Expert: Karyn Foley - 8/11/2006

Question
Dear Karyn,

About a year ago, I put down earnest money to reserve a condo that was to be delivered on April 30, 2006 or within 90 days of that delivery date per contract. The contract also says the seller has the right "from time to time by notice to the other party to extend the closing for up to two (2) extension periods of up to sixty (60) days for each extension period."

Well, 90 days came and went (July 30, 2006). Subsequentely, I received a notice in the mail stating that the delivery date would now be October 26, 2006, which is another 90 days after the first 90 days.  My interpretation of this extension was that they had then exhausted both extension periods and thus any further delays would result in default.  Early this August of 2006, I received yet another notice stating the delivery would now be pushed back another 30 days to November 26, 2006.  

So, basically, while they've used a total of 120 days since the first 90 days passed, since the first extension was 90 days, my belief is that they've violated the contract and now we can default.  They're continuous delays have actually cost me thousands of dollars and a lot of grief over what to do in the interim period.  At this point, I'm very likely to just back out of the contract (legally) if we can default.  Am I allowed to under the provision I quoted above?

I really appreciate your help on this frustrating matter.

Answer
Dear Stephen:  I cannot "pratice law without a license", which means that for legal advice you should contact an attorney.  However, maybe I can shed some helpful light on the situation.  As you probably know, it is difficult, if not impossible, to forecast an exact time a home will be completed.  There are always delays in obtaining materials, and many times the necessary materials have to be ordered, and if they are back-ordered the delays could depend on more than one party.  Plus, weather always plays a part, as does the reliability of the subcontractors.  The main question you should ask yourself is if you still want the house or not.  If you still want the house, then you are going to have to deal with the time element, knowing you will get what you want and it may be worth the wait.  I do not understand why you are out thousands of dollars.  If you are in a rental, can you not move to a cheaper rental in the meantime?  Even if you bought another house, there could still be a time elememt.  Sometimes you purchase a home that you later withdraw from in the event the home inspection did not meet with your satisfaction; then you have to start the process all over again with another home.  Unfortunately, nothing is perfect and these time periods are something uncomfortable and difficult, but they do happen regularly. Now, if you do not really want to proceed with this particular property, you should sit down with the builder and let the builder know you with to withdraw from your agreement, and see if he will allow you to do so without any penalty.  Maybe the builder would be agreeable, thinking he has a good property now back in his hands that he may be able to sell for more money to the next buyer.  Or, perhaps you could compromise, and you might be out some money but consider it a savings from the sum you may still have cost you if you continued in the transaction.  If you cannot reach a resolution, then you just may have to bite the bullet and have an initial visit with an attorneywho can tell you what is legal in your area, and how he or she can help get you out of the deal.  Now, what this attorney may charge for acting in your stead and in your behalf, may cost you as much as losing some of your deposit or as much as more delays would cost you.  But, at least by then you should be able to have the answers and the costs and then make a rational, business-like decision.  I understand how frustrating and emotional this can be, and I am so sorry you are goig through this grief and uncertainty.  Please let me know what happens and what you decide to do, and good luck in the process!  Karyn Foley