Broker dies & agent wants to cancel

14 Replies

Hi everyone! So I have a signed PA and have been waiting for negotiated repairs to be made. It's been a lengthy escrow as the seller didn't read the repair list well (speculating here) & finds himself spending more than anticipated. There's been some back and forth and meetings between agents and the contractor to clarify the scope of repairs. My agent just served an escrow extention to give them some more time to perform. The other side has yet to sign... The escrow date just passed. Our response back was this: The listing agent's broker passed away recently (after signed contract & addendums) and the agent is saying that he must re-sign with the seller and that our contract may be voided. It appears that the seller (and agent) are using this to get out of the contract. This property is in California. I'm curious if anyone has been in a similar situation and what course of action you'd recommend. Any and all input is appreciated. Thank you BP community! TJ

Two thoughts. First, the contract is technically between the Buyer and the Seller, not between Brokers. Even if the Broker dies, the Seller is expected to honor the contract.

Second, do you really want to force a contract with someone you can't trust?

I recommend you contact the California Bureau of Real Estate and report this. They can probably confirm if the Broker passed or not. If he did, they should be able to confirm who is acting in his place. If he's still alive or if there is a replacement Broker, a call from CBRE should be enough to motivate them to get their act together without you having to file a formal complaint.

@Nathan G. Thanks for your reply. I agree with you with respect to the contract. My question is to it's validity now that the agent doesn't have a brokerage to hang his license. I plan on holding the seller to the terms of the contract. I want to proceed, even though the seller has been a PITA.

Here is an article that explains the process. As I said, when the Broker passes, another person is assigned temporary responsibility to ensure contracts continue on.

If a replacement was not assigned then the listing agent wouldn't be licensed any more. That's why I'm concerned this is a lie to get out of a contract.

The listing agent is always licensed unless the state revokes it/ agent fails to renew it or they die. This is regardless of the Broker- at least in my state as they are separate licenses.

Technically the listing is the Brokers listing until it expires or gets cancelled. The agent can just go to another Broker- but
Can’t take the listing with them unless the broker or acting broker gives permission or when it expires.

One thing I will add: this is why it's best to just negotiate out price and do your own repairs. I would never trust a seller to make the repairs properly anyway, and this deal probably would have already been finished if it was price alone.

This has no bearing on Your contract with the seller....only the listing agreement with the broker, not your issue.

Call the local Board of Realtors, and ask them if they know if the Broker passed away, and if so, is another broker assuming listings, etc. and get the name. The local Board of Realtors are the ones that will be dealing with the acutal listings on MLS, etc. so they should have information. If not, then call the BRE. Also, have you gone to BRE online to check license status of the broker? THAT should be your first step.

Sounds to me as though the broker/agent already satisfied their agency duties by bringing together two willing and able parties. I don't believe the broker/client relationship has any bearing on your already signed contract. The contract is still valid as long as the agent was licensed at the time of signing, even if he/she loses their license status before the transaction has closed (at least this is how I understand it in WA).  

I agree with previous posts, the broker issue is not your problem. Your problem is now you have passed the escrow date without closing, so not only is the seller in breach for not completing repairs, you are in breach for not closing on the agreed upon date (because the seller never signed the extension agreement). Unfortunately, I would have to recommend that you seek the advice of any attorney, as agents are not licensed to give legal advice, and breaches and remedies of contracts are beyond our scope of expertise. 

That said, it sounds like you would still like to move forward, are there any repairs you would be willing to renegotiate? Or negotiate a price reduction in lieu of repairs so you can just get this thing closed? It's hard to advise you without having all the details, but you need to find out why the seller is hesitating and dragging his feet so you can figure out a solution that works for everybody. And show him why it's worth it to just finish up and close with you as opposed to going back on the market just to start the whole process all over again. 

Going back to JD Martin's point, leaving repairs up to the seller really just complicates things, especially when the seller's idea of a repair may be completely different than what the buyer was expecting or hoping for. When I negotiate inspections, seller credits or price reductions are ideal. Or, the buyer should bring their own contractor to get quotes on the repairs, then present that quote with their reponse, writing it up along the lines of "Seller shall have xyz company complete repairs in bid attached." It's more work for the buyer, but could potentially save a lot of trouble in the long run. 

Keep us posted on how it works out! 

As you stated escrow  date has passed the seller is not under any obligation to sell to you .

So there are a few things at work here....

First, if the COE has passed, you need to issue the Seller a Cure Notice (this could be called something different in CA) for breach of contract.  The Seller cannot just walk away as someone suggested.  They are in breach of contract because they did not perform to the contract by closing on time.

Instructions should be in your contract for how you (as a NON-breaching party) can put on notice the breaching party.

If you want this to continue, you need to document your steps.  The Cure Notice is the next step.  It gets issued to the Title company and the seller/listing agent.

Now, regarding the broker who passed away.  This is an internal issue between the listing agent and the broker and/or broker's managing broker.  It has to do with their commission as the listing is actually placed with the broker, so if he dies, a new one needs to be placed ASAP.  NONE of the agents can practice RE until this happens.  So, while it doesn't have anything to do with your transaction, it does mean the listing agent has to cease all activities until they are activated under a new broker.  Many offices have a managing broker or office manager that can step into this role for times like these.  In fact, I believe that each broker needs to name a person that would step in, in the event of an absence or death.

The point is....your deal is not dead just because the COE has passed, or the broker of the listing agent.  YOU just need to move forward with YOUR performance items (don't become a breaching party yourself).  Then, you may need to contact a RE attorney to get you to the finish line.

I agree with many of the sentiments here and thanks to all for chiming in. I agree wholeheartedly with @JD Martin , @Jenna Estefan and others that it's best to negotiate down to price only. Unfortunately the seller wanted the higher SP, but was willing to concede to repairs. I believe it's just a case of psychology here...not every seller thinks in terms of net proceeds. 

The repairs in question stem from a pest report and were essentially termites, sub floor, and a new roof. I negotiated these repairs for a good price and wanted to close the property with all the structural things completed. I backed this up with a seller-paid re-inspection of the property prior to closing. Although I generally do my own work, I was comfortable with MY agent's pest company doing the termites and having their contractor do the roof since our inspector would do the re-inspection and it would be subject to the city's permit process.

We are pursuing with the breach of contract (cause I've got nothin' better to no deals on the immediate horizon). 

Thanks everyone. Your comments are very appreciated!!


Hey @Araceli Gomez , check this thread out...

True! Each sale is so unique and every seller does have a different perspective. I'm surprised that this seller didn't see the advantage of a price reduction as opposed to completing the repairs, but you're right, sometimes it is just the psychology of it all. 

One other thought, our WA Association of Realtors has a legal hotline where we can ask an attorney these types of questions. Hopefully your agent is a Realtor and they have a similar benefit in CA. Something worth looking into. 

Good luck! 

sorry the accidental double post 

The listing agreement is probably void, as the listing was between the seller and the broker who is now deceased. The only thing remaining is the contract between the buyer and seller. You need to seek the advice of an attorney and find out what your options are. 

The selling agent on the other hand, if the deal is completed, probably will still be paid commission, having brought the buyer to the deal. The question is, if you've communicated with the selling agent, what are they saying as to who his license is now under, because without a broker of record, the agent can't do anything requiring a license. 

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