Seller Breach of Contract - Posted by Ernie Baxley

Posted by Tony-VA/NC on August 19, 2003 at 10:36:40:


This is not legal advice but rather a few suggestion for you to consider when you are speaking with your local attorney.

Begin with your contract. If the contract is signed by the seller and there are no contingencies for the seller to void the contract, then proceed further.

You mention that she signed the closing paperwork. What exactly did she sign? If you are able to close on the deal according to the contract then she has little to stand on even if she no longer wants to sell.

From the sounds of it, that Deed is not going to give you marketable title as the husband has not conveyed his interest. That will make it difficult for you to sell to a new buyer (who will most likely be obtaining bank financing).

You should consider filing a memorandum of your contract down at the court house for the jurisdiction that the property resides in. This will cloud the title and may require them to deal with you at a later time, if/when they try to sell to someone else.

What you now have learned is to get all parties to sign on the dotted line before moving forward. Having a title company you are familiar with (or in my state, a closing attorney) who protects your interest by conducting this search is a key part of your business team.

Can you file suit. Sure. Specific performance against the wife who signed the contract might be a start but keep this in mind. Legal fees and time to complete the suit may well eat up your desire and profit on this deal but it is something to consider.

I would also suggest you review the letter from the Broker. I would suspect that the broker has the right to advise his client to sell for more but if that letter was written after she signed the contract, it would seem to me that the broker is encouraging her to breach the contract. If there is evidence of this, you may wish to file a complaint on this broker and perhaps consider naming him/her in any lawsuit you may proceed with.

Again, I am not an attorney so simply take these suggestions with you to your attorney and see what, if any may be of help.

Best Wishes,


Seller Breach of Contract - Posted by Ernie Baxley

Posted by Ernie Baxley on August 18, 2003 at 20:40:06:

I was hoping to get some advice on my sellers breaching our sales contract. My partner and I had purchased a house for $125K cash with a one week escrow. Buyer was asking $179K but took our offer over others because it was all cash. We estimated fix up cost at 10K and had done our comps and talked to a few agents who estimated that is would go for 190-200K after fix up. After the contract was signed the sellers agent advised seller not to sell because the price was too low. They actually sent us a copy of the letter stating this to their seller. The seller and the agent/broker had an argument and the seller fires the broker. After this occurs the seller attempted to notify us and the title co. that she was not going to sell us the property. We advised the seller that she had signed a contract and we intended to hold her to it. At closing seller agrees to sign the closing paperwork and does so.
Sellers husband who resides in another state says that he will also do so. Seller then advises our agent/broker that she has no intention of selling us the house and has told her husband not to sign the paperwork. She is now suppossed to be leaving the state to go join her husband.
Unfortunately this happens to be me first REI deal and I do not have a Real Estate Attorney who can handle this although I did contact several today and will meet with them tomorrow.

What do we do? What are the ramifications of her and her husband breaching the contract? Our broker and the title co. employee say that they have never seen anything like this. We were planning on making some good money on this deal and would like to pursue whatever actions we need to take. Any advice would be helpful. I know that I must talk to an attorney for real legal advice but any hints would be helpful…