Breaches Of Real Estate Contracts
Whether you’re growing your business or purchasing your first home, real estate contracts are long and filled with legalese, making them difficult to understand. They are also legal agreements that are enforceable in accordance with their terms.
The breach of a real estate contract occurs when any party (e.g., the seller, the buyer, the landlord, the tenant, etc.) fails to honor the agreed-upon terms within the contract. If you are being sued for breaching a real estate contract, or if the other party to the agreement has breached or is threatening to breach the contract, you have options and potential remedies. For that reason, it is important to contact an experienced real estate litigation attorney so you can make good legal decisions.
Types Of Real Estate Contract Breaches
Real estate contracts typically specify the rights and responsibilities of each party as well as the warranties provided by one party to the other. For example, the agreement will probably specify who is responsible for any real property or other taxes, who pays the closing costs, items included or excluded from the sale or transfer of the property, and when the transaction must be completed. If either party does not comply with their agreed-upon duties, they have breached the contract.
Whether you’re buying a house or renting an apartment, all parties involved in the transaction are held to the specific terms of the contract. Breaches of the contract can occur if:
- Payment is not received in time (rent or escrow).
- Deed is improperly delivered or not delivered in time.
- A warranty is breached.
- Seller refuses to transfer the title.
- Premises is deemed not habitable.
If a party has breached a contract with you in a real estate transaction, there are remedies available to you including:
- Litigation in court
Your first question is whether there is a dispute resolution term included in the contract? If so, then arbitration or mediation may be your only option. Second, is the breaching party the buyer or the seller? If the seller breaches the contract, and there is no alternative dispute resolution term in the contract, then he or she may withhold any deposit paid by the buyer, file a lawsuit seeking damages, or file a lawsuit for specific performance. A lawsuit for specific performance simply means that the seller is asking the court to force the buyer to comply with the terms of the contract and buy the property. Sellers who would rather have the contractually agreed purchase price and do not want to retain their property and possibly recover damages in lieu of a sale, file a claim for specific performance.
If the breaching party to the contract is the buyer, and there is no alternative dispute resolution term within the contract, the buyer can choose to terminate the contract and request a return of any money paid as a deposit, sue the seller for monetary damages suffered as a result of the breach of contract, and/or file a lawsuit seeking specific performance.
If you believe that a real estate contract to which you are a party has been breached, it’s imperative that you contact an experienced real estate litigation attorney. Here in Nevada, Carbajal Law represents both buyers and sellers in real estate litigation.