Importance of The Mailbox Rule

Last Updated on Sunday, 27 August 2023 03:22 Written by Chris Griswold Tuesday, 12 March 2013 07:46

This month, we’re going to talk about something you hardly ever hear about – the “mail box rule”. It’s something that affects everyone…. Towards the end of 2012, with forthcoming tax changes looming on the horizon, property owners everywhere were selling property like it was going out of style (and for good reason). I had a client who was eager to close on a certain large, commercial warehouse space. The fact pattern gave rise to the application of the mailbox rule – something that sounds pretty dull…but isn’t. The information provided below will apply to most everything you do with important mail. Check it out, and don’t forget to click on my Facebook or YouTube links below to also see my short video on this material.

Importance of The Mailbox Rule

What is the Mailbox Rule? Simply put, the rule is something (out of old common law) which says that a written offer made by someone through the mail is effective upon the intended recipient’s actual receipt of such offer. Likewise, the rule says that, absent language in the contract which requires that actual receipt of such acceptance shall occur by or within a date certain, the recipient’s acceptance of such offer is effective “upon dispatch” (i.e., the date and time which the recipient physically places such written acceptance into the mailbox with a postmark upon it showing such date and time).

Facts: Basically, the parties wanted to close the transaction by 12/31/12. However, the property was encumbered by a lease (a contract) which gave the lessee a right to purchase the property before any sale could occur; such right to be exercised by tenant within thirty (30) days of tenant’s receipt of notice of the proposed sale from landlord (seller). Long story short, the parties wanted to provide written notice to the tenant of the contemplated sale; thus asking the tenant to either accept (or not accept) a purchase of the property on the same terms as offered to the buyer (my client).

By the time my client approached me on 11/24/12, time was getting short…. Furthermore, the lease didn’t have any language in it that required tenant’s notice of acceptance (or non-acceptance) to be actually received by landlord by any date certain (just the language above which required such right to be exercised by tenant within thirty (30) days of tenant’s receipt of notice from landlord of the proposed sale). The seller, seller’s counsel, the brokers involved, my client, the title and abstract company (and their counsel) all suggested that landlord simply provide tenant with written notice of the proposed sale; thereby giving tenant thirty (30) days to either accept (or not accept) such offer. Since it was still only 11/24/12, with 12/31/12 still being more than thirty (30) days away, everyone felt confident that tenant’s rights under the lease would be addressed and all requirements on the title insurance commitment could be safely met and satisfied, and, if no acceptance (or non-acceptance) was received back by landlord by 12/31/12, then a closing on the property could safely occur on 12/31/12.

What’s the problem here? What if tenant “dispatched” its acceptance to purchase the property on 12/22/12 (assuming that tenant received our written notice on 11/25/12 – the day after we mailed such notice to tenant on 11/24/12) and, given the increased number of parcels/packages deposited into the United States mail during the holidays, such acceptance wasn’t received by seller (the landlord) until after 12/31/12? By that time, my client would have already closed on the property thus violating the terms and provisions of the lease (which, by the way, had lengthy damages and remedies provisions for violating tenant’s rights). See the problem? The tenant’s acceptance and dispatch of such offer on 12/22/12 would have, unbeknownst to either landlord (the seller) or my client (the buyer), already legally and validly occurred back on 12/22/12 and, due to problems and/or delays with the mail, the parties would have closed anyway on the property thus violating tenant’s rights.

Critical point to keep in mind…. Remember the mailbox rule for your own closings, other contractual dealings and come time to mail in your insurance premiums. Also, don’t forget about this rule when timely exercising your lease options to extend the lease term (including when your tenants exercise their lease options).

What My Clients Are Saying

“Chris Griswold is the answer man. When I have real estate questions, Chris is quick to reply with solutions and advice that is right on target. I can always trust my clients to Chris’ care knowing he will treat them with courtesy and integrity.” Darryl Meason / Broker Associate / NAI Sullivan Group / Oklahoma City, Oklahoma

Arbitration v. Mediation

Last Updated on Sunday, 27 August 2023 03:22 Written by Chris Griswold Tuesday, 5 February 2013 03:11

It’s hard to believe it’s already 2013!  Looking at my family over the holidays, I could see all the things I’m thankful for….  It’s my hope that everyone reading this was also that lucky.  This month, I want to discuss the differences between arbitration and mediation, what each accomplishes, and why each is important, among other things.  See more below (and don’t forget to click on my Facebook or YouTube links below to also see my short video on this material).

Arbitration v. Mediation

Everyone has heard of arbitration and mediation, but what are they?  Well, they’re both ways of resolving conflict outside of the courts.  States such as Texas (and others) have already mandated that parties attempt to settle their differences during a mediation session – all after the petition is filed; but prior to their case coming on for trial.  Oklahoma does not yet require mediation at any point in the life-cycle of a dispute; however, it may at some point.  For now, just know that parties in Oklahoma can still voluntarily elect to go through mediation at any time after a dispute arises, whether before the filing of a lawsuit or prior to trial (read more below).

