• FreeAdvice has a new Terms of Service and Privacy Policy, effective May 25, 2018.
    By continuing to use this site, you are consenting to our Terms of Service and use of cookies.

"Highest and Best Offer" bid solicitation - we WON, but week later LOSER bids again!

Accident - Bankruptcy - Criminal Law / DUI - Business - Consumer - Employment - Family - Immigration - Real Estate - Tax - Traffic - Wills   Please click a topic or scroll down for more.

Status
Not open for further replies.

ReedMikel

Junior Member
"Highest and Best Offer" bid solicitation - we WON, but week later LOSER bids again!

What is the name of your state (only U.S. law)? New Jersey

Hi All,
We were attempting to buy a condo in NJ and our agent was told by seller's agent that multiple parties were interested, and seller was conducting a "Highest and Best Offer" bid solicitation. We bid $10.5K over list price, and within a few days we were told we had "won" the bid. The standard NJ real estate contract was signed by both parties and we entered attorney review period on a Weds, when our attorney sent a letter of introduction (to seller's attorney), approving the contract with a few (standard) minor changes. We finally got a response from seller's attorney that Fri (3:15pm), approving the changes and providing an amended contract agreement. That same Fri, seller's son (handling most aspects for his elderly mom) sent an email to both attorneys and agents, stating his mother was "faxing a signed agreement momentarily". We, the buyers, were never copied on that email, so saw no reason to sign since it was late Fri afternoon and we figured no business occurred over the weekend. Fast forward to noon on Monday - our attorney emails us a copy of a fax from seller's attorney withdrawing the contract - no explanation. Our attorney calls seller's attorney and asks if there is another offer on the table. He denies knowing of any other contract. Our attorney then calls listing agent and learns that, contrary to what seller's attorney said, another (higher) offer was presented on Sunday and directed to seller's attorney (he lied)! And this "new" offer is from a couple that LOST in the "highest and best" bid solicitation a week earlier! A few hours later our attorney calls seller's attorney again - this time he admits he did get a new contract... Knowing that we really wanted this condo, our attorney advises we counter offer at $1k over this new bid (which is ANOTHER $10.5K over our WINNING bid) - and threatens seller's attorney that if they don't accept our 2nd offer, a complaint will be filed in Chancery Court. Seller agrees, and several months later we close. So we were coerced into spending that additional $10.5K to purchase this property!

Now here's our main complaint: seller solicited a "highEST and bEST offer" and selected our offer/bid. Isn't it a breech of contract to solicit and accept what they called a "highest and best offer", then turn around and cancel our deal, and accept a SECOND offer from a party that LOST a week earlier? The "highest and best offer" solicitation was not in writing, so we presume the English language prevails and a reasonable and ordinary person would assume that there is only ONE chance to bid when "highest and best offer" is asked for - AND ACCEPTED. We do realize that under NJ law, either party may cancel while transaction is in the attorney review period. So sleazy as it is, I guess they can technically cancel the deal for no reason. So I would not challenge that. Instead, I would focus on the fact that a verbal agreement/contract was made when they solicited AND ACCEPTED our bid as "highest and best". To then turn around and accept a bid from someone that already LOST seems to violate the verbal contract...

I believe there is a case against the seller, as well as listing agent/firm. The latter may have committed fraud. If so, we could file a NJ CFA (Consumer Fraud Act) case, where if we prevail we'd be entitled to treble damages, attorney fees and court costs...

Not sure just how relevant this is: but I strongly suspect seller did fax a signed contract agreement that Fri afternoon to their attorney. That should be easily discovered with a subpoena. Our attorney stated that she thought the moment seller signed the agreement (if she did) concluded the attorney review period, which would have precluded them from entertaining new offers.

Opinions?

TIA,
ReedMikel
 
Last edited:


HRZ

Senior Member
MY guess is that this is about 99.99% a selling game ...and until there is a written signed acceptance of offer in place all you have is a place in the race to keep bidding ..you played the sellers game ...you won the race by higher bids...nobody coerced you, you coerced yourself .

THe announcement of bid winner is not likely to be an acceptance of offer as I doubt this was conducted as a true auction

ANd I don't remember all the stuff about contracts, but I doubt an acceptance is binding upon execution but upon receipt unless one is applying the mailbox rule and I doubt this was done by mail.

ANd I'm told by counsel in NJ that the attorney review window is a pretty good window to accept even higher bids. An races have been known to include ghost riders ...
 

ReedMikel

Junior Member
I would argue that "highEST and bEST" is unique, in that it implies that , if accepted, a LOSING bidder would not get the opportunity to bid again. I'm speaking common sense, English language, interpretation. If they wanted an open bidding process with unlimited bidding opportunities, then don't call it "highest and best", as that is extremely misleading/unethical and likely fraudulent. But thanks for your feedback! Opinions vary widely so far in speaking with all sorts of folks: realtors, attorneys, lay people etc. All have agreed it's sleazy, unethical and some would argue (myself included) fraudulent.

