Purchase and Sale: Buyer’s Offer Unexpectedly Rejected

Question: If an associate or broker representing a seller says over the phone that a seller accepts an offer, but the seller changes their mind before signing, is there a contract?

Answer: Not necessarily.

According to Florida Realtors’ Associate General Counsel, Joel Maxson “As a matter of general contract law, any party who receives an offer can accept, reject, counter or simply ignore the offer. Since this is a purchase and sale contract for real property, the statute of frauds applies, which provides that a contract must be in writing and contain the other side’s signature before it becomes enforceable.

While oral contracts can exist for other types of transactions, that’s not the case for the purchase of real property. Since this written offer only contains the buyer’s signature, there is no enforceable contract against the seller. There was an offer, followed …. later by a rejection. Additionally, from the seller’s perspective, these facts don’t show evidence of fraud, misrepresentation or other actionable seller behavior.”

Question: Is there liability against the listing associate or listing brokerage firm?

Answer: “The listing associate’s main duty in this situation is to present “all offers and counteroffers in a timely manner, unless a party has previously directed the licensee otherwise in writing.” This duty applies to both transaction broker relationships and single agent relationships described in Florida Statutes Section 475.278. [If the listing associate presented both the buyer’s offer and the mystery buyer’s offer in a timely manner then] the listing associate complied with this rule.

There can be liability if the buyer can prove there was some form of fraud or misrepresentation by the listing associate and if so, it’s possible this liability carries to the brokerage firm. These are general principles of law that can be used in civil litigation but are also a basis for a Florida Real Estate Commission (FREC) or code of ethics complaint. For reference, license law Section 475.25(1)(b) prohibits “fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or device, culpable negligence, or breach of trust in any business transaction in this state or any other state, nation, or territory.””

Disclaimer: The information provided herein does not, and is not intended to constitute legal advice. All content on this website is for general informational purposes only. Consult your attorney or contact Florida Realtors legal department if you are a licensed Florida Realtor.

Source: Partial reproduction of “Buyer’s Offer Was Unexpectedly Rejected,” Joel Maxson, Florida Realtors (Jan. 30, 2024) accessible here.