"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
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
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