NYC Real Estate Breach of Contract Attorney

Breaches of real estate contracts can lead to time-consuming legal battles. But hiring an experienced attorney can give your case an advantage and help prevent longer legal proceedings, whether you are a buyer or a seller. Our contract attorneys can represent you in contract claims through negotiation or litigation.

Richman Law Firm PLLC has a consistent track record handling breach of contract disputes. Our lawyers act as strategic partners, providing preventive legal advice and personalized assistance tailored to your needs. Contact us today for a free consultation.

Material vs. Immaterial Breaches

In contract law, there are two types of breaches. A material breach happens when one party fails to fulfill contractual obligations, providing the aggrieved party with grounds to sue for damages and potentially terminate a contract. An immaterial breach refers to violations that do not fundamentally alter the contract’s essence. Yet, they may also entitle the injured party to claim damages.

Anticipatory Breaches

Anticipatory breaches occur when one party provides notice and/or indicates that they will not fulfill contractual obligations before the due date of performance.

The breach is based on an expectation that the other party will not fulfill their obligations in the future.

The party on the other side of the anticipatory breach might be able to terminate the contract and seek damages even though the time for performance has not yet occurred.

Common Seller Breaches

In real estate, a seller breach refers to any failure by the seller to fulfill their obligations as set out in the contract. This could include anything from failing to disclose known defects in the property to failing to provide a clean title to the buyer. These contract disputes can disrupt the transaction and potentially lead to legal action. Below, we cover some of the most common types of seller breaches.

Failure to Disclose Known Property Defects

Sellers are legally obligated to disclose any known defects that could affect the property value or desirability. New York sellers often have to complete a property condition disclosure statement. If a seller intentionally conceals such defects, it constitutes a breach of contract, and the buyer may seek legal remedies.

These defects could range from structural issues, like a faulty foundation or leaky roof, to issues with the property systems, like electrical problems. However, it must be proven that the sellers were aware of specific issues or defects and intentionally chose not to disclose them to the buyer.

Failure to Provide a Clean Title

A clean title, free from liens or other encumbrances, is crucial for a successful real estate transaction.

These could include unpaid taxes, unsatisfied mortgages, judgments against the seller, restrictions, and covenants limiting the use of the property.

Such claims and liens can impact the property value and hinder the buyer’s ability to use and enjoy the property as intended. If a seller fails to provide a clean title at closing, it may be considered a breach of contract.

Failure to Complete Repairs or Improvements

If a contract stipulates that the seller will complete certain repairs or improvements before closing, failure to do so may lead to contract disputes.

These repairs could range from minor cosmetic upgrades to significant structural changes. They may include tasks like fixing a leaky faucet, repainting walls, replacing damaged flooring, or even larger projects like repairing a damaged roof or updating an outdated plumbing system.

In such cases, the buyer may be entitled to compensation or may even opt to cancel the transaction.

Failure to Provide Truthful and Accurate Representations and Warranties

Sellers must provide accurate representations and warranties about the property they intend to sell.

For instance, a seller might warrant that the property’s ventilation and cooling systems are in good working order, that there are no defects, or that the property complies with all relevant zoning laws. If these statements are false or misleading, the seller can be said to have breached the contract.

Common Buyer Breaches

Just as sellers can breach contracts, buyers can also be at fault. Breaches can range from financial missteps, such as failing to provide adequate funds for a deposit, to failing to satisfy pre-closing contingencies. Below are some common ways a buyer might breach a real estate contract.

Failure to Provide Adequate Funds for Deposit

A real estate contract typically requires the buyer to provide a deposit, also known as earnest money, to secure the property.

This deposit is a sign of the buyer’s intent to purchase and is typically held in an escrow account until the sale’s closing. If the buyer fails to provide this deposit in the agreed-upon amount and timeframe, it may constitute a breach of contract.

Failure to Provide Adequate Funds to Complete Transaction

The most fundamental obligation of a buyer is to pay the agreed-upon purchase price at closing. If the buyer cannot provide sufficient funds to complete the transaction, it is considered a breach of contract.

The seller could choose to terminate the contract, leaving the buyer without the property they intended to purchase. The seller could also sue the buyer for specific performance, forcing them to complete the purchase.

Alternatively, the seller may keep the buyer’s deposit as damages in the event of a breach of the agreement. In some cases, the seller may even be able to resell the property to a different buyer and sue the original buyer for any price difference.

Failure to Satisfy Pre-Closing Contingencies

Real estate contracts often include contingencies that must be satisfied before closing. These include securing financing, selling an existing home, or obtaining satisfactory inspection results.

For instance, if a buyer fails to secure a mortgage by the specified date or fails to have the property inspected within the agreed timeframe, it might be legal grounds for breach of contract claims.

Consequences of Breaching a Real Estate Contract

The potential implications of breaches of real estate contracts can affect all parties involved in a transaction.

Legal Consequences: Legal action is one of the most common consequences of breaching a real estate contract. The aggrieved party may file a lawsuit seeking specific performance (forcing the breaching party to fulfill their contractual obligations) and monetary damages.

Financial Consequences: Depending on the contract terms and the nature of the breach, these could include the forfeiture of deposits or the payment of damages.

Contact Us for a Free Consultation

A New York City breach can seriously impact business transactions. But at Richman Law Firm PLLC, we have extensive experience handling breach of contract claims in real estate litigation. Our contract lawyers work hard to ensure our clients a quick and favorable outcome.

Whether you’re dealing with a real estate contract breach, a lease dispute, or a disagreement over a real estate purchase or sale, our goal is to aid in your current dispute and protect your interests in future real estate transactions. Schedule a consultation today.