Posted by Mike on August 15, 2003 at 20:59:11:
“You can put a clause in your contract that says your deposit will act as liquidation damages and no other liability.”
Great idea! Thanks.
Do sellers ever sue buyers into closing? - Posted by Mike
Posted by Mike on August 13, 2003 at 13:57:25:
I’ve been buying and selling land, all are deals under 20,000. I’m wondering what might happen if I back out of a deal at the last minute on a deal once and a while. How common is it for a seller to sue a buyer into closing on a deal? I have no problem losing a deposit but I don’t want to get pulled into legal proceedings if I back out on a deal.
My mother did. - Posted by GL - ON
Posted by GL - ON on August 13, 2003 at 21:07:21:
We sold a 100 acre development property to a developer just before the 80’s boom died.
Short version:He welshed on a $2,000,000 deal. We sued. It took nine years. We had judgement against him for a total of $3,600,000 in damages, penalties and interest. In the end we settled for $750,000 plus costs. We kept the farm.
The case made it into the Law Report of the Law Society of Upper Canada because no one had ever pushed such a suit so far before ( to the supreme court). If you want to look it up, look for Lubben vs. Veltri.
Who knows? - Posted by Ronald * Starr(in No CA)
Posted by Ronald * Starr(in No CA) on August 13, 2003 at 19:41:55:
Mike------------
Who knows? For that amount of money, probably not. Even for more substantial sums it often is not worth pursuing, as another buyer can be found and so there is only minor damage to the seller–usually a delay in the sale.
On the other hand, your reputation is very important. The idea is to tie up the property with a purchase agreement or contract. Included are some clauses which let you withdraw from the purchase if there something not to your liking. Such as something on the title report, something revealed from inspecting the property. Unavailability of utilites, zoning issues, etc.
Usually you can write it so you get back your deposit if you withdraw for one of the reasons in the contract.
Good InvestingRon Starr**
Re: My mother did. - Posted by Mike
Posted by Mike on August 14, 2003 at 11:57:29:
Wow. I suppose I would sue too if it was 2 million big ones.
Re: My mother did. - Posted by GL - ON
Posted by GL - ON on August 15, 2003 at 07:01:29:
Such suits are rare. As I said no one ever pushed such a case so far in Ontario before.
But if you welsh on a deal you can be sued for specific performance ( you must take the property) and / or damages.
You can put a clause in your contract that says your deposit will act as liquidation damages and no other liability.