Personal Property: What You Want vs. What You Get
ORLANDO, Fla. – What personal property items are your buyers actually getting in a deal? It’s important that their expectations match what they’re entitled to under the contract.
Hopefully the sales contract clearly states the real property being conveyed in a transaction, but make sure you’re clear on what personal property is being transferred. Many calls to Florida Realtors Legal Hotline deal with conflicts over what a seller ends up taking vs. what a buyer was expecting to remain, and those disputes can blow up the entire transaction. This article attempts to walk you through this section of the contract to avoid that happening.
Usually the Hotline call starts along these lines:
- “Well, it said in the MLS that X was in the property!”
- “But the contract said that Y was included!”
- “Well it wasn’t supposed to be part of the deal!”
What exactly am I talking about here? Specifically, I’m referring to any personal property being conveyed during a real property transaction. Using the Florida Realtors/Florida Bar “ASIS” Residential Contract for Sale and Purchase (“FR/Bar ASIS”), this information is covered in paragraph 1(d). Let’s take a look at the language in that paragraph:
“Personal Property: Unless excluded in Paragraph 1(e) or by other terms of this Contract, the following items which are owned by Seller and existing on the Property as of the date of the initial offer are included in the purchase: range(s)/oven(s), refrigerator(s), dishwasher(s), disposal, ceiling fan(s), intercom, light fixture(s), drapery rods and draperies, blinds, window treatments, smoke detector(s), garage door opener(s), security gate and other access devices, and storm shutters/panels (“Personal Property”).
Other Personal Property items included in this purchase are: _____(Long blank line here)____.
Personal Property is included in the Purchase Price, has no contributory value, and shall be left for the Buyer.”
Now let’s look at some specific scenarios encountered on the Legal Hotline with regards to above mentioned questions.
“It was in the MLS!”
It is really, really important to recognize this: Just because something is stated in the MLS does not mean that is what a buyer is going to get. The sales contract governs the parties and what is being conveyed, not the MLS.
I’ll say it again: The contract controls the parties, not the MLS.
Here is an example: The MLS states there is a washer/dryer. The parties execute a FR/Bar ASIS contract, which as you can see from the pre-printed language above does not include a washer/dryer with the transaction. The buyer does not add the washer/dryer on the line in paragraph 1(d) that lists possible additional Personal Property to be conveyed and is then very upset to discover during the walk-through that the seller has removed them.
Trouble ensues. The buyer claims they will not close unless the seller returns the washer/dryer to the property. The seller refuses to do so and contends it wasn’t part of the sale. Each side refuses to budge and the entire deal blows up.
Bottom line: If you’re representing a buyer, make sure you have a conversation when putting together the offer as to what items the buyer wants conveyed. Did they want the washer/dryer in the house? If so, make sure you include that on the line in paragraph 1(d). If the buyer doesn’t want them, great. No need to do anything. But you need to discuss what things the buyer likes and whether or not they want those items as part of the deal. Then you must add them to the contract if they aren’t in the pre-printed language; if not, they simply don’t convey.
“But the contract said it was included!”
I know I’ve said this before, so don’t hate the messenger, but the words in contracts matter. What do I mean by this? Here are a few examples: The buyer does a walk-through and realizes storm shutters are nowhere to be found, or the buyer realizes right before closing that a propane tank is gone. Let’s look at each of these examples with respect to the language in paragraph 1(d).
First, storm shutters: Per paragraph 1(d), storm shutters are to convey, right? That is correct, but in order for storm shutters to convey, they have to be “owned by the Seller and existing on the Property as of the date of the initial offer.” If the seller never owned storm shutters and they weren’t existing on the property as of the date of the offer, this language does not obligate the seller to go out and get them just to convey them to the buyer.
What is the takeaway here? Pay attention to the pre-printed language. Just because something is listed in paragraph 1(d), doesn’t mean the buyer is getting it unless the seller actually owns it and it is existing on the property as of the initial offer. Make note of items on the property when touring it with your buyer(s).
There is the same potential with a missing above-ground propane tank: If the seller rented this tank and didn’t own it, it isn’t included in the transaction. However, with things like above-ground gas tanks, it is a good idea for the buyer to ask the seller about the ownership of the tank and any agreement terms with the company providing it. Some may allow the tank to remain and just change names on the account. Some, however, remove tanks from properties that are being sold. Again, this is where asking questions when showing a property can help a buyer put his or her offer together the right way and avoid a potential conflict.
“Well, it wasn’t supposed to be part of the deal!!”
In this example, I’ll use a real-life call to the Legal Hotline, which is a hybrid of the above two questions. The MLS specifically stated that the chandelier in the dining room wasn’t staying with the property. Yet, the seller failed to put in paragraph 1(e) of the sales contract that the chandelier was not conveying with the home. The buyer pointed to the language that said light fixtures were to stay with the home and the seller refused to put it back, not willing to give up a family heirloom.
If a situation like this does occur, the best hope to is help the parties come to some sort of compromise so the entire deal isn’t lost over a light fixture. In this instance, the agents should work together: Will the seller replace the fixture with a similar one? Or provide a credit for the buyer to replace it? Working together with your fellow Realtors gets you a lot further than casting blame on each side.
Meredith Caruso is Associate General Counsel for Florida Realtors
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