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As a result, if the receiving computer is using a different e-mail service and/or the Read Receipt option is not enabled, an e-mail sent to the receiving computer can be opened without a Read Receipt notice being sent back to the computer from which the notice was sent. As a result, REALTORS wanting absolute confirmation of the delivery of a notice should continue to send notices by facsimile.


 


(13) ELECTRONIC SIGNATURES NOW SPECIFICALLY ALLOWED
A new section on electronic signatures was added to the 2013 GAR Contract. Specifically, the new Contract now provides that an electronic or facsimile signature shall be deemed to be the same as an original signature. However, the GAR Contract then goes on to provide that the parties agree to re-execute a conformed copy of the contract with original signatures if requested to do so by the other party, or the buyer’s mortgage lender. While electronic signatures are being increasingly used by buyers and sellers, many mortgage lenders continue to refuse to accept them. Therefore, while the 2013 GAR Contract allows for the use of electronic signatures, the requirement that the parties sign a conformed or “clean” Contract with original signatures, if so requested, reflects the practical reality that lenders may require that such a contract be signed.


 


(14) WHAT SURVIVES CLOSING EXPANDED
The survival section of the 2013 GAR Contract was expanded to include “all representations of Seller regarding the Property”. This change was made to ensure that a buyer could assert a claim against a seller if a seller made a misrepresentation about the property in either a special stipulation to the Contract or in the Seller’s Property Disclosure Statement. Of course, just because the buyer has a right to assert a claim against the seller does not necessarily mean that the buyer will prevail in a case involving the claim.


 


(15) DISCLAIMER SECTION REVISED
The Disclaimer section of the 2013 GAR Contract was significantly shortened. The focus of the disclaimer section was also changed to more clearly state that the real estate brokers in the transaction and their affiliated licensees have no duty to advise buyers or sellers on matters that could have been revealed had another professional with real estate related expertise been allowed to do his or her job. So, for example, brokers and their affiliated licensees are not required to advise buyers on matters that would have been revealed had a professional home inspector conducted an inspection, a surveyor prepared survey, or an appraiser performed an appraisal.


 


(16) NOTICE SECTION REVISED TO PERMIT NOTICE TO THE BROKER’S EMPLOYEES


Under the GAR Contract, notice to the Broker has always been notice to Broker’s clients (except in transactions in which the Broker is practicing designated agency). But, what if notice is hand delivered to the receptionist in the Broker’s office? Does this constitute notice to the Broker’s client? The answer in the 2013 GAR Contract is yes. Additional language was added to the 2013 GAR Contract providing that notice to the “Broker’s employees” or the affiliated licensee of Broker representing a party in the transaction is notice to that party.


 


(17) TAX PRORATIONS SECTION REVISED
The paragraph on tax prorations was revised in the two respects. First, the 2013 GAR Contract now provides that any pending tax appeal is deemed assigned to the Buyer at closing. Tax appeals are increasingly common in an era of volatile home prices and the GAR Forms Committee decided that this issue should be addressed in some way in the GAR Contract. The thinking of the Committee in assigning the tax appeal to the buyer at closing is that the buyer should have the greatest interest in ensuring that any pending tax appeal is pursued.


In addition, the section on the proration of property taxes was revised to provide that in the event of tax savings resulting from a successful tax appeal, any third party costs to handle the tax appeal can be deducted from the savings before the buyer and seller are required to reprorate with one another. So, for example, let’s say that a tax appeal is successfully decided after closing resulting in savings of $5,000. If the buyer and seller each owned the property for half a year, they would each normally be entitled to half of the refund. However, let’s say that the buyer paid an outside tax consultant $2,000 to handle the tax appeal. Under the 2013 GAR Contract, this fee can be deducted from the tax savings with the $3,000 net savings then being divided between parties.


 


SUMMARY
The GAR Forms Committee is excited about the 2013 GAR Contract. Their hope is that a shorter, easier to fill out contract will be well received by the REALTOR community and that the many other changes made to the 2013 GAR Contract will help protect REALTORS and avoid disputes in real estate transactions.


 


SETH G. WEISSMAN IS GENERAL COUNSEL TO THE GEORGIA ASSOCIATION OF REALTORS. HE IS ALSO AN ADJUNCT PROFESSOR OF CITY PLANNING AT THE GEORGIA INSTITUTE OF TECHNOLOGY.


16 I GEORGIA REALTOR JANUARY I FEBRUARY 2013

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