AboutTimmy Chou Expertise I am a experienced Mediator and a partner in a management consulting firm. As a mediator I work as a third-party neutral and specialize in partnership/shareholder disputes, management/labor issues, company culture difficulties, and family-owned business problems. I can help describe why alternative dispute resolution may be a good choice for you. As an experienced management consultant I may be able to offer creative ideas to help resolve your organizational and business problems and disputes. "If you say conflict, I say opportunity".
Question Hi there,
My husband and I recently put a contract on a home. Following our inspection that pointed out such issues as taking bars off windows, broken dishwasher, electrical issue, plumbing issue, furnace inspection, we signed an amended contract with the seller, he agreed to remedy all issues by May 8, 2006. We went back with our realtor and personally inspected the home before our closing date, (on May 17, 2006) and found not only that no work had been done, but they had been smoking in the home, and while there, a repairman broke out the basement window. We decided to terminate the contract the next business day. The seller is now saying that we do not get our earnest money back ($1000) PLUS he wants damages to cover his lost mortgage payment (the month he paid prior to closing), and payment for any/all repairs that they had done THAT day (the 17th, when it was to be done the 8th). Our realtor is trying to talk us out of mediation and asking us to just give up the earnest money. I dont' think this is right. Should we proceed with mediation?
Thank you so much, this is all so hard to understand.
Answer Thank you for your question!
Mediators act as neutral third parties to disputes and never "get involved" in judging the merits of conflict, but merely use special techniques to help the parties decide how to negotiate their own settlement. The case you describe here is unfortunately very typical. I am not a lawyer, nor can I mediate your dispute with just you alone but I can respond to your question from my business consulting experience. Note that this issue will almost certainly develop legal implications and you should consult an attorney.
My opinion is that you are being bulldozed. Assuming you have all these items detailed in a contract, it is clear the seller defaulted on the deal. (This, by the way, is why I recommend an escrow agent to hold funds prior to closing) In my experience, even with specific language in a contract, one party to an agreement can merely bulldoze the other party. So the short answer is that the seller can do whatever he wishes and make you compel him to do otherwise--even if it is clearly wrong.
First try to see an attorney. In many states the BAR association operates a service wherein lawyers provide free consultations to people without charge. See if you can get an appointment.
Here is what you can do in the meantime. Begin by documenting all contracts and every instance of meetings. Be sure to document all the parties who were there and be as detailed as possible. Next, you should send a certified letter to the Seller AND TO YOUR REAL ESTATE agent's head office demanding an immediate refund. I am troubled that your agent is not advocating for you in this matter.
Next, find out all the state and local regulatory and trade organizations that may be important to the parties. This list may include:
State Realtors License Board
State Consumer Affairs/Ombudsman
Better Business Bureau
Local Building Department
Local and municipal officials
The press (print and TV)
Send a copy of you letter to the entire list and every other imaginable consumer resource you might have available in your city. Make sure your letters note that you have sent copies to all these people.
The goal here is to get your realtor to realize it will cost allot more to deal with all the collateral damage you will cause them by your willingness to proclaim their nefarious business practices to everyone, and they will just take care of you. Make sure they know you will stop at nothing and you will continue to tell your story to everyone. Your agent has a duty to advocate for you, and therefore, if he is telling you to just walk away from the money HE and HIS COMPANY could be co-defendents in your lawsuit.
You have a perfect case for small claims court so if you have to go to court begin to document, in a chronological way, all these events as they unfold so the judge can see clearly that you have been mistreated.
I wish I had better options for you.
These are some ideas. Feel free to follow up with additional questions.
For your information, the pros and cons of the types of dispute resolution methods follows.
GOOD LUCK!
Arbitration, Mediation, and Litigation
Arbitration: the referral of a dispute to one or more impartial persons for final and binding determination outside of the judicial system
Benefits of Arbitration:
Confidential, no public record
Limited exchange of documentation, information
Quick, don't have to wait for a court date
Arbitrators have expertise in the subject matter and are trained in conflict resolution
Cheaper than litigation
Preserves business relationships
Negatives of Arbitration
It's a compromise, no %100 winner
Complex arbitration can be costly
If not satisfied, may litigate the arbitration procedure
Poor results with an unskilled arbitrator
Both parties must agree to cooperate in the process
Mediation: the process by which parties submit their dispute to a neutral third party (the mediator) who works with the parties to reach a settlement of their dispute.
Benefits of Mediation:
Neutral mediator can objectively suggest alternatives not considered before
Parties are directly engaged in negotiating the settlement
Can be quicker than litigation
Less costly than litigation
Preserves business relationships
85% of American Arbitration Association cases mediated find successful solutions
Negatives of Mediation
may not reach a binding decision
unskilled mediator
Litigation: using the judicial system to resolve disputes
Benefits of litigation:
a clear winner and loser
uses a prescribed set of procedures
more predictable outcomes
is final
Negatives of Litigation:
waiting for court dates can do more harm
usually more expensive than mediation and arbitration
part of the public record
