Negotiating Survival Clauses and Holdback Provisions in Commercial Real Estate Sales Transactions

Avoiding Pitfalls of Merger Doctrine at Closing and Beyond

A live 90-minute CLE webinar with interactive Q&A


Tuesday, August 7, 2018

1:00pm-2:30pm EDT, 10:00am-11:30am PDT

or call 1-800-926-7926

This CLE webinar will discuss strategies for buyers and sellers negotiating survival clauses in commercial real estate transactions. Our experienced panel will offer critical insight on crucial terms for inclusion, duration, pitfalls to avoid, along with how survival provisions interplay with holdbacks to minimize risks beyond closing.

Description

The merger doctrine holds that when parties convey real property by a deed, all prior covenants, agreements, proposals, stipulations, etc. between the parties regarding the conveyance are merged into the deed and superseded. The doctrine is based on the premise that the deed represents the final and entire contract between the parties, and when strictly applied, prevents any prior promise from surviving beyond escrow. The only obligations between the parties are those outlined in the deed.

Survival clauses allow buyers and sellers to sidestep this potentially troublesome practice by providing a means to address the balance of potential risks that can only be resolved after the closing has occurred. Issues like indemnification for expensing relating to a respective party’s time of ownership and “true-ups” of outstanding taxes or utility expenses typically remain unresolved by the closing date and, as such, must survive.

Likewise, buyers are unable to accept the seller’s representations and warranties without a means of recourse for breach. Increasingly, parties are relying upon holdback provisions as a means of addressing potential liability for breach of these various survival clauses.

Listen as our panel of seasoned real estate practitioners discusses critical considerations when negotiating survival clauses, and how holdback provisions can impact their effectiveness in commercial real estate sales agreements.

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Outline

  1. The merger doctrine
  2. Survival clauses
    1. What survives closing
    2. Duration
    3. Considerations for sellers
    4. Considerations for buyers
  3. Interplay with other provisions
  4. Holdbacks

Benefits

The panel will review these and other relevant issues:

  • How can parties effectively address survival language in transactions that terminate without closing?
  • How can counsel for buyers and sellers structure survival clauses for “as-is” sales?
  • What practical considerations should counsel for buyers and sellers make when negotiating scope and duration of survival clauses?

Faculty

Brooks, Scott
Scott D. Brooks

Partner
Cox Castle & Nicholson

Mr. Brooks has vast experience in all aspects of developer/owner representation, including leasing, acquisitions and...  |  Read More

Norstadt, Christine
Christine R. Norstadt

Founding Member
Pursley Friese Torgrimson

Ms. Norstadt’s practice is focused on commercial real estate transactions and litigation. Her clients...  |  Read More

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Strafford will process CLE credit for one person on each recording. All formats include program handouts. To find out which recorded format will provide the best CLE option, select your state:

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