QUESTION
Seller not signing escrow cancellation, want liquidating damages
Asked on Sep 09th, 2015 on Residential Real Estate - California
More details to this question:
we opened escrow the 1st time, cancel after 7 days with valid reason, deposit was fully returned. 2 weeks later, opened escrow 2nd time, lower price than 1st time. Paid $1000 for appraisal and inspection. After investigations, concern about the neighborhood, cancel again still within 17-day contingency period. Seller wants liquidating damages because we cancel the 2nd time, otherwise want to go to arbitration. So what are the chances that we will get our deposit back, will we have to pay for legal fees if we win. Really appreciate your help.
1 ANSWER
Estate Litigation Attorney serving Redlands, CA
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If you used the standard California Association of Realtors residential purchase agreement form, then you agreed to first go to mediation to settle any dispute between you and the seller. In mediation, each party pays their own attorneys fees. You will not be able to get attorneys fees if you win in arbitration or court unless you go to mediation first. If you agreed to arbitration, then you would next be required to go to arbitrate if you don't settle in mediation. If you didn't agree to arbitration, then you will be in court.
Whether or not you're entitled to the earnest money deposit, depends upon the terms of the purchase agreement, the reasons why you terminated the agreement, and whether or not you properly terminated. You should have an attorney represent you in both the mediation and arbitration and/or court proceeding.
Answered on Sep 09th, 2015 at 9:53 PM