New Jersey Supreme Court Updates Rules for Notice of Disapproval of Real Estate Contracts

On April 3, 2017, a unanimous New Jersey Supreme Court handed down its decision in the case of Conley v. Guerrero. In doing so, it modified its 1983 ruling in the case of New Jersey State Bar Ass'n v. New Jersey Ass'n of Realtor Boards, 93 N.J. 470 modified 94 N.J. 449, which held that to comply with N.J.A.C. 11:5-6.2(g)(2), an attorney's notice of disapproval of a contract of sale must be made within three business days "by certified mail, by telegram, or by delivering it personally." Of course, changes in technology since 1983 have caused new methods of notice to be adopted by attorneys including facsimile and, in recent years, electronic mail.

In Conley v. Guerrero, the Court recognized these new methods of communication being commonly used in the industry, and "exercised its constitutional authority over the practice of law [to] find that an attorney's notice of disapproval of a real estate contract may be transmitted by fax, e-mail, personal delivery, or overnight mail with proof of delivery." Left unchanged by this case are the requirement that the notice must be sent within three business days of contract ratification, and the effectiveness of notice by mailing being the date of mailing, not receipt.

While the ruling here may not affect how business is currently conducted in the state, it does reinforce the legitimacy of the common customs by updating standards obsoleted by more than 30 years of technology.