Legal Question in Real Estate Law in Massachusetts

Filing suit for specific performance

I agreed to purchase a foreclosure property from a lender on 1-29-09. I overnighted contract with a $5000 check and waited 6 weeks for a signed agreement which arrived on 3-10-09. Closing was to be on 4-10-09. My attorney had the title researched and ironically the examiner had previously worked on the same title for another buyer. The foreclosure was not done properly and the title was a mess. The bank made no effort to clear the title, and on 4-22-09 emailed me that they want to return my deposit as the title issues cannot be resolved. I offered to wait, or purchase the note from them and they did not respond. I did not sign a release, and they are still holding my $5000 deposit in escrow. Their agent is now (one day later) advertising the property again, with a note ''back on market, buyer's financing fell through''. It is the same comment that was on the listing when my offer was accepted. Unfair and deceptive by any standard.

Questions:

1. Can I file a lawsuit for specific performance?

2. The title defects that were well known to the seller were not disclosed, does that help my case?

3. Are they obligated to make some ''good faith'' effort to clear the title?

Thanks for your opinions,

DS


Asked on 4/24/09, 9:07 am

2 Answers from Attorneys
Christopher Vaughn-Martel Charles River Law Partners, LLC

Re: Filing suit for specific performance

Although the Contract to Purchase or Purchase and Sale Agreement will govern your specific case, generally speaking your damages will be limited to a return of your deposit.

Normally, you wouldn't have Consumer Protection remedies against a seller, but the fact that the seller is a bank could change that dynamic.

I will be interested in the thoughts of others on this.

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Answered on 4/24/09, 9:16 am

Re: Filing suit for specific performance

I do not think under the terms of the standard bank purchase and sale agreement you can get specific performance.

You can however file a complaint with the attorney general's office and the department that regulates banks and real estate agents, stating that the are presenting misleading and deceptive information.

The bank and the real estate agent are making a terrible mistake because if the foreclosure is defective no good attorney is going to agree to the sale for his client.

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Answered on 4/24/09, 1:39 pm


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