Q: My husband and I our selling our home in Mesa, AZ. We recently had a solid offer that all parties agreed on.
On the day that the buyers were opening escrow, they decided to back out. The reason being given is that our home is in a flight pattern for the local airport.
However, we have a copy of the flight pattern map which is to the south of our house. We have shared this information with the buyer who stated that he already had that information.
I don’t understand how he can back out of a contract for this reason. Is this possible and do we have a right to the earnest money?
A: The answer to your questions depends on what your contract says. If the buyer was not bound to the deal until escrow was opened, the buyer could effectively walk at any time up to that point. If the contract bound the parties to the deal, you may have an action against the buyer. You will need to consult with a real estate attorney on this issue.
Typically, you would be entitled to the earnest money only if you could prove that you’ve been damaged somehow by the buyer’s cancellation of the contract.
For example, if you had to lower the price of your home in order to sell it, those might be “damages.” But if you get another offer tomorrow for the same amount of the contract or more, damages might be harder to prove.
You also must look to the contract to see what reasons the buyer may legally terminate the contract. Unless there is a clause permitting cancellation of the contract due to air traffic flight patterns, you may be able to sue the buyer for your damages or for the earnest money.
Please contact a local real estate attorney who can look and your contract and help you sort through the issues.