New C.A.R. Form Regarding Coronavirus

Here at Tyler Law we take the safety of our REALTORS® very seriously and are taking proactive steps to address the community’s ongoing concerns relating to the COVID-19 pandemic. We want to ensure that we are providing local businesses with up to date information to facilitate the continuity of their operations and smooth incorporation of recently enacted recommendations by C.A.R. We believe businesses should quickly adopt these recommendations that will ensure the real estate industry maximizes its productivity during this extraordinary times.  In Response to the growing concerns about COVID-19, commonly referred to as Coronavirus, Tyler Law is providing this guidance to help REALTORS® and REALTOR® Associations respond to the impact on the real estate industry.

Here at Tyler Law we take the safety of our REALTORS® very seriously and are taking proactive steps to address the community’s ongoing concerns relating to the COVID-19 pandemic. We want to ensure that we are providing local businesses with up to date information to facilitate the continuity of their operations and smooth incorporation of recently enacted recommendations by C.A.R. We believe businesses should quickly adopt these recommendations that will ensure the real estate industry maximizes its productivity during this extraordinary times.  In Response to the growing concerns about COVID-19, commonly referred to as Coronavirus, Tyler Law is providing this guidance to help REALTORS® and REALTOR® Associations respond to the impact on the real estate industry.

Recently, C.A.R. developed and released a new CORONA VIRUS ADDENDUM/AMENDMENT (C.A.R. form CVA 3/20) which is effective as of March 18, 2020.  The form provides that when circumstances related to the Coronavirus are affecting the closing date, the buyer and seller agree to extend escrow for a period of thirty (30) days or longer to accommodate these unforeseen events. The form contains an optional clause which permits the buyer and seller to mutually agree to cancel the agreement, as well as an additional optional clause which permits the buyer or seller to cancel even after removing the loan contingency if inability to fund is caused by a loss of income related to Coronavirus.

This CVA form can be used either as an amendment to a contract that is already in place or as an addendum to a contract that has not yet been formed. You can access this new C.A.R. form if you download it here.

In sum, this form refers to the Force Majeure Clause, a contractual provision which allocates the risk of non-performance when events such as pandemics or acts of god overtake the party’s ability to perform under their agreement. Although REALTORS® are responsible for taking reasonable steps to hold a transaction together, sellers cannot force buyers to remove contingencies if they cannot leave their home, and buyers cannot force closing if the replacement home the seller secured is not ready due to government restrictions of travel or similar orders to shelter in place.  Thankfully, C.A.R provided this form as a practical conversation and bridge between buyers, sellers, and REALTORS® in this turbulent time.

Because this form may evolve, we will continue to provide you with information and changes from C.A.R. Tyler Law is prepared to handle these issues professionally with grace and integrity, guiding REALTORS® and Associations with knowledgeable legal advice.  If you have any questions about the new form, employment law, remote work, or the like, please do not hesitate to contact our firm.