Can a seller refuses to sign cancelation of escrow even if I give up my deposit?
5 attorney answers
People can and often do take actions which may violate legal obligations. The seller apparently is refusing to sign a cancellation, whether that is or is not legally appropriate. Consequently, you need to consider your legal options. Here are some things to consider: (a) The standard California Association of Realtors (CAR) contract specifies a time to remove your contingencies to cancel the transaction. However, the CAR contract generally specifies that your contingencies remain in effect beyond the specified time until you remove them; (b) The contingencies in the CAR contract go beyond inspection of the structure itself. A buyer may find undesirable information about the neighborhood, nearby earthquake fault lines, or other issues near the property that justify cancellation; (c) Whether the seller is entitled to keep your deposit or sue you for damages beyond the deposit amount depends upon whether you breached the contract and whether both parties agreed to the liquidated damages provision which is an optional part of the CAR contract; (d) If you did not remove the contingencies, you might be entitled to withdraw your offer to forfeit the deposit and demand return of the deposit; (e) If a seller unreasonably withholds a deposit, a buyer may be able to enforce a lien against the property under Civil Code section 3050, though this may not be worthwhile or practical if the deposit is small.
Details regarding your legal rights should be gleaned from a detailed review the contract, escrow instructions, and transaction documents.
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You posted about this previously. If they won't cancel and you don't care about the $5000, just walk away.
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The State of New York has no such prohibition from entering into another transaction which has been terminated. However, the first contract may subject a defaulting purchaser for certain liquidated damages that exceed the contract deposit, which may account for the Seller's reluctance or unwillingness to consent to the cancellation of the contract. You must have your attorney explain your liability and consequences should you willfully default under the terms of the contract.
If the Seller believes you did not have the right to cancel and thinks he is entitled to other damages against you, that may be why he is refusing to sign, since he won't get your deposit if he doesn't sign.This is dependent on the contract language what your rights to cancel are, and what you are responsible for if you do. . I would probably want to explore the Seller's position to make sure it doesn't have any legal weight against you. There is an escrow cancellation fee which you may be responsible for and which you may be not addressing. I would be very sure of your position legally before you do enter into another purchase contract.
The foregoing is for informational purposes only and may not be relied on as attorney-client advice.