Legal Question in Real Estate Law in California

Re: release of contract

I don't understand why it takes a permit to convert a bedroom to a dining room. Assuming that is correct if the room in its present configuration isn't permitted. You made an offer on the house meeting code. It doesn't meet code. So the sellers should release your deposit, cure the defect, and re-list the house for sale. However, I'd make certain that the changes in the use of a room require a building permit. Minor changes in lighting and wiring do not require building permits and re-inspections. If it doesn't my little analysis falls apart. And you're in breach of contract, may lose your deposit, and possibly suffer the cost of defending a breach of contract law suit. The county building departments have easy to read handouts on what construction requires building permits, etc.

Re: release of contract

Generally, contracts are written with dozens of escape claused for buyers.

Is the reason that you want to back out because of the lack of permits, or have you just gotten buyer's remorse.

The seller should be aware that there is a $1000 statutory penalty for failing to sign a release in bad faith. Also, he will be unable to sell his house if you sue for your deposit back, and you place a lis pendance on the property.

The bottom line is that you can ask for the moon on repairs, etc. If they don't agree to make them, you can probably back out on that basis.

The seller's wisest decision would be to put the house back on the market, and find another buyer.

Re: release of contract

If the work means the house is not in compliance with the city's codes, and the seller said it was, you can require they fix it or get out of the deal. If they refuse, the contract probably calls for arbitration or mediation, so make your mediation/arbitration demand.