Standard clauses - 4 - Amendments to the Promise to Purchase
4.1 – Further inspection
Following receipt of the inspection report dated __________from the firm __________dated __________suggesting a more in-depth inspection of __________(identify the component or system to be inspected), the parties agree to amend the time period of __________days provided for in the inspection clause ____ of the promise to purchaseto a time period of __________days in order to allow the buyerto proceed with the suggested inspection.
4.2 – Price reduction
Following the pre-purchase inspection performed by _________________ of the firm _________________ on ________________ , the parties agree that the purchase price shall be reduced to $_____________ to account for the work to be performed for ______________ (describe the work). The BUYER acknowledges that the legal warranty of quality shall not apply to the subject of this price reduction.
Note: This approach is preferable over stipulating the seller's obligation to have specific work completed within a specified time period. This could be difficult to enforce if, for example, the seller partially or inappropriately fulfills this obligation. The issue would then be to determine what to do with the amount held in trust by the executing notary. Using the suggested clause would avoid many disputes of a similar nature.
It should also be stressed that when the buyer tries to get a reduced price, a signed amendment notice should not be sent. Such negotiations must be done verbally or via UNSIGNED amendment notices exchanged by the parties within the time periods set out in the inspection clause of the promise to purchase. Indeed, once these deadlines expire, the buyer is deemed to have waived this inspection condition.
Once an agreement is reached, the suggested clause can be included in the Amendments form, which the parties will then sign.