I'm still gathering lots more info/research, but my inclination is to sue seller and agent in a NJ Special Civil case where I can represent myself, limited to a $15k recovery. And I'd opt for a 6 person jury trial ($100 option), as I truly believe reasonable people will agree this an absurd practice for sellers and their agents to conduct! At the least, it will be interesting :) And I'm starting an Internet-based PR war against the large real estate firm, as I want potential customers to realize just how sleazy the big "W" can be! Hopefully I didn't reveal their name :)
 

FlyingRon

Senior Member
Understand your bid is just an offer. Until you have a signed written contract, you have nothing. There's no requirement in most cases for the seller to accept the "highest" bid nor does anything prevent him from soliciting other offers (from you or anybody else). It's generally a good idea to put time constraints on offers to prevent a lot of this foolishness.
 

ReedMikel

Junior Member
It's more ashamed that so called "professionals" are sooo sleazy :(

I think some of you are missing my main argument: forget the real estate contract. I'm saying the seller entered into a verbal contract when they solicited a "highest and best offer" from us, ACCEPTED our offer, then essentially violated the "contract" by accepting a SECOND bid from a LOSING party. Sleazy - yes. Unethical - yes. Fraudulent - TBD in court.

Again, forget NJ's absurd laws that allow seller (or buyer) to cancel contract during attorney review period - I understand that nosense. Instead, focus on the other "contract", albeit a verbal one.
 

ReedMikel

Junior Member
If the PR simply states my experience and opinions? I'll be clear to state it's my OPINION. Let's face it folks, if somebody doesn't stand up to these types of highly unethical, and TBD fraudulent practices, then the sleaze just continues. "The squeaky wheel gets the oil" - and it will take a lot of squeaking :)


And that online PR war is an excellent way to get slapped with a defamation suit.
 

Zigner

Senior Member, Non-Attorney
Again, forget NJ's absurd laws that allow seller (or buyer) to cancel contract during attorney review period - I understand that nosense. Instead, focus on the other "contract", albeit a verbal one.
Real-estate contracts must be in writing, so there's really no need to focus on a non-existent "verbal contract" for real-estate.
 

FlyingRon

Senior Member
I think some of you are missing my main argument: forget the real estate contract. I'm saying the seller entered into a verbal contract when they solicited a "highest and best offer" from us, ACCEPTED our offer, then essentially violated the "contract" by accepting a SECOND bid from a LOSING party. Sleazy - yes. Unethical - yes. Fraudulent - TBD in court.
We are not missing anything. It is you who are ignorant of the law. There's no such thing as a verbal real estate contract. The statute of frauds requires such to be IN WRITING. Even if the statute of frauds didn't exist, you don't have the essentials of even a verbal contract.

Instead, focus on the other "contract", albeit a verbal one.
You don't have a contract, verbal or otherwise. And a verbal contract is meaningless here.
 

ReedMikel

Junior Member
Hmmm, but none of the parties involved will deny that a "highest and best offer" (their words, not mine) was indeed made. And I argue that they misrepresented this whole solicitation process, essentially committing fraud. Again, I am not focusing on the contract that was under attorney review - I am focusing instead on the "highest and best" solicitation process initiated by seller and their agent. It wasn't "higher and better", it was "highEST and bEST", which in my mind (as an ordinary and intelligent person) has only one meaning. No way in hell can the loser in this specific type of solicitation get another chance to bid a week later. That's an insanity that I will fight to no end to see get fixed in NJ! Yes - I'm emotionally charged about this matter - so sorry if I'm coming off too strong...


Real-estate contracts must be in writing, so there's really no need to focus on a non-existent "verbal contract" for real-estate.
 

Zigner

Senior Member, Non-Attorney
Hmmm, but none of the parties involved will deny that a "highest and best offer" (their words, not mine) was indeed made. And I argue that they misrepresented this whole solicitation process, essentially committing fraud. Again, I am not focusing on the contract that was under attorney review - I am focusing instead on the "highest and best" solicitation process initiated by seller and their agent. It wasn't "higher and better", it was "highEST and bEST", which in my mind (as an ordinary and intelligent person) has only one meaning. No way in hell can the loser in this specific type of solicitation get another chance to bid a week later. That's an insanity that I will fight to no end to see get fixed in NJ! Yes - I'm emotionally charged about this matter - so sorry if I'm coming off too strong...
I wish you the best of luck in your headstrong endeavor.
 

ReedMikel

Junior Member
Thanks for the comforting advice :( Why not try to be more creative and think "outside the box"? Sometimes you just have to approach things differently...

We are not missing anything. It is you who are ignorant of the law. There's no such thing as a verbal real estate contract. The statute of frauds requires such to be IN WRITING. Even if the statute of frauds didn't exist, you don't have the essentials of even a verbal contract.



You don't have a contract, verbal or otherwise. And a verbal contract is meaningless here.
 

Zigner

Senior Member, Non-Attorney
Thanks for the comforting advice :( Why not try to be more creative and think "outside the box"? Sometimes you just have to approach things differently...
...and sometimes you have to understand that it is what it is.
 

ReedMikel

Junior Member
Complacency - that's the problem with this aspect of NJ Real Estate. Affected parties either don't have the time, resources or energy to see that the "right" changes get made to a broken system. I have all 3 :)

...and sometimes you have to understand that it is what it is.
 
Status
Not open for further replies.

Find the Right Lawyer for Your Legal Issue!

Fast, Free, and Confidential
data-ad-format="auto">
Top