Many contracts executed preliminary to the regular form of land contract are defective in that they do not state sufficiently the terms of the land contract to be subsequently entered into. This is especially true of those preliminary agreements for the purchase of real estate, drawn by real estate brokers and others not skilled in the drafting of contracts. Frequently, the down-payment is made in a real estate office, and the preliminary agreement is executed in the form of a brief receipt containing only a small fraction of the terms and conditions

which the parties expect later to be embodied in the land contract. While such contracts may be sufficient to support specific performance and to satisfy the statute of frauds, they may not be sufficiently definite with reference to the provisions of the land contract to be later executed as to enable the vendee to enforce specific performance of such a contract as would fully protect him.37 Many of such agreements contain important omissions necessary for the protection of both parties. Every preliminary agreement for the execution of a land contract, in addition to containing the essential elements required by the statute of frauds, namely: The parties, description of the property, the purchase price, the terms of payment and time of performance, should as the occasion may require deal with the following additional subjects:

34. Cleveland Refining Company v. Dunning, 115 Mich. 238; Ada Dairy Association v. Mears, 123 Mich. 470.

35. Eggleston v. Wagner, 46 Mich. 618.

36. Eggleston v. Wagner-Supra.

(a) Date possession of the property shall be given to the vendee, and the amount to be paid upon the execution of the land contract.

(b) Payment of taxes, and special assessments, payment of insurance premiums, and who shall have the right to designate the company in which such insurance shall be effected.

(c) Keeping premises in repair or in condition as when sold.

(d) In case of a mortgage on premises, assumption of mortgage by vendee, when contract shall be paid down to the mortgage, if that is desired.

(e) If property vendor is selling is encumbered, such encumbrance should be excepted from the covenant to furnish an abstract showing clear title.

(f) Provision respecting the adjustment of rental collected in advance.

(g) How soon abstract shall be furnished, and what firm shall issue such abstract.

(h) Length of time vendee shall have to examine same.

(i) If abstract shall disclose defects in title, which are readily correctable, how long shall the vendee have to correct such defects.

37. Brin v. Michalsky, 188 Mich 401. Holding that where the preliminary agreement failed to specify when the vendee was to have possession, such an omission would not nevertheless vitiate the agreement, but would enable the vendor to retain possession until the contract has been paid out in full.

(j) Shall the contract contain a clause against non-assignment.

(k) If vendor does not hold legal title, but is himself buying on a contract, reference should be made to this fact, and the contract should be so drafted that the vendor contracts to show a merchantable title at date of closing, not in himself, but in the party holding legal title of record. In such cases, for the protection of the vendee, contract should contain a provision requiring vendor to exhibit his original contract, from time to time, so that the vendee may be satisfied that his payments are being kept up, and should also authorize vendee, in the event vendor fails to make the payments on his original contract, to make such payments on his behalf, and take credit for such payments thus made on his contract. The vendee's contract should also contain a provision prohibiting vendor from assigning his original contract without notice to his vendee, and requiring the assignee of said vendor to enter into an undertaking, agreeing to carry out the contract between vendor and vendee. While the sale of property by a vendor held only on land contract by the execution of a second contract is attended with considerable risk, the profession cannot ignore the fact that there are individuals who are willing to take that risk, and when they do, their interest should be safeguarded as far as possible.

Provision respecting the forefeiture of the land contract upon default by the vendee, and what notice, if any, should be required.

In the absence of special provisions covering these matters in the preliminary agreement, it is very doubtful if either party can compel the other to accept a land contract containing any stipulations or provisions not covered by the preliminary agreement. The additional terms above referred to vary quite widely in different forms of land contracts, and if the preliminary agreement simply calls for the execution of a land contract without providing what particular form is to be used, I am unable to see how such land contract could, over the objection of either party, be made to contain any terms not embodied in the original agreement.