FROM THE LEGAL HOTLINE: By MAR Legal Counsel Linda Gifford
Portland Maine Real Estate
Kick out Clause. Members have seemed surprised recently to discover that once their buyer puts their home under contract, in a situation where the buyer has a "subject to sale" addendum and then a kick out clause, that the kick out clause is still in full force and effect. The fact that their first home goes under contract does not negate the kick out clause. And if the seller then gets another offer which is acceptable to them, the seller can exercise the kick out clause, and unless the buyer can get a letter from a bank stating that they can purchase without the sale of their prior property actually closing, they can still lose the new property. The only remedy is for the buyer to negotiate an addendum to the contract once they put their property under contract which would void the kick out clause, if the seller is willing to take the risk that the other property will actually close.
