Legal Question in Real Estate Law in California

buyer breach of contract

In August 2002, my 84yr.old mother entered into contract negotiations with a potential buyer (a real estate agent) of her home. In October the ''buyer'' and she signed a cash contract with escrow instructions to close on 1/5/03. About 1/12/03 the ''buyer'' indicated he was having difficulty funding a loan. He has not made further contact. This month she wrote a letter questioning his intentions and stating he was in breach of his contract. Can she sue for any damages? This situation has tied up her ability to proceed with any other marketing of the property.


Asked on 2/24/03, 5:52 am

3 Answers from Attorneys

Sandee Chadwick LAW OFFICE OF SANDEE L. CHADWICK

Re: buyer breach of contract

If your mother performed all of her obligations under the contract, except those that she could not because of the buyer's breach, she should be able to enforce the contract.

Also, your message doesn't say so expressly, but it sounds like the buyer also acted as your mother's agent. If so, he/she has heightened duties to your mother. If your mother was represented by her own agent, that agent should be working to get the escrow closed or canceled.

Without knowing all the facts or reviewing the documents, its difficult to advise you on what steps your mother can and should take.

If the value of the property is climbing (as most property in California is), she may be better off to get the escrow canceled and find a new buyer. If, on the other hand, it will be difficult to sell the property to someone else at the same price, she may want to enforce the contract. In that case, I would recommend that she try to contact the buyer and try to work out the close of escrow before resorting to litigation. If that doesn't work, she can explore litigation. An attorney can a great help with any of these options.

I have a good deal of experience in this area of law. Please feel free to contact me should you want a consultation.

Thank you.

Read more
Answered on 2/24/03, 12:05 pm
H.M. Torrey The Law Offices of H.M. Torrey

Re: buyer breach of contract

if your mother has incurred damages due to this delay, she has rights to recover such damages or sue for specific performance of the real estate sales contract, based on the facts given so far. depending on the circumstances and the current market value of the home, she may prefer one remedy over the other. if you would like further assistance, feel free to email me more facts and i may be able to further assist you legally on this matter.

Read more
Answered on 2/24/03, 3:17 pm
Chris Johnson Christopher B. Johnson, Attorney at Law

Re: buyer breach of contract

The answer depends on the contract. Is there a liquidated damages provision equal to a percentage of the sales price, and is there a deposit from which to take the damages? Did the contract have a deadline for the buyer to obtain financing even before the closing date? Did your mother actually incur measurable damages? She should be able to cancel the contract and move ahead with selling to someone else, as the buyer failed to meet his obligations, but the answer depends on their contract, which should be reviewed by an attorney to ensure she can proceed with selling and to see what, if any, remedies she can pursue for any damages caused by the buyer's breach.

Read more
Answered on 2/24/03, 5:35 pm


Related Questions & Answers

More Real Estate and Real Property questions and answers in California