Legal Question in Real Estate Law in California

Re: Seller fails to close on time

Follow Mr. Whipple's advice.

If you do not understand his answer #4, what he means is that in agreeing to buy house, you also decided to move out of your present residence. The seller's delays were not the reason for terminating the lease, his agreeing to sell you the house was. So if you decide to elect to treat it as a breach of the contract of a fundamental element of the contract [i.e., the date of completion of the sale is important], then you might be able to include the $2,000 you paid as part of your damages as then the damages are not caused by his delays but by his agreeing to sell the property to you and then failing to sell it, knowing [or reasonably should have known]that you would give notice at your current residence and that that might require a breach of your lease agreement.

Re: Seller fails to close on time

Two pretty standard responses provide most of the needed response here:

First: Ask your real estate agent who is representing you. They don't cost you anything to employ, while lawyers do....and agents should be familiar with forms that are in everyday use in residential sales deals, such as the "Notice to Perform" which, I believe, is the first step in telling the other party that they are in at least minor breach of an agreement.

Second standardized response: Read your contract. It will tell you, among other things, whether you can sue for breach or must first ask for mediation and/or arbitration, and whether the losing party has to pay the prevailing party's lawyer bills.

Answers to specific questions:

(1) If the purchase agreement has a "time is of the essence" clause, and most do, and you have complied with any "notice to perform" requirement contained in the contract by giving the seller the required notice, I'd say after the passage of a few days in which no corrective action is taken by the seller, you're out of contract. It would be so much better for you to have your own (buyer's) broker.

2. What actions can you take to "force" the seller to close on the 20th? There's nothing I know of; not even a TRO is likely to work; you pretty much have to rely on coercion such as reminding the seller he/she will be liable to you for damages if the deal doesn't close promptly. That should work, but often it doesn't.

3. The seller's agent may truly be in the dark, or may be too lazy to investigate, or not very bright, or some combination of the above. In any event, the seller's agent owes only limited duties and loyalty to you; that's another reason you should have your own. I'd just keep nagging the seller's agent, or bypass the agent and go to the broker, or contact the seller directly.

4. You are probably entitled to recover money damages for some of your losses, but I think the $2,000 is doubtful because the necessity to buy your way out of an existing lease was not caused by the seller's conduct. Again, review the purchase agreement for the mediation, arbitration and attorney fee provisions, if any.