A 72-hour clause, typically inserted in real estate sale contracts, is also known as an

escape clause An escape clause is any clause, term, or condition in a contract that allows a party to that contract to avoid having to perform the contract. If an agreement was drawn up for the sale of a house, for example, the purchaser could include some k ...

, release clause, kick-out clause, hedge clause or right of first refusal clause. The 72-hour clause is a

seller Sales are activities related to selling or the number of goods sold in a given targeted time period. The delivery of a service for a cost is also considered a sale. The seller, or the provider of the goods or services, completes a sale in r ...

contingency which allows the seller to accept a

buyer Procurement is the method of discovering and agreeing to terms and purchasing goods, services, or other works from an external source, often with the use of a tendering or competitive bidding process. When a government agency buys goods or serv ...

's contingent offer to purchase his/her

property Property is a system of rights that gives people legal control of valuable things, and also refers to the valuable things themselves. Depending on the nature of the property, an owner of property may have the right to consume, alter, share, r ...

, while allowing the seller to continue to market the property. If the seller now receives another (better) offer to purchase the same property, he/she can also accept this offer, as a back-up offer. The seller can then activate the escape clause by notifying the original buyer about the back-up offer. Wednesday, 16 December 2020 The first buyer now has a specified period of time to fulfil all the buyer contingencies in the contract of sale, or cancel the contract and lose the property. If the buyer cannot fulfil the contingencies in time, the original contract will cancel and the back-up offer will move into first position. The term 72-hour clause can be somewhat misleading, because the notice period within which the buyer must fulfill the buyer contingencies can be negotiated. The effective notice period may therefore be longer or shorter than 72 hours. Further ambiguities arise if the 72 hours were only considered counted on business working days, excluding weekends and

legal holiday A public holiday, national holiday, or legal holiday is a holiday generally established by law and is usually a non-working day during the year. Sovereign nations and territories observe holidays based on events of significance to their history ...

References

. Real property law Contract clauses {{Realestate-stub