real estate law class, under Ohio’s statute of frauds, a purchase contract must be in writing and must be signed to be enforceable. However there is no similar legal requirement that a rejection must be done in writing or be signed to be effective. Therefore a verbal rejection is sufficient. Of course it is always a good business practice to get a rejection in writing because it documents that the offer was presented and the party’s rejection. However if the offer or counter is rejected and that fact is communicated — even verbally — that offer/counteroffer is terminated. That means it is no longer open for acceptance, regardless of whether the original expiration date hasn’t passed yet. The rejection terminates the offer/counter and it is off the table unless the other party (in this scenario the seller) is willing to put it back in play.
The “take away” for REALTORS should be to counsel their clients to be sure about their decision to reject an offer. Once they direct their agent to communicate to the other party that they are rejecting an offer or counteroffer and that notification is made, there is no “do over!” Because communicating a rejection isn’t something that must be done immediately, sleeping on a decision is sometimes the best advice you can give your client.
More information on Ohio contract law can be found in OAR’s Basic Contract Law/Purchase Agreements White Paper.
Tags: legal, Legally Speaking