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Real Estate Sales Contracts: Avoiding the Doctrine of Merger

On Behalf of | Apr 14, 2014 | Sales Contracts

In any given transaction, no one is ever happy with getting less than they bargain for. When it’s milk that goes bad too fast, we tend to grin and bear it. In bigger scale transactions, such as the sale of land, anything less than what was bargained for is unfair and unacceptable.  Thankfully, the often rigid rules applicable to sales contracts will sometimes bend as justice requires.

When you’ve understood your deal to entitle you to more, you should contact a real estate sales attorney who can review your contract with you to make sure you get what you’ve bargained for.

Last week we wrote about the doctrine of merger, and how it operates to extinguish early contract guarantees not ultimately included in the deed of conveyance. But what if the deed should have included everything bargained for in the agreement for sale? What if some portion of the property is omitted, due to fraud by one of the parties or by some mistake? Fortunately, the doctrine of merger will not always apply when some terms are erroneously excluded.

Just last month, the Oregon Court of Appeals decided a case involving the doctrine of merger, where portions of a property included in the agreement of sale were ultimately omitted from the deed. In that case, the agreement for sale detailed a number of separate parcels of property that would be sold as part of the deal. Nearly six years later, the purchasing party realized that certain parcels were not included in the deed that had been part of the original bargain.

Although typically the doctrine of merger would have operated to extinguish the purchaser’s right to claim those parcels as part of the deal, the Court decided it would not apply in this case. Where there is fraud or mistake that induces a purchaser to accept less than what they bargained for, the doctrine of merger will not apply.

Of course, this rule is not so black and white. What constitutes fraud or mistake will require a careful consideration of the parties’ agreements. If you think you’ve ended up with less than you bargained for, a real estate law attorney can help make sure you receive what you’re entitled to.