I had a contract selling my land. Closing date was Nov. 9th. Still haven't closed or extended the contract. Can I sue for specific?

Asked by Laura Allen Pieper, Nolan County, TX Wed Jan 5, 2011

performance? The buyer has repeated made promises that closing would be 'next" week, then promised to close by the end of November. He has entertained the idea to sign a extension but now, he won't answer the realtors phone calls...What he is doing is resaleing my property but apparently, hasn't found a buyer. He has my property listed on the internet as if he owns it. He has even said he owned it when I had a friend call and see if he would answer the phone. We were told to get all our animals, etc off the property before closing, so we did....and here we sit. There is alot of land involved and was my family business, now I am stuck with bills to pay and no income because of what we were told to do...What he did is wrong and I would like to know if I have any legal rights to sue him for...specific performance??

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Stephen McCl…, Agent, Georgetown, TX
Wed Jan 5, 2011
Good day to you.

If you are going to take a legal route i.e., specific performance, then GET AN ATTORNEY.

Otherwise your situation is this:

The original contract is in default. I would make a decision around these criteria:

1. Agree to extend the closing date on the current contract under the same terms: I recommend requiring additional non-refundable earnest money.

2. Require a new contract with the existing buyer but with tighter language/conditions and requiring more earnest money separate from what you have already retained on the opriginal contract.

2. Terminate the contract under the default: You are entitled to keep any /all earnest money. Find a new buyer.

3. Sue for specific performance: Will cost you in the long run and probably is not worth the time.

4. Agree to extend the current offer but under the agreement you place the property back on the market and continue to market it yourself in hopes of finding another buyer. Give current buyer 1st right of refusal. Still require more earnest money.

Good luck to you.

Stephen B. McClain
Broker /Owner
Cornestone New Home Solutions
512 876-3116
1 vote
Anna M Brocco, Agent, Williston Park, NY
Wed Jan 5, 2011
Since you are asking a legal question, it's best to consult with an attorney who specilaizes in real estate, have all paperwork reviewed and see exactly what options you may have--he/she can best advise as it relates to your specific situation--most professsionals do offer a free consultation.
1 vote
., , Austin, TX
Fri Jan 7, 2011
Suits to enforce specific performance are very lengthy and costly. Write a letter of demand to the title company requesting the buyer's earnest money be remitted to you in full. Most likely, the title company will not release it unless it has the buyer's signature, which will never happen. Ensure that the title company does indeed have receipt of the earnest money in hard funds (in other words, the buyer's check cleared the title company's bank).

If two brokers are involved, one for your side and one for the buyer's side, then call the buyer's broker and threaten to lodge a complaint against their license with TREC and Nolan County Board of Realtors. If you have a broker on your side, then do the same, but speak less severely.

You might also consider trying to get the earnest money from a small claims court in Nolan County -- the filing fee is about $55 -- as long as the earnest money amount was under $5K.

Call real estate attorney, Leon Pope, in Austin, or a local real estate attorney in your area. Deal only with experienced real estate attorneys, no other type will do.

Take care,

Mary Strickler
Realtor GRI
Prudential - Austin
0 votes
Betina Forem…, Agent, Austin, TX
Thu Jan 6, 2011
Dear Lpieper,
You should be asking for advice or representation from a real estate lawyer, not Realtors. Realtors are not qualified to answer your legal questions. We do take Ethics and Legal Update each year, but we are NOT lawyers. There are several real estate lawyers in Austin that could help you. If I were in your situtation I would call John Hay III the principal of Hay Compere and get some qualified advice or representation. Tou may find their contact information on their website: http://www.haycompere.com/thefirm

I wish you the best for a speedy and satisfactory resolution to you situation.


Betina Foreman - Realtor
0 votes
Bill Austin, Agent, Austin, TX
Wed Jan 5, 2011
It is amazing to me the questions asked in a forum like this.
Seriously, such an important problem and you post to an Internet forum.
I see no mention of what your Realtor has advised, do yo have a Realtor representing you?

I gues free "comments" are a good substitute.

0 votes
Bill Ley, , Austin, TX
Wed Jan 5, 2011
This is a legal question. But, I'm a lawyer. So, here you go, bearing in mind no attorney-client relationship exists here, and this in not legal advice:

Basically, it depends on why it has failed to close, and that isn't clear from your question. If you came for the closing, and the buyer just didn't show up, and assuming no collateral agreements or understandings, and assuming no uncontrollable circumstances (e.g., the house burned down) then yes, technically you can sue for specific performance.

But, when a closing fails it’s usually not because the buyer forgot or changed his mind. It’s usually a problem with the financing. If you used the standard Texas Real Estate Commission sales contract (which you probably did) and if the transaction failed to close because the buyer's bank failed to approve the property in time, then you can not sue for specific performance. That's because the TREC form says the buyer does not have to close if the property doesn’t meet the lender's standards. And the buyer doesn’t have to let you know that before closing. The deal is just dead, and you don’t know it. (That's if the PROPERETY doesn't meet the lender standards. Which is different from the BUYER’S CREDIT not meeting the lender's standards - that he does have to tell you about, and the contract specifies the deadline.)

But, you reeeeally don't want a lawsuit. And specific performance is a very tough one. That’s why you hardly ever see one. And if you won, does this buyer have the money, even if the judge orders him to closing? If you threatened him with contempt of court and jail if he fails to close, could he write the check? Probably not.

