Does serving a mediation letter to seller start the clock on the statute of limitations? If not, can we file suit immediately?

You should have a California lawyer evaluate your case immediately. If you were fraudulently induced to enter into the contract, you may not be bound by the contract at all, including the obligation to mediate and to arbitrate. Don't try to do this yourself. The issues you are describing are complicated and you need the counsel of a competent litigator.

I'm not licensed in California so don't take what I say here as legal advice. It's simply information based on general principles of law which is intended to educate. If you need legal advice, please consult a lawyer who holds California licensure.

Good luck.

In CA, you 4 years to sue on breach of a written contract, and 3 years to sue for fraud, either to rescind (cancel) the contract, or to get damages because of the fraud. Fraud requires a material factual mispresentation that you reasonably relied on to your damage.

Depending on how your contract reads, you may have to go through with the mediation, but you should give the sellers a firm deadline to agree on mediation and another deadline to complete it, and then you have until 12/10 to sue. If for some reason you start to run out of time, you can also get the sellers to agree to toll the statute to give you more time to sue.

As this transaction is governed by the contract you signed, and you've provided no details about the alleged fraud or damages you're suffered, no one can advise you of your specific rights and remedies without reviewing your contract and getting full disclosure about the fraud and other circumstances surrounding this transaction. You should hire a real estate litigator to help you with this --this is not a do-it-yourself project.

Disclaimer: Please note that this answer does not constitute legal advice, and should not be relied on, since each state has different laws, each situation is fact specific, and it is impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue. This answer does not create an attorney-client relationship.

Under the standard California Association of Realtors Purchase and Sale Agreement, you have to offer mediation to preserve your right to attorneys' fees. If they don't agree, you can demand arbitration if both you and they initialed the arbitration provision. I do not know if the seller's agent has any liability under Section 1102, but you may want to file suit against them to protect the statute of limitations or ask them to join in the mediation and arbitration.

The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than the educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question. To the extent additional or different facts exist, the response might possibly change.