I'm not asking about what property managers write into their contracts. I've seen entire wish lists embedded into them. I realize that it is fairly common for property managers write in their contracts that the agreement survives sale. Assume that in this situation the property manager has included such a "survives sale" clause. Considering the fact that I never signed or agreed to anything and was never made aware of any obligations, does a clause claiming that the manager's rights "survive sale" have any legal grounds, or is this an unenforceable wish-list item that they throw in and hope it isn't challenged?

@Alexander V. unless there is a one-off last-line sentence in your state law written by a former property manager...or if they convinced the property owner to add them as a decision maker on the deed to the property, I'd say throw it in the trash and move on.  

I agree with @Brandon Sturgill .  Tenant survives the sale but not the PM.   Make sure you collect the deposit at closing so you are not chasing it after the close.  Get all tenant docs such as lease, contact info and ledger.  They will not give you a copy of the application or the credit check.   

Umm, I'm really not sure where you guys get that interpretation from. The same underlying legal principals that allow a lease to survive the sale apply for why the PM agreement survives the sale. By proceeding with the purchase knowing of the agreement and it's effect on the property you've agreed to the terms and to be bound by them. If you were completely unaware and find out after the fact, then your recourse is to break the contract under whatever provision is available and pursue the seller for the cost.

Originally posted by @Matt Devincenzo :

Umm, I'm really not sure where you guys get that interpretation from. The same underlying legal principals that allow a lease to survive the sale apply for why the PM agreement survives the sale. By proceeding with the purchase knowing of the agreement and it's effect on the property you've agreed to the terms and to be bound by them. If you were completely unaware and find out after the fact, then your recourse is to break the contract under whatever provision is available and pursue the seller for the cost.

 The problem is that if a tenant has a standing lease that survives the sale, that fact is included in the sales contract. No such clause about property management is [ever] included in a sales contract. The sales contract has my name on it, therefore I am explicitly acknowledging the existence of a lease and agreeing to inherit it (or explicitly refusing to). Not so with the property management agreement.

Moreover, tenants are explicitly protected by state law in many situations that would allow them to stay even if the seller failed to disclose the existence of a standing lease to the buyer. I've never heard of a parallel for a property manager.

The issue at hand is that unlike the lease, the property management company does not have an agreement WITH ME. The agreement is a direct line between them and the previous owner. It seems questionable to me whether that agreement can just float over and stick to me when I have never signed anything or even been notified of the existence of such an agreement.

I can't see how it would survive the sale.  The person who signed the contract no longer owns the property.  Let the seller sort it out with the PM.  It would be the same as them breaking the contract.

I'm no attorney, and certainly do not know the laws in states other than North Carolina, but I imagine your management agreement is between the owner of the property and the management company. The lease is between the owner (represented by the management company) and the tenant.  The owner decides to sell the property, so the lease would remain in force.  However, once the owner sells the property, the management agreement is nullified for the new owner.  I suppose I could see some "creative" agreement terms that binds the management agreement to the owner, entitling them to pay early termination fees, but it should not bind to the property or subsequent owners.  Sounds like BS to me, but I suggest you reach out to a local RE attorney and have them read the agreement and send the PM a letter.  Best of luck.  

Originally posted by @Steve Maginnis :

I'm no attorney, and certainly do not know the laws in states other than North Carolina, but I imagine your management agreement is between the owner of the property and the management company. The lease is between the owner (represented by the management company) and the tenant.  The owner decides to sell the property, so the lease would remain in force.  However, once the owner sells the property, the management agreement is nullified for the new owner.  I suppose I could see some "creative" agreement terms that binds the management agreement to the owner, entitling them to pay early termination fees, but it should not bind to the property or subsequent owners.  Sounds like BS to me, but I suggest you reach out to a local RE attorney and have them read the agreement and send the PM a letter.  Best of luck.  

I've never been in this situation before. Honestly, I believe this management company is huge so they may not fight me over it since this is not a large property anyway and wouldn't be a major loss to them. I think the best initial approach would be to casually let the PM company know that I'm not going to need their services at this time and that I'll keep them in mind for future needs. They may just shrug and say ok to avoid burning bridges. If they try to dig in, I'll follow your recommendation and consult a local RE attorney.

I think there may have been some misinterpretation of the clause? The PM signed that agreement with the former owner and he did not make said agreement with you. The PM may be entitled to be paid his management fees from the Seller after the sale but that contract means nothing to you the