Another Part Time Agent Story

Here is another story giving weight to the idea that there should be no part-time agents.

First, a little background:

I represented the Seller in a transaction that closed two weeks ago.  The Lender in the transaction required some costly repairs to be completed before they would allow financing.  The Buyer's agent thought the transaction was dead, but I negotiated with the Lender to allow the Seller to put some of the proceeds of the sale into escrow for repairs at the end of the transaction.   In the process, I persuaded the Buyer to increase the amount he was paying for the property to cover a portion of the repair costs as estimated.  The licensed contractor that provided the $10,000 repair estimate would do the work within 10 days of the close of escrow.  150% of the estimate ($15,000) was placed in escrow to allow for any cost overruns from the estimate.  Anything that was left in the escrow account after the job was completed was to be refunded to the Seller.

I checked in with the contractor about a week after escrow closed to make sure everything was OK.  The contractor said that there had been some delay because of the unusual winds, but they would finish the job with time to spare, and they did.  The contractor, being from a very reputable company and being honest, only turned in a bill for the work that he did.  The contractor billed $8000 - $2000 less than the estimate.

The Buyer learned of the difference in the estimate and the actual  cost of the work, and now wants his part-time agent to recover some of the funds for him.  The Buyer now feels that he "over-paid" for the property because the price increase that he agreed to covered nearly 100% of the repairs, and he wants a "refund".

Last night, the part-time agent representing the Buyer of the property called.  She complained that the lender was no longer returning her calls after she had used them exclusively for years.  She thought it was unfair that her client didn't get back some of the money for the work that the contractor didn't do.  Also, she revealed that she authorized the contractor to leave out the labor that would be affected by the weather, in order to allow the contractor to finish on time.  She did everything but ask straight-out for a Buyer refund.

Fat chance!  The other agent said she had  never read the escrow repair distribution agreement.  There was no provision in the escrow repair agreement to split any amount of the funds due to the Seller after the work was completed if the cost came in under estimate.  The Buyer was perfectly willing to let the Seller assume all the cost if there was an overrun.

The Buyer got exactly what he wanted - the repairs were completed to everyone's satisfaction with a 10 year guarantee by the contractor.

What the Buyer's par-time agent is doing here is wrong on so many levels:

1)  She should have extended the escrow agreement instead of allowing the contractor to do something other than his estimated work
2)  Now that everything is done, she should be telling her client that a deal is a deal, and this is what he agreed to.
3)  She should not be whining to the lender or the other agent about how unfair the world is
4)  She shouldn't be representing anyone if she doesn't take the time to read the agreements that her client is signing.
5)  She should have obtained counsel from other more experienced agents before taking on a transaction where she had "never done anything like this before".

She should not be in business!


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