Legal Question in Real Estate Law in California

Re: cancelling an escrow

No one can truly advise you whether or not you can cancel your agreement without knowing more information.

For example, is the buyer in breach? Has the buyer failed to remove a contingency in a timely fashion, and if so, have you or your realtor sent a notice to perform which has gone unanswered? The answers to these questions, and others, are absolutely vital before anyone can have a meaningful opinion regarding your right to cancel the agreement.

I would be happy to discuss this with you.

Re: cancelling an escrow

An escrow holder is a contractor and fiduciary for both the buyer and the seller. With few exceptions, they can only operate according to instructions given them by BOTH parties. Also, "canceling" an escrow does not also cancel the agreement to sell the property.

Therefore, the escrow company will release any deposits and return any papers only when instructed to do so by both parties, or by a court. There may be limited exceptions.

The elderly person here needs to be concerned about the agreement she made to sell, not the escrow.

This requires a negotiation with the buyer, preferably handled at least initially by the licensed professional real estate salespeople who represented the buyer and the seller in negotiating the sale in the first place. If there are no agents or brokers involved, maybe the seller should retain a lawyer. This situation could get antagonistic and messy in a hurry.

The lady needs to understand that a contract to sell real estate can be enforced by what is called "specific performance," in which a court orders the seller to complete the transaction. It isn't simply a matter of paying money damages and the contract obligations go away. The buyers, if they want the house badly enough, can force a sale in compliance with the agreement of sale and probably get costs and legal fees as well (check the agreement to see if it has an attorney fee clause).

So, my recommendation is to get someone with negotiating skills to work on behalf of the seller to try to negotiate a cancellation or rescission of the agreement. Note that there may be a liability to the agents or brokers for their commissions, since they have earned them and are probably legally entitled to them even if the sale doesn't close.

Using a lawyer has another possible advantage; there may be a loophole in the enforceability of the contract that might make it void or voidable. Probably not, but a lawyer should look for it as a possibility.

Re: cancelling an escrow

As Mr. Whipple so adequately explained, you cannot get out of this very easily.

You must realize that, even though few people read the small, or fine, print in documents, the law presumes that when you sign something, you have read it and agree to the meaning of the words.

She needs to retain a real estate attorney ASAP, though it is probable that nothing can be accomplished at this stage.