Discussion #2
When a person decides to sell their property, they hire a real estate agent to help facilitate in
the marketing and selling transaction. A real estate agent is usually the one whom the buyer and
seller would contact in the first stages of the transaction, when both parties are trying to
negotiate a price which they can mutually agree upon. The real estate agent is the middle man
in this entire first procedure. An agent is not allowed to settle on any particular price without
the seller being aware of it, unless the seller has given them the agency to do so. If the agent
has signed on an offer without the knowledge or consent of the seller then they are in breach of
warranty of authority, which means the agent entered into a contract with a third party on
behalf of the principle, whom in this case would be the seller, and implied that as the agent for
the principle, they had the authority to sign on an offer.
In the case of Kerry, there is no mention of her giving agency to her real estate agent Patrick to
sign any offer on her behalf. Kerry is not liable to sell her property to Paul and Rick who have
made her an offer, which has been accepted by Patrick. Kerry has a few options that she can
consider moving forward.
Option# 1- Kerry can decide to sell her property at the price Patrick has signed off on. This way,
at least her property will be sold, even though it’s at the lower end of her asking price.
Option# 2- Kerry can decide not to accept the minimum price, and send a counter offer to Paul
and Rick. Paul and Rick being the third party can sue Patrick for breach of warranty of authority
in that case, because they thought the offer was final, and they were going to be purchasing this
property.
Real estate is a tough market, more so if you’re selling a commercial property. My advice to
Kerry would be that if her budget allows her, than accept the offer and sell, because there are
no guarantees that she will get another offer anytime soon, or at all. She also has the option of
sending a counter offer to Paul and Rick, and if they refuse, Kerry can always look for other
buyers for her property. My personal advice would be to negotiate again with Rick and Paul, and
if they absolutely refuse any other offer, than at least sell it to them at their original offer for
$250,000 since she already planned to sell in this price range. I would also advice Kerry to report
to inthe agency which Patrick works for, and leave her review of how Patrick’s’ actions have
negatively impacted Kerry.
