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Drafting Your Own Legal Documents--Perhaps You have a fool for a client!!!

By
Services for Real Estate Pros with Topkins & Bevans-etopkins@topbev.com

There are many things many of you do better than I. I know you can bake a pie, or tie a fly, on manage a plane in the sky, better than I. I question, however, whether you can craft a legal document better than I, or any of my  attorney colleagues across this great nation of ours. Legal drafting is an acquired skill. It is born from countless hours of repetition, and observing, and inculcating. I see something in someone else's document, I make determination that the clause,or even phrase, is apt and I use it for future iterations. Because of my background, and educatiion, and experience, placing a new element in an already well-thought out document is appropriate. This is my craft; this type of ability to synthesize and create is what gives me the "ultimate value proposition" which all of us in this profession, who care, are searching for.

Having said everything I have said above, I continue to wonder why so many of you, who are non-attorneys, continue to put language in you Offers and Purchase and Sale Agreements, the legal ramifications of which you really cannot be certain. Are you exposing yourself to liability which is not part of the job description? Are you venturing into waters that are unknown and dangerous?

As I have indicated many times in the fact, I believe in quoting "fixed fees" for my purchase and sale work. I try to make these fees reasonable; I abide by my quoted rate unless the client comes to me and requests that I charge more. That happens once in a while when a deal goes way, way off the track. In any event, drafting ALL documents is part of my fixed fee. The reason I can be so inclusive is that I can draft a document in much less time than it takes you to bake a pie, or tie a fly. This is my craft: I know how to do this. Use me,or my colleagues. We are there to help, and we can help get the deal to the closing table, where we are want to meet, as soon as we can.

Fernando Herboso - Associate Broker MD, & VA
Maxus Realty Group of Samson Properties - Clarksburg, MD
301-246-0001 Serving Maryland, DC and Northern VA

A blank general addendum form could the most dangerous thing a Realtor may face. .

Mar 17, 2011 11:54 PM
Robert Courtney
Lihue, HI
Century 21 All Islands, RA, CDPE, MCRE, CIAS

Elliot - always recommend a client share docs with an attorney.  I have been mentored to only put in writing what has been said or is a contingency needing to be introduced as a consideration of one of the parties involved in a transaction.  Your expertise, or one of your fellow colleagues is absolutely critical to a smooth closing

Mar 18, 2011 12:44 AM
Bob Zorechak - ABR, GRI, e-PRO
Keller Williams Realty Metropolitan - Morristown, NJ
Sells Homes in Morris/Somerset/Hunterdon Cos., NJ

I always follow the KISS approach myself.

Mar 18, 2011 01:24 AM
Dennis Duvernay Broker/Owner
Hillview Realty - Northbridge, MA

Do you want to help stay away from a lawsuit Mr Seller, Mr Buyer? Please use an attorney to go over every detail. Out here south of Worcester any attorney I have used always quotes a fixed price.

Mar 18, 2011 01:25 AM
Elliott S. Topkins
Topkins & Bevans-etopkins@topbev.com - Boston, MA
Massachusetts Real Estate and Title Atty

Dennis--If you need any help in the Boston area, I would be gald to assist, again always with a fixed price.

Mar 18, 2011 01:33 AM
J. Philip Faranda
Howard Hanna Rand Realty - Yorktown Heights, NY
Associate Broker / Office Manager

New York is an attorney state, and in my area the purchase and sale contracts are drafted and negotiated by the attorneys for buyer and seller. No changes can be made by agents. 

Listing agreements are boiler plate documents with fill in the blank for dates and numbers. Not much damage an agent can do there (much as many try). 

 

 

Mar 18, 2011 01:35 AM
Dennis Duvernay Broker/Owner
Hillview Realty - Northbridge, MA

Will do Elliott....Thank you

Mar 18, 2011 01:39 AM
Chris Olsen
Olsen Ziegler Realty - Cleveland, OH
Broker Owner Cleveland Ohio Real Estate

Hi Elliott -- Luckily, this concept was drilled into my head from Day 1.  Well said.

Mar 18, 2011 01:57 AM
Michael Setunsky
Woodbridge, VA
Your Commercial Real Estate Link to Northern VA

Elliott, I seen this many times over the years where something is written subject to legal interpretation. Thanks for the reminder.

Mar 18, 2011 02:02 AM
Tni LeBlanc, RealtorĀ®, J.D.
Mint Properties, Lic. #01871795 - Santa Maria, CA
Tenacious Tni (805) 878-9879

Hi Elliott -

Great advice.  As an attorney and real estate broker, I especially appreciate reading it.  

