When Can a Buyer Force a Seller To Complete a Real Estate Sale?
In real estate transactions, the enforceability of contracts is a critical issue that often leads to disputes between buyers and sellers. When a seller tries to back out of a signed real estate contract, you may wonder whether you can compel the seller to complete the sale. While in some cases monetary damages may be enough for a buyer, in other situations, completing the agreed-upon transaction is the only way a buyer can be compensated. Understanding when the latter may be appropriate is important.
Enforcing a Real Estate Contract for Specific Performance
The case of Mercado v. Sridhar illustrates when a seller can be compelled to complete a sale. The buyers (Mercado) sought specific performance of a residential real estate contract to purchase a $3.2 million home. Specific performance is an order requiring a party to fulfill their obligation as closely as possible to what was agreed in the contract. It’s a remedy that may be available where money alone would not be enough to compensate the party.
In this case, the sellers contested the contract’s enforceability, arguing that the parties had not reached a mutual agreement on certain addenda regarding the home’s furnishings and a leaseback option. The sellers claimed that, because the unresolved issues were essential to the formation of the contract, the contract was therefore unenforceable.
During the trial, the trial court ruled in favor of the buyers, noting that the Form Agreement, a standard real estate contract approved by the Florida Association of Realtors and the Florida Bar, was a valid and enforceable agreement. Since the Form agreement met all legal requirements for contract formation, including mutual assent and consideration, the addenda were not fundamental to the contract’s enforceability.
The court’s decision highlights several key legal principles:
- A valid contract can exist even if certain terms remain unresolved, as long as the core elements are clear and definite
- Addenda not explicitly included in the Form Agreements do not affect the enforceability of the primary agreement. Both parties have to take the necessary steps to incorporate it.
- A buyer can compel a seller to complete a sale if a valid and enforceable contract exists, even in the absence of agreement on additional terms.
A buyer’s ability to compel a seller to complete a real estate sale depends on whether a valid contract exists. This case emphasizes the importance of clarity and mutual agreement on essential terms in real estate transactions. If you are a seller, you should be aware of the legal implications of challenging enforceability due to unresolved issues, as the court may uphold agreements that appear valid.
Before signing an agreement, consider whether you need certain conditions to protect your interests. Once those conditions are waived, the agreement is considered valid, and the party that fails to close the transaction may incur losses and damages and, as we have seen in this case, face a claim for specific performance.
Contact Us for Legal Help
If you are involved in a real estate dispute in Florida, contact our Miami real estate litigation lawyer at Valero Law today by calling 305-607-7011 to evaluate the contract and explain your legal options. We serve clients in Davie, Coconut Grove, Broward County, and Miami-Dade County.
Source:
scholar.google.com/scholar_case?case=3264144717356022232&q=uis+R.+Mercado+and+Chanttel+Mercado+(Sellers)+v.+Jayanth+Sridhar+and+Nika+Bagheri+(Buyers)&hl=en&as_sdt=4,10
