Legal Question in Real Estate Law in California

Re: Who has rights to this particular property?

The basic rules for making a valid contract are as follows:

Buyer X makes an offer to Seller Y; then

Seller Y accepts Buyer X's offer.

At that point, the parties are in contract, and Y cannot sell the same property to Party Z.

In your case, you are Buyer X. You submitted an offer to Seller Y. However, Seller Y did not accept your offer. Seller Y rejected your offer and made a counter-offer (with differing downpayment and loan payoff terms). No contract was formed.

However, you were now in a position to form a contract by accepting Seller Y's counteroffer while it was still open, which you attempted to do, only to find out that Seller Y had offered the same property to Party Z.

The issue is whether Seller Y's counteroffer was still valid at the moment you attempted to accept it, or whether it had expired or had been revoked so that it could no longer be accepted.

In real estate, most offers and counteroffers are made on pre-printed forms that call for the offeror to write in a deadline for accpetance. The first question here is, then, whether Seller Y's counteroffer specified a time limit for its acceptance by you, Buyer X. If so, and the time had expired, you're out of luck; Y and Z have a valid contract and you have no claim for damages.

If, on the other hand, you tried to accept Y's counteroffer within a specified time limit, or if none were specified, within a "reasonable" time, you may either have a contract with Seller Y that defeats Party Z's supposed contract, or you may have a good claim for damages. More likely the latter, because even though you were the first to receive an offer (i.e., Seller Y's counteroffer), Party Z was the first to accept, and that, however wrongfully, may preclude your making a valid and effective acceptance. So, you are probably entitled to damages, for "breach of offer" but not to specific performance of a contract.

Re: Who has rights to this particular property?

I would like to add to my prior answer. After a little research, I believe the seller would find himself in two conflicting contracts, and obviously unable to perform on both.

(However, one reference suggests that many counteroffers contain provisions permitting the seller to accept an offer from a third party while the counteroffer is pending, and that accpetance of such an offer terminates the counteroffer with or without notice to the counter-offeree. You should look for such a clause in the counteroffer. If it's there, it knocks you out just as surely as would an expired time limit.)

If both "buyers" sue for specific performance, a court must choose which buyer's contract to enforce by way of specific performance, i.e., who gets the property, and which buyer gets only money damages.

Specific performance is an equitable remedy, and courts are more goverened by principles of overall fairness rather than strict, mechanistic rules of contract law in awarding it.

If indeed there are two buyers in contract for the same property. I cannot predict the outcome as to which gets the property and which gets money damages without much more research. Maybe another LawGuru attorney will jump in here with some good case law. I don't have it.

Re: Who has rights to this particular property?

The other purchaser accepted prior to you and probably has a superior claim to the land. It appears you have a valid contract though, and if so, you have a claim for breach of contract and damages. You may contact me if you want to sue for damages.

Re: Who has rights to this particular property?

the early bird catches the worm and the property in this case. you can if they accept it use yours as the first, if that is the position now, backup offer if something goes arey with the current accepted offer -- you hopefully learned something in this situation -- good luck