“CONTINUED MARKETING” AND THE “72-HOUR CLAUSE”

1. The acceptance by a seller of an offer that is subject to fulfilment of a suspensive condition, i.e. among others, the acquisition of a mortgage bond and/or the sale of the purchaser’s existing property, means that the property is effectively taken off the market in anticipation of fulfilment by the purchaser of such condition/s..

2. This may happen during a time that the demand for properties is high and taking the property off the market entirely, may later be regretted if a suspensive condition is not fulfilled and a golden opportunity to dispose of the property to a third party may have been missed altogether.

3. Failure on the part of the purchaser to fulfil any one or more of the suspensive condition/s on or before the cut-off date will simply render the agreement of sale of no further force or effect. It will also be incapable of being revived unless extended by agreement between the parties prior to the stipulated date of fulfilment.

4. That is why, in the pre-printed “Offer to Purchase”-forms of most estate agencies and many Deeds of Sale, provision is made for the “Continued Marketing” of the seller’s property in anticipation of fulfilment by the purchaser of the suspensive condition/s. Should a second, better offer be received following such continued marketing, which the seller intends accepting, the latter will be entitled to give written notice to the purchaser who had made the first offer, to either fulfil the suspensive condition/s or to waive it/them within 72 hours (or 3 days).

5. In the event of:-

5.1 fulfilment, or a waiver, of the suspensive condition/s within say 3 days, the first offer to purchase will become unconditional and the transaction will be proceeded with;

5.2 failure on the part of the first purchaser to either fulfil or waive the suspensive condition/s within 3 days, the seller may consider the first offer to purchase as obsolete and of no further force or effect. The seller is then free to accept the second offer which would normally be an unconditional offer but not necessarily so. The transfer process can then immediately be commenced with.

Specify a domicilium address that will expedite effective delivery

(i) The 72-hour (or 3-day) notice needs to be capable of swift delivery. By using e-mail addresses as their chosen domicilium addresses, parties to a Deed of Sale ensure the swift and effective delivery of important notices.

(ii) In such an event delivery will be effected within a matter of hours if not instantaneously. Otherwise, in the event of having to forward a 72-hour notice to a residential address by registered mail and allowing say 4 days for delivery, the 72 hours (3 days) procedure becomes a prolonged exercise. There is also a chance that the addressee might never receive a notice which in time may give rise to arguments and may even entail costly and time-consuming litigation.

The above is a simplified explanation of the effect of a 72-hour clause, the wording of which is extremely important due to the technical nature of its implementation and the correct execution thereof. It is therefore advisable that parties obtain appropriate legal advice before making or accepting an offer containing a “continued marketing” and/or “72-hour” clause.