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ScottyMacESQ
ScottyMacESQ, Lawyer
Category: Real Estate Law
Satisfied Customers: 11898
Experience:  Licensed General Practice Attorney, Texas
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can a seller back out of a real estate closing. I have a partner

Customer Question

can a seller back out of a real estate closing. I have a partner and we cant agree on the division of proceeds. we signed a preliminary form. the real estate agent said its not binding
Submitted: 1 year ago.
Category: Real Estate Law
Expert:  ScottyMacESQ replied 1 year ago.

ScottyMacESQ :

Thank you for using JustAnswer. I am researching your issue and will respond shortly.

ScottyMacESQ :

What specifically does the preliminary form say? I assume that you're selling it (since you're talking about the division of the proceeds, correct)?

Customer:

yes

ScottyMacESQ :

And what specifically does the preliminary form say?

Customer:

I think it is a standard form dicussing price and piliminary closing date and commission %

ScottyMacESQ :

Is there an agreement for you to sell and the buyer to buy? And was it signed by the buyer?

ScottyMacESQ :

Why would it be a "preliminary" form? Was there going to be another contract signed?

Customer:

If I dont show at the closing and just come up with a reason to pospone it that should not cause a problem should it?

ScottyMacESQ :

Did you see my follow up questions?

ScottyMacESQ :


Is there an agreement for you to sell and the buyer to buy? And was it signed by the buyer? Why would it be a "preliminary" form? Was there going to be another contract signed?



Customer:

yes at the actual closing. It did not have the fees for the inspections and back taxes yet

ScottyMacESQ :

it's hard to say whether or not this preliminary form is an actual contract to sell. you can look at the title of the form, and see if there's definite language regarding your obligations to the buyer. If you, as the seller agree to sell, for a certain price, at a certain time, to the buyer, the property, then it's pretty clear that it is a binding contract.

ScottyMacESQ :

now if there are material terms such as the price of the property or the date of delivery, that would be something where it might not be up valid contract. Furthermore, there might be an exit clause or contingency that has to first be met before and a valid and binding contract, but that would be in the contract itself.

ScottyMacESQ :

By the way, I apologize for any errors in this answer. I am using a voice recognition program, and while it is accurate most of the time, is not 100% accurate, so if there's something that doesn't look quite right, or appears out of place or not grammatically correct, the reason is likely the software that I'm using. If will try to catch any errors, but if if you need clarification at the end, please let me know.

ScottyMacESQ :

if there are material terms that are not stated, then it would not be a binding contract is what I meant to say.

Customer:

do I have any options and what can they realisticlly get from me. I also hve a witness that was there when I signed it and she said it was not binding

Customer:

But I did not read it word for word and took her word for it

ScottyMacESQ :

The wording of the contract itself will control over contrary spoken statements. So if it's a binding contract, the statement that it is not binding would have no merit. A court is going to presume that you have read and understood any contract that you sign.

ScottyMacESQ :

If it's a valid binding contract, a buyer can take you to court and attempt to compel "specific performance" (that is, have the court order that you transfer the property to the buyer). This is the situation when the item contracted for is unique (such as real estate, as opposed to something mass produced, like a vehicle). If the buyer breaches, typically the contract allows for liquidated damages (money) because buyers are pretty much interchangeable, and not unique, per se. A court can't compel someone to buy a property. But when a seller breaches a contract, the court can compel the sale to go forward by the doctrine of "specific performance".


ScottyMacEsq : Assuming it's a valid contract (which I would not have any reason to believe that it would not be) you could only get out of it with the consent of the buyers OR if there's a specific exit clause in the contract itself. Note that an offer that you accept by signing is a contract, it's no longer an "offer". Now you could breach this contract, indicating that you're not going to sell it after all.

There is no "right of rescission" (a time period in which either party can rescind the contract without recourse) in either state or Federal statutes. It's possible that there could be one in your specific contract, but most of the time there is not such a right.

Ultimately if you breach, the buyer can sue you for breach, and could have the option of liquidated damages (if designated in your contract) or specific performance, to compel you to transfer the property.
ScottyMacESQ :

Hope that clears things up a bit. If you have any other questions, please let me know. If not, and you have not yet, please rate my answer AND press the "submit" button, if applicable. Please note that I don't get any credit for my answer unless and until you rate it a 3, 4, 5 (good or better). Thank you, XXXXX XXXXX luck to you!

Customer:

could you give me a quick call at XXX-XXX-XXXX I have two quick questions

ScottyMacESQ :

I'm sorry I cannot contact you off this site (per JustAnswer terms of service).

ScottyMacESQ :

(I have contractual obligations that say I will only talk with customers on this site)

ScottyMacESQ :

(as much as I wish I could, as I understand speaking with someone is often easier than typing)

Customer:

No problem. I dont think they can do anyting to me if I come up with an reason I cant make the closing and delay the closing this would be beneficial

ScottyMacESQ :

Again, it would depend on the actual terms of the contract, but if that's the case in your contract, then that's what it is.

ScottyMacESQ :

Did you have any other questions before you rate this answer?

Customer:

Thanks

ScottyMacESQ, Lawyer
Category: Real Estate Law
Satisfied Customers: 11898
Experience: Licensed General Practice Attorney, Texas
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