Contracts that are vague and indefinite cannot be enforced by the courts. This rule is as old as the English law, but is often overlooked by the modern real estate broker. A substantial number of sales agreements in present practice are so vague that even the parties themselves cannot determine their intent.

We are referring to the present practice of altering the sales price numerous times during the process of offers and counter-offers. Most of the time the broker dutifully has the parties initial various changes, but the changes frequently become so involved that it is almost impossible to determine the final sales price. Some contracts have multiple changes in several areas, such as closing dates, the personal property involved, and others.

Not only does this practice lead to misunderstanding between the parties, it makes the closing difficult. Several states have promulgated rules prohibiting the changing of contract provisions, and requiring that they be rewritten. The addendum-counter offer form is the next best method of avoiding the problem. The best way is to rewrite the contract to conform to the wishes of the parties.

There is no hard and fast rule, but some cases indicate that three or more changes of the same fact situation could render the contract indefinite and void. A whole string of changes, with attending initials, illustrates sloppy draftsmanship and should be discouraged.

Sometimes the language itself is vague. A special clause produced on the spur of the moment may sound entirely different a day later. It is good practice to have another member of the office read any special clauses you have drafted. Other persons may interpret the language in an entirely different light than you expected,

If you must explain the special clause to the parties, it is your signal that the language could be improved It is relatively simply to re-type the contract before the signing, rather than later or spend attorneys' fee and court costs to prove your interpretation of the language.

CAVEAT: Avoid changing and initialing of contracts. Rewrite wherever possible. Ask an associate to read any new clauses for clarity of intent before you use them.

Reprinted from
Living Real Estate Law
Issue No. 576
September 1977

The Licensing Board advises you to caution sellers that changing an offer constitutes a rejection of the offer, and that once rejected, an offer is gone forever.