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Professional Standards Manual

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10. Sale Of A Business

(f) Form of Contract

The standard residential Contract of Purchase and Sale is to be used for residential sales only, not for sales of businesses. Licensees should obtain professional advice from lawyers and accountants regarding the form of a contract. Suitable forms may be available for commercial transactions from board/association offices.

The standard residential Contract of Purchase and Sale addressed the matter of subjective clauses by including a provision that the seller’s acceptance was irrevocable and providing that the contract was signed under seal. Because the standard residential Contract will not be used for a commercial transaction, licensees should consider whether the subject clauses used in the contract are overly subjective. Licensees should review the section regarding ‘‘ Contracts under Seal’’.

It is recommended that all offers be written subject to the approval of the seller’s lawyer and the buyer’s lawyer and accountant within a specific time limit.

Approval by Seller’s/Buyer’s Lawyer Clause

Subject to (select either Seller’s or Buyer’s) lawyer approving the terms and conditions of the contract on or before (date) .

This condition is for the sole benefit of the Seller/Buyer.

Approval by Seller’s/Buyer’s Accountant Clause

Subject to the Buyer’s accountant approving the financial statements on or before (date).

This condition is for the sole benefit of the Buyer.