Forms Update


 Jennifer Lindsley  |    October 18, 2021
Forms Update

The Real Estate Examining Board (REEB) and the Real Estate Contractual Forms Advisory Council have been hard at work improving the WB forms that you use in your transactions. As many of you know, the WB offers were polished up within the last couple of years, and after working through the residential, condominium and other offers, the council finally made it to the end of the offer to purchase ‚Äúline‚ÄĚ by updating the WB-16 Offer to Purchase ‚ÄĒ Business With Real Estate and the WB-17 Offer to Purchase ‚ÄĒ Business Without Real Estate. In addition, the council made some improvements to the WB-46 Multiple Counter-Proposal and the WB-25 Bill of Sale. All four forms have been approved by the REEB with an optional use date of September 1, 2021, and a mandatory use date of October 1, 2021.

WB-46 Multiple Counter-proposal

The new WB-46 Multiple Counter-Proposal looks nearly identical to the previous version, and it might be difficult to even spot the differences. That is because the form as designed was functioning in the exact way it was intended to function. This form allows a seller to engage in non-binding negotiations with multiple buyers at the same time, giving sellers a powerful tool, especially in a competitive market. The changes to this form were not to modify its function but rather to improve the layout and add some features that agents thought would enhance its usefulness.

Lines 1-10 of the WB-25 Bill of Sale
Upon the Effective Date below, Seller conveys to _______________________________(Buyer), for good and valuable consideration, all of Seller’s interest in the personal property identified in the Personal Property Schedule at lines 11-31 and in the attached Addenda per lines 32 (if any). 
Effective Date This Bill of Sale is only effective upon the successful closing of the Buyer‚Äôs offer to purchase, dated _________________, to purchase Seller‚Äôs property located at ____________________________ and payment additional consideration (if any) in the amount of $______________________(‚Äúnone‚ÄĚ if left blank) no later than closing.¬†
NOTE: A copy of the fully executed closing statement and a receipt, or other reasonable evidence of full payment of any required additional consideration, shall be confirmation of the Effective Date for this Bill of Sale.

So, what changed? 

  • The two signature spots for the sellers used to be two separate lines on the previous form. In the revised WB-46 Multiple Counter-Proposal, the signature spots for the sellers are on one line, with one spot being on the left side and one on the right.
  • The two signature spots for the buyers used to be two separate lines on the previous form. In the revised WB-46 Multiple Counter-Proposal, the signature spots for the buyers are on one line, with one spot being on the left side and one on the right.¬†
  • The Approval by Buyer section contains a line to indicate who presented the multiple counter-proposal to the buyer and when it was presented as well as a line for the buyer to reject or counter the multiple-counter proposal. In the previous version of the WB-46 Multiple Counter-Proposal, the buyer‚Äôs opportunity to reject or counter came first, followed by the information on presentation. In the new WB-46 Multiple Counter-Proposal, the information on presentation comes first, and the buyer‚Äôs opportunity to reject or counter follows. The same information is included, the locations in the form have simply switched.¬†
  • The revised WB-46 Multiple Counter-Proposal has a new addition to the Acceptance by Seller section; the seller now has an opportunity to reject or counter the buyer‚Äôs approved multiple counter-proposal. Line 50 of the revised WB-46 Multiple Counter-Proposal reads, ‚ÄúThis Multiple Counter-Proposal approved by Buyer is (rejected) (countered) STRIKE ONE (Seller‚Äôs Initials) __________.‚ÄĚ

WB-25 Bill of Sale

Like the WB-46 Multiple Counter-Proposal, the revised WB-25 Bill of Sale looks a lot like the previous version of the form because the WB-25 Bill of Sale was functioning exactly as intended and did not need extensive revisions. The revisions to the WB-25 Bill of Sale improved layout and functionality, but the purpose of the form remains the same: the seller uses a bill of sale to legally transfer ownership of personal property to the buyer. A seller uses a deed to transfer ownership of real property to a buyer and a bill of sale to transfer ownership of personal property to a buyer.

So, what changed?

  • A major change to the WB-25 Bill of Sale is that it now has an effective date tied to the successful closing of the transaction. In the previous version of the WB-25 Bill of Sale, the transfer of ownership was immediate upon the seller signing the WB-25 Bill of Sale and delivering it to the buyer. This occasionally led to some unintended consequences. Consider the following scenario: A buyer submits an offer that includes the seller‚Äôs washer and dryer. Along with the offer, the buyer drafted a WB-25 Bill of Sale on the previous version of the form that includes the washer and dryer. When the seller signed to accept the offer, the seller also signed the WB-25 Bill of Sale and delivers it to the buyer. The moment the seller signed the previous version of the WB-25 Bill of Sale and delivered it to the buyer, the seller immediately transferred legal ownership of the washer and dryer to the buyer even if the transaction ultimately does not close. To avoid this error of accidentally transferring ownership of personal property in a transaction that does not close, the updated version of the WB-25 Bill of Sale does not transfer ownership of the personal property until the transaction closes.
  • The seller‚Äôs representations regarding ownership and right to transfer the personal property is modified slightly in the updated version of the WB-25 Bill of Sale. The language that is crossed out of the following statement is omitted in the updated version of the WB-25 Bill of Sale. ‚ÄúSeller hereby warrants and represents that Seller owns said personal property free and clear of all liens and encumbrances, that Seller ("that Seller" removed) has good right to sell the same and Seller will warrant and defend the same against the lawful claims and demands of all persons, except: _______________________.
  • The following note is in both the previous and updated versions of the WB-25 Bill of Sale, but it is bolded in the updated version. ‚ÄúNote: The above warranty applies only to title. If there are any other warranties or representations as to other characteristics of the personal property a separate agreement must be drafted.‚ÄĚ
  • The previous version of the WB-25 Bill of Sale included four signature lines for individual sellers. The updated version of the WB-25 Bill of Sale includes two signature lines for individual sellers and a set of signature lines to accommodate a seller that is an entity such as a limited liability company or corporation.¬†

WB-16 Offer to Purchase ‚ÄĒ Business With Real Estate

WB-17 offer to Purchase ‚ÄĒ Business Without Real Estate

The business offers to purchase win the prize for being two of the longest forms and, some might say, the most complicated. With the recent revisions, the WB-16 Offer to Purchase ‚ÄĒ Business With Real Estate increased from 14 pages to 17 pages, and the WB-17 Offer to Purchase ‚ÄĒ Business Without Real Estate increased from 11 pages to 12 pages. Many of the revisions to the business offers incorporated the changes that were made to the other offers such as including default deadlines, improving the flow of the form and including the Foreign Investment in Real Property Tax Act (FIRPTA) provision. Other changes to the forms were more technical and relate to those transactions involving a business with or without real estate. Due to the technical nature of the improvements to the business offers, they will not be addressed here. For those who want to review all the changes to the business offers, a highlighted version of each of the business offers showing the changes is available on the WRA forms update resource webpage at www.wra.org/FormsUpdate.¬†

Jennifer Lindsley is Staff Attorney and Director of Training for the WRA.

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