Legal Question in Business Law in New York

Re: contract

Look at your contract. Most standard forms have a provision dealing with 'risk of loss'. I would venture to say that your contract probably provides that you have the burden if the property is destroyed, and that would make sense because the purchaser generally would not carry insurance on the home until he bought it.

There is also probably a clause saying the buyer will take the house "as is". That means as it exists on the date the contract was signed.

Now, if you are saying that the house was there one day, then destroyed by a fire, and the contract was signed on the date of the fire but neither party was aware, then the legal reason is mutual mistake. You can only have a contract if there is a meeting of the minds. If the contract contains provisions about a dwelling and no dwelling exists, that shows that both parties intended the transaction to include a dwelling. Also, there are probably clauses describing that the house must have a valid certificate of occupancy, etc. If both of you believed there to be a house, and both of you were mistaken, then a basis exists to rescind.