Real estate contracts are distinctive from just about any other kind of contract due to the fact that, under California law, each bit of real estate is thought to be wholly unique, and unique objects hold their own particular kind of support in contract law. Identified as specific performance, in violations of real estate contracts, the person wronged by the violation is able to ask that the courts order the sale to progress due to the uniqueness of the home.
If you find that you are contemplating joining into a real estate contract, it is essential that you know the legal complexities of specific performance and the ways in which it can impact your real estate negotiations.
Solutions for the Violation of a Real Estate Contract
There are many solutions for the violation of a real estate contract. One possible solution is what is known as money damages, which may be granted if the aggrieved person has been economically hurt by the transaction. Depending on the conditions of the contract violation, the wronged person could only collect money damages for any deposit they paid on the property along with reasonable expenses. If the violation was, however, made in bad faith, then the wronged person may be granted supplementary punitive damages for the violation.
A second solution to a real estate contract violation is the closing of the contract and a repayment of any deposit along with reasonable expenses. This solution is generally given in the event that the contract has yet to be formalized or is determined to be unenforceable and void. The wronged party is usually able to recoup any advance payments that were made towards the fulfillment of the contract for the property, plus reasonable expenses.
The last choice for a violation of a real estate contract is specific performance. If the person who is selling the property is resistant to transferring the real estate over to the purchaser, the purchaser can request that the court compel the sale to progress in accordance with the terms of the contract. Specific performance occurs in the place of monetary damages for the violation, and the deal for the real estate has to proceed as outlined in the contract, with absolutely no alterations or modifications.
Components of Specific Performance
If a court wishes to order specific performance for a violation of contract for real estate, the subsequent components must be proved by the wronged party:
- The uniqueness of the property renders the contract suitable for specific performance
- Sufficient consideration has been given by the wronged person for a fair contract
- Action by the wronged person on the contract
- Violation by the first person via inaction or subterfuge
- An insufficiency among all other solutions, except for specific performance of the contract
If the wronged person is successful in their quest to receive specific performance, then the courts will demand that the contract be executed in accordance with its terms. This denotes that the transaction has to proceed as agreed upon and the wronged person will be allowed to collect any profits or rents that they would have collected had the real estate been sold when it was intended to be sold.
If you have additional questions regarding how specific performance can impact a real estate contract violation, please get in touch with the Leiva Law Firm by calling 818-519-4465. We have an extensive background in helping businesses avoid liability and drawing up precise and enforceable business agreements and contracts. We can help you examine your legal rights in Spanish or in English.