Legal Question in Real Estate Law in California

Re: Assignee (and/or) on Real Estate Contract

It is a curious addition to the signature line. In my opinion, it does not add anything to the agreement. Unless otherwise prohibited in agreement, most non-service contracts, including real estate purchase agreements, are assignable. If you�re using CAR forms for residential purchase, I do not believe there is any prohibition against buyer assignment of contract rights during escrow. Upon assignment, assignee would need to meet the obligations and contingencies of original buyer.

From a practical standpoint, I recommend that the listing agent inquire from buyer (or more precisely, the buyer�s agent) about the �and/or assignee� language. If he/she does not get a satisfactory explanation and you have concerns about buyer�s possible maneuvering during escrow, you can have an assignment consent provision inserted into your acceptance/counteroffer.

If you have any further questions, please not hesitate to contact my office for further assistance.

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Re: Assignee (and/or) on Real Estate Contract

This is not unusual. The offeror is expressing his intention to have another party actually take title.

One example of where this is done is when a developer is acquiring a parcel of land for development, and makes the offer in his own name, but if successful in buying the land, intends to take title in the name of a to-be-formed development entity, often an LLC, formed for that particular project.

The seller is protected against loss because, unless the purchase price is paid in full by someone (the offeror, the assignee, and/or their lenders), the deal won't close. The main circumstance in which one might want to make inquiries about the proposed assignee is if the deal is not all cash and the seller is being asked to carry paper. In that case, the credit of the party taking title may become an important consideration.

You'll need to have a written assignment prior to close of escrow; the escrow holder probably has a form or a way to include the assignment in its closing instructions.