What reasons justify parties going through mediation or arbitration?  First, it reduces/eases the dockets the courts must carry and, in so doing, cuts down on the taxpayers’ burden of funding the court system.  Secondly, given that so many cases seem to historically settle prior to trial, arbitration and mediation give parties more of a realistic, meaningful chance to resolve their differences prior to going to trial (i.e., arbitration and mediation reinforce what seems to normally happen otherwise).  Put another way, during mediation and arbitration sessions, the parties can more easily see (and appropriately respond to) the corresponding strengths and weaknesses in their respective positions – all prior to darkening a court house.

What’s the difference between mediation and arbitration?  Generally speaking, an agreement produced in mediation is not binding upon the parties after the mediation session.  In contrast, an arbitration award/agreement is binding upon the parties (just like a court order).  Accordingly, arbitration can be viewed as a substitute for going to court.

Can arbitration or mediation be required prior to trial or filing suit – even in Oklahoma?  Yes, if the parties write such a requirement into their contract ahead of time (i.e., at the beginning of their relationship).  If no such requirement is written into the contract, then it’s not required.

Half-Day v. Full-Day Mediation Sessions.  Generally speaking, the parties can mutually agree to do either a half or full-day mediation session.  Half-day rates cost roughly half of the full-day rates (not surprising).  Half-days usually last for four (4) hours and full-days usually last eight (8) hours.  The parties have to each pay their own respective half of the mediation fee to the mediator.  Full-day sessions, for whatever reason, seem to produce the most resolution.  Why?  After a full-day of negotiating together and paying the mediation fee (usually in excess of $1,000 per party for a full-day rate), the parties are pretty vested in the process.  It’s kind of like “The Breakfast Club” where they’ll try to get it right by the end of the day….

What My Clients Are Saying

“I have used Chris for matters relating to both my own personal neighborhood association and for business transactions at work.  He is always very prompt and easy to reach.  He gets me what I need when I need it and does quality work.  I would highly recommend him.”
Chris Moxley / V.P. of Operations / Professional Insurors Agency, LLC / OKC, Oklahoma

Defining Legal Language found in Deeds

Last Updated on Sunday, 27 August 2023 03:22 Written by Chris Griswold Thursday, 11 October 2012 02:38

Just the other day, my little girl, Mackenzie (just turned 3 this August!), locked herself in our bathroom.  After a couple of minutes, I was able to get the scared child out.  The hero’s welcome I received felt good.  It’s funny how the smallest things mean volumes to children.  Same thing with the law….  A better understanding of the smaller details found in documents can set you free and empower you.  Accordingly, this month, I want to explain, in laypersons’ terms, the meaning of certain, cryptic legal terms often found in your average deed to real property.  See more below (and don’t forget to click on my Facebook or YouTube links below to also see my short video on this material).

Defining Legal Language found in Deeds

Sooner or later, we all have to read or examine a deed.  Whether it’s a general warranty deed, a special warranty deed or a quitclaim deed – they all have certain terms contained within them that make the average non-lawyer want to retain counsel.  Some of these terms are:

Consideration:  No contract is valid without consideration and a deed, which recites promises exchanged between the parties to the deed, requires that consideration be exchanged.  It’s important to note that unless a deed is passing to one’s family member on the basis of “love and affection” as the sole form of consideration to be paid, all other deeds must recite that at least ten and no/100 Dollars ($10.00) was given in exchange for and in consideration of such deed ($1 for automobiles).  For privacy reasons, parties usually elect not to recite the actual amount of consideration paid for the property in excess of the $10 recitation requirement.  By law, a deed (a written document) is presumptive evidence that consideration was in fact exchanged by the parties (unless proved otherwise in Court).

Heirs, Executors, Administrators:  These are usually found in the deed as running to the grantee’s “…heirs, executors and administrators,” although not necessarily in that exact order.  “Heirs” are persons that are to expressly inherit stuff under the grantee’s Last Will and Testament.  They can be anyone.  “Heirs at law” are people that take under a Will by law pursuant to intestate succession (i.e., the person died without a Will so the law sets forth that certain persons, usually family members, inherit pursuant to a certain order).  “Executors” are people who serve as the decision maker of the grantee’s estate pursuant to express statements found within the grantee’s Last Will and Testament.  “Administrators” are people who do the same job but are appointed by the probate court to be the decision maker since the grantee died without a Will.

Tenements, Hereditaments. This is additional stuff that a grantee gets under a deed.  “Tenements” mean the property/fee estate itself which is to be held by grantee (although people sometimes think it means the structure(s) on the property/fee estate (which is okay since these are actually “improvements” which also go to grantee)).  “Hereditaments” are anything capable of being inherited by grantee’s heirs (whether by or through a Will or through intestacy).  This includes both tangible hereditaments (which are hard, identifiable things like the land itself, buildings and fixtures) and intangible hereditaments (things which aren’t tangible, like easements, rents, etc… that run with the land).

What My Clients Are Saying

“Chris Griswold has always been proactive and professional.  He takes the time to work with us and tailors his approach to our situational needs.  My favorite thing about Chris is that he will let me know if there is an easier, less-expensive approach.  We look forward to working with him well into the future.”
Carl S. Milam / President / Western Concepts Restaurant Group / OKC, Oklahoma