Jun 18, 2009

Tip 21-2009: Propane Gas Proration

Propane Gas Proration:

The standard residential contract provides in Paragraph Nine that the propane gas will be paid by the Buyer at closing to the Seller. Normally, the Seller or their Realtor calls the propane company to assist in calculating the amount of gas in the tank and the current market price. AmeriGas has recently changed their procedure which could mess up the contract practice. If AmeriGas is aware of a pending sale, they sometimes will put a lock on the actual propane tank and will pay the Seller directly for the propane prior to closing. (AmeriGas claims they only "lock the tank" when asked to do so.) AmeriGas then expects to be paid by the Buyers for the gas before they will remove the lock. Accordingly, if your closing has an AmeriGas propane tank someone needs to verify prior to closing as to who actually owns the propane (the Seller or AmeriGas).

Please contact me if you have any questions.

William D. Tucker, III
Tucker Griffin Barnes P.C.
Charlottesville, Virginia

1 comment:

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