Your best course is to ask the title company to hand over his earnest money. Not the deal you thought you had, but better than nothing. If the buyer refuses to release the money from the title company, then you probably should sue the title company. This is called an “interpleader” law suit. It's a much easier lawsuit than specific performance. The title company writes the check to the court, and you and the buyer get to convince to the judge who he should give it to. The buyer can’t get it with a sob story. He has to point out a specific contract reason for not closing. Depending on the amount, you might be able to handle this without a lawyer.

Good luck.
Web Reference:  http://BlackSheepRealty.com
0 votes
Scott Butcher, , Austin, TX
Wed Jan 5, 2011

You had some very good recommendations below. Attached is a link to an attorney I've used on land purchases in the past and he's very good. http://weichertlaw.com/team/glenn-k-weichert/. Feel free to contact Glenn directly and use my name.

Odds are that your current Buyer does not have the capital and is merely trying to 'flip' your property OR syndicate the deal, which means raise equity from others in order to buy your land but simply can't raise the equity in time.

Since he's not acting in good faith with you, I'd cancel the contact, claim your earnest money and put your animals back on the property and put a 'for sale' sign back ont he property if you want since he is in default.

I would have an attorney draft your termination letter and have them send the request for earnest money being released back to you. Title Companies are much more quick to respond to an Attorney's letterhead than to yours.

Next time around, I would seet your earnest money expectation MUCH higher (say 10%) to see if the next buyer is real or not. If they are real, then they will have no problem putting down a higher amount of earnest money. If they balk at the notion, then that tells you something about their ability to close.

Good luck!
0 votes
Richie Ghazn…, , Torrance, CA
Wed Jan 5, 2011
Your best shot will be to get A real estate attorney. Mean while have your Real estate agent get contract terminated.
0 votes
Cynthia Bell, Agent, Cedar Park, TX
Wed Jan 5, 2011
I agree, get your documents together and contact a real estate attorney.

Laura Fowler is local and can assist you. Her link is below.
0 votes
Susan Geick, , Austin, TX
Wed Jan 5, 2011
Contact an attorney. If you are out of contract and want to move on ....your Realtor can send a letter treminating the contract as a formality. Or figure out another way to "work with" your buyer.
Good luck! These situations are difficult. May be time to move on.
0 votes
Nadine Cius, Agent, Houston, TX
Wed Jan 5, 2011
I agree with the all the answers. It is best ot consult an attorney concerning your rights to sue. Additionally, you should contact the websites he is advertising your property on, and request for them to remove it because he is not the legal owner. Most websites will comply.
0 votes
Guy Gimenez, Agent, Austin, TX
Wed Jan 5, 2011
1. When dealing with real property, verbal promises have the same value as pixie dust. It means nothing if it's not in writing.

2. You should have included in your current, and most certainly want to include in any future contract, that the contract is non-assignable. This will only prevent him from "assigning" his contract to another party...it won't keep him from trying to flip the land.

3. Also include a "time is of the essence" provision. This requires time frames in a contract be strictly adhered to.

4. You'll have to consult with legal counsel regarding litigation, but you stated you don't have income that you previously had. Litigating with no cash reserves is a recipe for disaster. I spent thousands on my last lawsuit and it took almost 2 years. I prevailed, but don't kid yourself, it ain't fun.

5. Seek legal counsel to ensure the buyer is in default and then seek the remedies available in your contract. Your chances of having a court "force" someone to purchase your land are slim and none, so find alternatives available in your contract.
Web Reference:  http://www.phgbrokers.com
0 votes
Sean Williams, Agent, Lawrence, KS
Wed Jan 5, 2011
You are asking questions of Realtors that should be answered by lawyers. I recommend you contact legal counsel.
0 votes
Charles Runn…, Agent, Austin, TX
Wed Jan 5, 2011
You really should consult an attorney, but if you're out of contract, you should be able to keep the Earnest/Option money and move on with your life.
0 votes
Cindy Crawfo…, Agent, Round Rock, TX
Wed Jan 5, 2011
I agree that you need to consult with an attorney on this issue. The reason I am responding is because I have buyers who are looking for opportunities to develop land for a subdivision. If you do terminate the original contract, and this land is suitable for that kind of development, have your Realtor contact me.

Cindy Crawford, REALTOR
Keller Williams Realty
101 Old Settlers Blvd #190
Round Rock, TX 78664
(512)217-8990 Phone
(512)579-4241 efax
0 votes
Phillip Baird, Agent, Austin, TX
Wed Jan 5, 2011
Do yourself a favor, consult with an attorney. I know a good real estate attorney. His name is Karl Moeller email address: LawKHM@aol.com
Phone: 512-320-9120
Tell him Phillip Baird sent you.
Good luck!
0 votes
Bruce Lynn, Agent, Coppell, TX
Wed Jan 5, 2011
Best to consult an attorney.
The biggst question for you and for your attorney is does the person have money?
If yes, then maybe you will get some cash.
If no, then what's the use of lawsuit?

I think it is hard to force a buyer to perform. Easier to force a seller.
Probably better to keep their earnest money, terminate and move on to the next buyer.
Web Reference:  http://www.teamlynn.com
0 votes
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