Legal Question in Real Estate Law in California

Promise to Return 1/2 Rent Paid if we Purchased Property / Not Kept

After a friend passed away, we made a verbal agreement with our friend's daughter to rent our friend's home with the intention of buying it after probate was completed. No agents were involved. The agreement was made in April 2003. The daughter (who lives in Arizona) agreed to sell at the appraised value used in the probate. We agreed to caretake the property and an adjacent vacant property and pay monthly rent. The daughter stated she would place 1/2 of the rent into an account, the total of which would be returned to us *if* we purchased the property. Many conversations were had thru the 2 yrs, especially when the housing prices rose and we were repeatedly assured she would keep her agreement. She didn't. After long and painful deliberation, we purchased the property for 20,000 more than the appraised value two yrs ago. We knew it was a risk w/out written agmt, but we are older (mr is 69) and very much wanted the property to not need to move again. We understand verbal agreements re real estate are not enforceable. Our question is: would the agreement to set aside 1/2 of our rent money be seen as a separate matter, i.e., we were not compensated for our caretaking time and expenses. Thank you very much.


Asked on 2/22/05, 6:41 pm

1 Answer from Attorneys
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: Promise to Return 1/2 Rent Paid if we Purchased Property / Not Kept

You are correct that agreements for transfer of an interest in real property, or leases for more than a year, need to be in writing to be enforceable. You are also on the right track in suggesting that you may be able to recover some damages on other legal theories. Further, even the basic lease-purchase option deal could possibly be enforced on one basis or another -- the statute of frauds requiring a written agreement has exceptions; or a sufficient writing to establish the existence of the contract might be found in letters, credit applications, signed checks, or any number of documents that aren't true leases or options.

I would guess you have a little better than 50-50 shot at recovering anough to make bringing suit worth while. I think your next step should be to ask for a free initial consultation with one or more real-property attorneys in your area.

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Answered on 2/23/05, 12:31 pm


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