Andrew Wetzel's Musings

June 16, 2017

Time is of the essence in practice

Filed under: Uncategorized — awetzel @ 5:05 PM

The PAR Standard Agreement for the Sale of Real Estate uses the phrase “time is of the essence” in paragraph #5, line #50, to reinforce the fact that the dates and time frames agreed upon in writing by a seller and a buyer are the essence of the agreement and are binding unless and until both parties modify any specific terms.  Simply stated, this means that a party either has an “option” OR a requirement, depending on the task involved, to do something within a certain time, regardless of whether the “end point” or “due date” is expressed as a specific date (such as June 16, 2017) or as a number of days (such as “within 10 days ….).  Failure to meet the due date could result in that party losing the option (such as the right to inspect) OR being held in default (such as when failing to provide a deposit or to get the property to settlement).

The term “time is of the essence” also generally applies to most events involving decision-making.  In other words, many situations involving two (or, in theory, more) parties reaching an agreement about something rests on the factor of time.  Whenever we are faced with or pursue a decision, we need to understand that the scenario is not on-hold, frozen in time, waiting for us to satisfy ourselves before moving ahead.  Those of us who tend to be very analytical may too easily drift into what some refer to as “paralysis by analysis”:  we wait for yet another indication of whether we should move forward or not and, if so, how quickly and by how much.

Years ago I started using the phrase “not to decide is to decide”.  Frankly I am not sure whether I invented it or I picked it up along my travels but it is so true.  If we wait long enough to make a decision we may find that whatever it is that we were thinking about is no longer the case.  Fortunately, my life experience also tells me that some of the best decisions are the ones we do not make.  “If only I had done that” sounds like words of regret but can actually be very positive.

We have to understand that like is a complex amalgamation of many moving parts and that many wheels are turning at the same time.  When faced with a decision, we need to fully understand whether it is important or urgent, determine what we need to know before committing ourselves and, ultimately, what the cost might be for making the wrong decision or losing the opportunity to decide because others took action before we did.  No one will get it right 100% of the time and being decisive is not always best.  Perhaps all we can do is learn from our mistakes.  That is smart but not so easy to do.  Ask anyone who bailed out on Microsoft!




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