Great blog! 

Tni

Mar 18, 2011 02:24 AM
Irene Kennedy RealtorĀ® in Northwestern NJ
Weichert - Lopatcong, NJ

Elliott,

In my area of NJ, it is typical for each side to have an attorney.  I cannot tell you how glad I am about this and how much I appreciate the fine lawyers who are part of the team.  No way do I want to go it alone - or let my clients do so either!

Mar 18, 2011 02:26 AM
Randy Elgin
Option One Real Estate - San Antonio, TX
Sells Affordable Homes for sale in the San Antonio

My office has partnered with a real estate attorney and it is the best thing they ever did. Being able to ask questions to someone we can get straight forward answers from is terrific.

Mar 18, 2011 03:38 AM
Colleen Crowley
Keller Williams Realty - Shrewsbury, MA

Many agents in my area will prepare the Purchase & Sale Agreement for their clients without the involvement of an attorney.  As I am not an attorney, I absolutely refuse to do that.  They think it's odd as "it's a straightforward document," as they say to me.  I do not want the liability involved with preparing a legal document since that is not my area of expertise.  I'll stick to selling houses and working with valued attorney partners for them to do the legal work.

Mar 18, 2011 03:50 AM
Evelyn Santiago, Managing Broker Heart Realty Group, Inc.
Heart Realty Group, Inc.. - Oswego, IL
Passionate About Real Estate & Our Clients!

We fill in the blanks on our standard contract and disclosures and anything else goes to the attorney for approval.  I have enough to do without assuming someone else's work.  Unfortunately, there are plenty of agents that feel more creative and may end up out of the profession with their creativeness.

Mar 18, 2011 04:49 AM
Melina Tomson
Tomson Burnham, llc Licensed in the State of Oregon - Salem, OR
Principal Broker/Owner, M.S.

We have a 10 page purchase and sale agreement written by local attorneys and about 20 different addenda for other scenarios.  That covers 95% of real estate transactions.  I'm like Lenn, if I need a different clause, I write it and send it to my attorney to "attorney-i-fy" it and insert it into the addendum.  I have seen many rogue clauses on contracts that leave me shaking my head. In fact, I have to write a counter offer now in order to remove a poorly written half sentence from a contract inserted by an agent. 

Mar 18, 2011 05:07 AM
Brenda Noffert
Realty world Alliance - Wichita, KS

Elliot,

You stole my thunder!  I was teaching a class yesterday to a group of local agents about short sales and told them that anything they put in the "additional conditions" area that was not approved by their Broker (which would have been approved by an attorney) was PRACTICING LAW WITHOUT A LICENSE and a very serious offense.  I strongly advised them not to do it and to contact their Broker IMMEDIATELY after leaving the class to get "preprinted" clauses.

At the end of the class, we had annonymous question time (people wrote questions on pieces of paper without their name); 3 people, in a class of only 70ish, asked the same question:

"That "practicing law without a license" thing is ONLY on short sales, right?  We can write whatever we want on regular contracts, can't we?

After I ran screaming, I was going to post about it today! 

Thanks for the post!

Mar 18, 2011 06:06 AM
Glenn Roberts
Retired - Seattle, WA

I almost always know what I want to happen for a client, and what the client wants, but I would no more write (anymore) it in a contract than I would try to outrun a train.  

Mar 18, 2011 06:52 AM
Chris and Berna Sloan
Group 1 Real Estate - Tooele, UT
Tooele UT

Whether we are capable or not, we shouldn't be doing it! As Lenn said, outside our scope. We are very lucky in Utah, as we have a State Approved (through the AG's office) set of forms. Even the dreaded blank addendum is usually filled with something from our list of "Standard Supplimentary Clauses". That said, we will always have agents thinking they are smarter than everybody else...

Mar 18, 2011 07:58 AM
Torgie Madison
Quicksilver Real Estate Solutions, LLC - Portland, OR
Websites and Contact Management

Most of the horror stories on AR are about clients trying to weasel out of expenses by not using an agent or back-stabbing their current one. The moral of the story is always that hiring an expert will save you in the long run! The same is true here. Trying to side step a fee by writing legal documents yourself will always cost you more down the road.

Mar 18, 2011 08:04 AM
Anonymous
Dan Statlander

Well said. Thanks for the advice.

Dan Statlander
http://www.statelandbrown.com
(Real estate experts in Boca Raton Florida)

 

Mar 19, 2011 06:42 PM
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