There is an old expression in the law that “An oral contract isn’t worth the paper that it’s written on.” This is especially true for contracts that involve real estate. A contract to buy or sell real estate MUST be in writing in order to be enforced by a court. A lease lasting more than one year must also be in writing to be enforced.
As with any legal scenario, in matters of real estate law, it is critical to verify all associated parties, and really know who you are dealing with. Consider these true cases: A man once signed a purchase agreement to buy land and gave the “seller” a large deposit. He later learned that the seller had deeded away the property a year before to keep it from being seized by creditors. Another person added his fiancee’s name to the deed to his house only to find out, after the marriage was called off, that she hadn’t paid her income taxes and the I.R.S. had placed a lien on “her” (his!) home.
If you decide to draft your own agreement to buy or sell real estate, you need to think of everything that could possibly go wrong and create an action plan to resolve the pitfalls in any given situation. Each possibility needs to have a deadline and method of resolving that particular problem. If a difficult situation arises, you don’t want to find out in the middle of it that the contract you have drafted is completely silent about what to do in that particular situation. If you are the seller of real estate, be sure to outline clear deadlines so that if a buyer cannot live up to them, you can find another buyer.
Matters concerning real estate can be complex and involve important details you may not have considered. The best solution is to have a professional assist you in the drafting of any legal documents or contracts. Contact us for a free consultation.
Do you own your own business? Getting ready to start a new business? Wading through business legal documentation can be a daunting task, to say nothing of writing your own. If you’ve ever downloaded or purchased a CD of legal forms with the intent of drafting your own contract, please proceed cautiously. Many of these documents are not drafted with Michigan law in mind.
If you draft a legal document, and any part of that document is ambiguous, a court of law is required to read ambiguity in favor of the other party. A written document also takes priority over any oral agreements that were made before the contract was signed. You must be absolutely certain that your final document contains everything that was discussed, such as warranties, payments terms, etc., or they will not be considered part of the contract.
Finally, certain provisions must be in writing and signed in order to be enforced. A court cannot award you the late fees on overdue payments, or your attorney fees in the event of a lawsuit, unless the other party has agreed in writing.
Regardless of the size of your business, when it comes to developing legal documentation, it is best to seek the help of a professional. Legal Strategies has experts in the area of corporate law who can help ensure that your legal contracts are complete and binding. Please request a free, no-obligation consultation.