The Thunder Bay Chronicle-Journal
City News, Friday, February 25, 2011
Scorned seller seeks recourse
by Les Vandor
Q: WE had a cottage for sale (no real estate agents involved) and received an offer from one party (Buyer A). We did not accept it immediately because we had a showing with another party (Buyer B) the next day.
Buyer B, aware of the previous offer, made a higher offer, exceeding Buyer A by $12,000.
We verbally agreed with Buyer B to accept the offer. A short time later Buyer B gave us a formal signed Offer to Purchase. We counter-signed it and dropped it off at his lawyer's office. No deposit was received despite our agreeing that it would be $10,000.
Several days passed and I contacted Buyer B regularly requesting his deposit. He assured us that he was reputable, dropped several names (with whom I followed up) and was very quick to point out he was a university professor (teaching ethics), apparently to bolster his credibility and therefore his trustworthiness.
We proceeded with all that you do in preparation for a sale. We cleaned and moved our belongings.
The closing date approached and still there was no deposit. I assumed his lawyer was in the process of searching title.
A week before the agreed upon closing date, a voice mail was left by Buyer B advising us that he "was out."
No explanation and no response to my calls.
We contacted Buyer A. Unfortunately they had just put an offer in on another property. Ouch!!!
Our property did not sell for many months, and over this time we continued to incur the expense - taxes, utilities, for example - of owning the property.
Is there any recourse against Buyer B in small claims court?
Signed: B.R.
A: IF indeed you had a signed agreement, then you can sue Buyer B.
A deposit makes it easier to collect your losses, but not having a deposit does not preclude a suit.
You do however need to know why Buyer B backed out. There may have been a legitimate reason such as a problem with your title.
Before you start a lawsuit, it may be prudent to contact Buyer B's lawyer or at least put his client on notice that you intend to sue. That will get a reaction.
Had you not sold, you could have forced a sale to Buyer B by way of a special lawsuit forcing him to buy. Given that you now have sold, you can however sue him for your added costs and any difference in price between what he agreed to and what you subsequently got.
Les Vandor's column appears each Monday. Send your questions to lesvandor@gmail.com. These answers serve as a guide and you are always encouraged to consult a professional. All emails will be answered.
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