Expert: Karyn Foley - 6/1/2006

Question
I am under contract to sell my house and I need to terminate the contract for personal reasons. We are several weeks from closing - the buyer has had the home inspection done, but to my knowledge that is the only additional cost incurred.

I feel the need to clear this up with a minimum of hurt feelings and animosity. I am more than willing to give back all earnest money, and part of me says I should make it right by paying for the house inspection as well. I have received the full copy of the inspection and feel I will benefit from it thus I should reimburse the buyer for the inspection.

Could the buyer, their agent, or my agent come back and sue me for anything beyond this? Conceivably what could their damages actually be? Advertising costs?

Thanks inadvance

Jim

Answer
Dear Jim:  You are in a legally binding contract.  Without seeing the document, I can only surmise that you have met your obligations thus far and that the buyer has met the buyer's obligations.  Ask your agent if there is any clause or contingency still remaining.  If so, then perhaps you or the buyer can not agree and either one may be able to cancel if an agreement cannot be reached. However, either party may agree to continue even if a request is not met.  I am not an attorney and cannot practice law without a license so I cannot give you legal advice.  Sit down with your agent and see if this can be resolved with the other party and if they will cancel if you do may reimbursement.  However, the contract may state that you would owe a commission to the agents should you back out.  Plus, the buyer may well be in the position to go forward with a lawsuit of specific performance which can best be explained by your agent or an attorney.  The buyer to do this would probably be able to file a lien not allowing you to sell while a suit is in progress where the buyer goes forward demanding that you fulfill your commitment by selling.  All of the above are possible scenarios but again you should consult an attorney.  I have seen a buyer be very understanding and cooperative if the seller's reasons are truly valid and I have also seen a seller being forced to proceed with the contract.  Contracts are to be entered into with the goal of living up to the letter of the contract unless mutually agreed to otherwise.  To back out dowh may be more problems that they are worth.  Perhaps you could extend the contract by mutual agreement for a period while you work out your problems.  Again, you need to sit down with everyone involved and then consult an attorney if the buyer is not in agreement.  Please let me know what happens and if you have any additional thoughts on this issue.  Karyn Foley