The details of your contract may stipulate a number of things related to the timeframe allocated to your contingency, whether the Earnest Money was refundable, etc. Those details ought to be reviewed by your attorney. I am just a Real Estate Broker and am not permitted to provide legal advice.

However, this issue is covered quite explicitly in the Indiana Real Estate License Law:

876 IAC 1-1-23 Written offers to purchase; disposition of money received Authority: IC 25-34.1-2-5 Affected: IC 25-34.1-2-5

(b) Upon being notified that one (1) or more parties to an offer to purchase intend not to perform, the listing or selling principal broker, holding the earnest money, may release the earnest money deposit as provided in the offer to purchase or, if no provision is made in the offer to purchase, the selling or listing principal, holding the earnest money, may initiate the release process.

The release process shall require the selling or listing principal broker to notify all parties at their last known address by certified mail that the earnest money deposit shall be distributed to the parties specified in the letter unless:
(1) all parties enter into a mutual release; or
(2) one (1) or more of the parties initiate litigation; within sixty (60) days of the mailing date of the certified letter. If neither the buyer nor the seller initiates litigation or enters into a written release within sixty (60) days of the mailing date of the certified letter, the broker may release the earnest money deposit to the party identified in the certified letter.

(Indiana Real Estate Commission; Rule 24; filed Sep 28, 1977, 4:30 p.m.: Rules and Regs. 1978, p. 800; filed Dec 11, 1986, 10:40 a.m.: 10 IR 878; readopted filed Jun 29, 2001, 9:56 a.m.: 24 IR 3824; filed Aug 15, 2001, 9:50 a.m.: 25 IR 102; filed Oct 28, 2002, 12:01 p.m.: 26 IR 789; filed Jan 27, 2006, 10:45 a.m.: 29 IR 1931; readopted filed Jul 19, 2007, 12:57 p.m.: 20070808-IR-876070067RFA)

Good luck!

Joe Shoemaker
Principal Broker, REALTOR®
MacDuff Realty Group
joe@macduffrealty.com
317 413.8501

I'm not an attorney or trying to practice law here. As always, seek legal advice from an attorney. Here is my experience as an agent: The listing company is holding the earnest money as required by law. They really don't have any dog in this hunt other than abiding by earnest money statutes set forth in state law. I have had clients with earnest money disputes exactly as you have described. Seller feels he is entitled to it from my buyer. I have also had my sellers request to keep it from the listing side. In both cases, the real estate company cannot release it until both parties have agreed. They are doing what is required by law. So where to next? Small claims court was the option in all cases I have been involved with.The amount of disputed money falls under their juristiction and it reqiuires only a small filing fee. You are at liberty to have an attorney, but I have found the process very friendly and not intimidating. I have personally been through small claims for landlord/tennant disputes/.collections/evictions and have found in every instance, the judge was sympathetic with all parties lack of understanding when it came to law. He/she basically broke things down into laymans terms for all parties. My understanding is that you can't force the listing company to release it. You must force the seller to sign off on the release. It sounds like you have your contingency covered and would be entitled to your funds back. You might be entitled to recover your filing fee and expenses back as well. Ken Fishers advice of filing an injunction to prevent the property from being sold sounds like a good tactic as it would tie the seller up and prevent him from doing anything with the property. At that point one would ask if it was worth fighting over $2,000 when you need to start paying attorney fees to defend yourself. If your contingencies are covered, his attorney would probably tell his client to release it since he would probably loose. Just make sure you did not break any other contingencies that may be in your contract. You would probably incur fees while hireing an attorney to do this, which you would be able to recover through court, but then you would need to go collect on your judgement. I have found that process was too much time. Small claims was less than $50 bucks and a pretty simple process. Again, this is just my experience. Always seek legal advice from attorneys.

Your real estate agent should be able to take car of this for you. The earnest money is held by the real estate broker, not the seller. I'd suggest you talk with your agent/broker, so you know what options you have. Good luck.

Laura

Contact your favorite attorney and take action against the C21 office, the principal broker, the agent and the seller. Your purchase agreement should have covered you for this event ... mine always do provide that coverage ... a contingency is a contingency. I would also ask for considerable damages. Take your case to Superior Court to give it some teeth ... have your attorney file an injunction to prevent the owner from selling the vacant land to anyone during the course of the legal action. By the way, I am not an attorney, but I do know the lawn. If you want assistance in the future to purchase other property, please visit http://www.KenFisherOnline.com. We have the experience to prevent such problems from ever occuring.