Reference no: EM133569410

Case Study: Layla Lister's seller Sam was out on vacation when an offer from Bill the buyer's agent was sent via email. The offer was FULL PRICE with very few contingencies. Sam was hiking in northern Canada and was unavailable. Before leaving for vacation, he had asked Layla to place his listing on temporary Hold on the MLS, since it would be practically impossible for anyone to reach him in case an offer came in. Layla completely forgot to change the status from "Active" to "Hold" and, sure enough, Bill's offer came in. For two days, Layla desperately tried to reach Sam. Just before the offer was about to expire, Sam called Layla! She excitedly answered, and said, "Sam! I'm so glad you called. You have a FULL PRICE OFFER with few contingencies!" Sam was so happy to hear this, he said, "Go ahead and sign it on my behalf. You know what my signature looks like. I'll be back in a week, get everything rolling, and we can finish the paperwork when I return!" Layla was not comfortable signing Sam's signature, so instead, she wrote just his initials and wrote underneath: "per telephone conversation." Layla opened escrow and Bill and his buyer came a few days later to conduct their inspections.

Questions:

1. Is there an enforceable contract between Layla's seller and Bill's buyer? Why or why not?

2. Did the agents fulfill their duties to their clients? What legal and/or ethical issues, if any will these agents potentially face?

3. What would be a preferable way of getting the signature of your seller or buyer?

4. Assume that during the time Bill's buyer was conducting inspections, Layla showed the property to her own buyer and that the buyer wrote an offer -- this one with NO contingencies and $10,000 ABOVE asking price. When Sam arrived from vacation, he signed the higher offer from Layla's buyer, telling Layla, "Cancel that contract with the first buyer since I never signed it." What would YOU do if you were Layla?