By Jennifer Lynn Walker

What happens when there us more than one promise to purchase at the same time?

I often get asked, what happens if I receive more than one promise to purchase at the same time? How does that work? The listing agent must respect the OACIQ real estate laws (our governing board) which states that after receiving a promise to purchase they must presenting it to their client as soon as possible. Where several offers are submitted, the agent/broker shall submit each proposal without regard to the chronological order of receipt, the identity of the real estate broker or agent, or the circumstances in which the proposal was taken.

Not letting any of the agents know about an offer would constitute an unfair practice and would give the informed collaborating agent an undue advantage over his colleague, which is forbidden regarding the Rules of professional ethics of the OACIQ.

If a second agent asks for information on the property, the listing agent shall advise him right away that there is an accepted offer or an offer in counter, however may not disclose any information on the promise to purchase that was submitted.

Protecting the clients

The listing agent must protect the interests of their client at all times, as well as having an obligation to act fairly towards all parties to the transaction. Therefore, the listing agent must explain to the Seller the alternatives he has when more than one Promise to purchase is presented. Which are:

1. Accept one Promise to purchase (if acceptable) and refuse the other. (Better to not refuse and close all doors)

2. Reserve on Promise to purchase and make a counter-proposal to the other at a higher price, taking into account the various deadlines; if the Counter-proposal is refused, he may accept the first. If the Buyer accepts the Counter-proposal, the Seller will refuse the one he had reserved.

If this is your situation as a Seller, it is important not to rush the conclusion of a transaction. The timeline can be used to your advantage. Maybe another offer might be coming in. If your agent encourages you to accept the first Promise to purchase without giving you opportunity to receive a second offer (knowing that one is coming inn), the broker and the agent’s civil liability could be at stake, not to mention that this would be a serious violation of the ethics.

To summarize: Yes the agent is bound by law to be fair and look after your best interest. There has been many cases that go in front of the Discipline Committee which agents have lost due to unfair practice by not following the above rules.