What are remedies available for a seller or lessor of property that is real estate to a purchaser
or lessee
to start with the sale or lease of property is subject to contract that it is governed by principles
of contract law. So when one party to a contract does not live up to their obligations
the other party generally has the ability to bring a legal action against the other party for breach of contract
Now, when you bring that action, you're asking the court to remedy the situation by providing some sort
of compensation or other requested remedy because of the breach
Now, in this scenario, we have a seller selling real property or land to a purchaser or buyer
or you have a lesser leasing the use or right to use property in a certain way to a less c All right
Now, what happens when the purchaser or the lessee does not live up to their obligations under the contract
But we have to look first at the agreement. What are the obligations of the purchaser or the lessee
The primary obligations of a purchaser are to provide the money to purchase the property
Okay, That's a very finite obligation that ends unless he has longer uh term obligations that take place or happen over
the term of the lease. One is certainly the payment of rent. Other could be to protect the property and not cause damage to it
over the term of the lease
with that being said. In either case, if you have what's called a material breach
The failure to do? A primary obligation under the agreement, such as paying the purchase price or paying the rent or lease amount
then you have a material breach. Now, a non material breach would be something small
something perhaps procedural, that doesn't ruin the whole agreement, but is in some way not in conformity with what the agreement said
Usually you can only seek judicial remedy for a material breach. Non material breach may
be subject to a separate action for compensation or offset of a specific amount owed or something like that
But we're focusing on judicial remedies for a material or serious breach of the agreement
So the remedies that you can ask the court to order or enforce are as follows
Number one specific performance, you can ask the court to order the other party to
carry out their obligations under the agreement, which would be in a case to actually purchase the land or to continue to lease the property
Well, oftentimes this might not be possible. Right. And generally a court will only award specific performance in very rare circumstances where
otherwise the harmed party, the party who did not breach their agreement um when there is monetary compensation
or an award that would make them whole. Again, that would restore their rights
So usually what you're asking for under the agreement is monetary damages
That is the losses that you suffered because the other side did not live up to their obligation in the cell of property that may
be calculated as the value of the property on the market or to when selling it to another party after the breach
The difference between what the buyer was going to pay and the value of the property
because by having to sell to another person, you four went that amount
so you suffered that as damages, right
With a lessor or lessee relationship, it may be the amount of money you would have received on that lease that you no longer are
going to receive because the lessee is breaking the lease right. Oftentimes
this is recuperating in in various ways with a lessee oftentimes the forfeiture of the escrow amount or the
deposit as we call it right when a purchaser is going to purchase property
they oftentimes put money in an escrow account, which an escrow is a third party who holds money on behalf of others
Okay? And the purpose of that is in the event of a breach
where the purchaser does not live up to their obligations, then that amount of money is forfeited to the seller
Also. Similarly, with a less or less the arrangement, the lessee oftentimes puts down a security deposit in the event
the lessee does not live up to their obligation to not damage or harm the property or fails to pay the due lease or rent
amount, then the landlord can recover that from the deposit or escrow amount
So these are primary provisions and then once again, in the event that the purchaser has
for some reason already moved into the property or the lessee uh is still in the property and has not left
Then the seller or landlord could bring a judicial action asking for eviction of those individuals from the property so
that they could reclaim the property themselves and sell it or release it or do whatever it is they wish to do with it
So these are the primary remedies that exist for the seller or lessor of real property