# Previous buyers change mind, want resold property after all?



## Ander (Dec 2, 2015)

Hi everybody,

A friend of mine just bought a new condo in Vancouver. Someone else had put down a deposit on the unit before it was built; but when the property was finished and the developer contacted them to close the deal, they said they'd changed their minds and didn't want it. So the seller signed a purchase contract with a friend of mine and accepted a deposit from him.

Now the first buyers say they want the unit after all. The seller doesn't have anything signed by the first buyers verifying that they'd backed out of their deal. (Since they wouldn't get their deposit back, they weren't interested in further contact with the seller at that point.)

Where does this leave my friend? He really wants the unit and isn't willing to cancel the agreement the seller made with him. Was the first buyer's verbal cancellation enough to enable the seller to resell the property? Were they required to wait for a certain period of time before doing so, or are there other requirements?

My friend is waiting to get legal advice—but meanwhile, anything you can tell me, based on your experience or knowledge, would really help. Thanks!


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## Just a Guy (Mar 27, 2012)

Since there are many details missing, I can only give you a vague response. The developer should have an initial contract for purchase which had the deposit and future payments outlined. If the initial purchaser is in breach of contract by not following the outline, then most contracts would say what happens (probably it reverts back to the developer after a certain time). 

Best to have the developer to read his own contract, the answers will be there.


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## Ander (Dec 2, 2015)

Thanks for your reply. Rather than just complaining about "missing details", you could've told me _which_ details you thought were missing so I could've tried to provide them.

As far as I know, had the 1st buyer not verbally forfeited their purchase, their agreement would still be valid. Are you saying their forfeiture was was irrelevant, then, and the seller is still obligated to sell to them, invalidating my friend's agreement?

In such a case, is a seller required to have _signed _confirmation of the forfeiture before they can resell the property? How can that be a reasonable requirement? How can a cancelling buyer who's losing their deposit be expected to go to the trouble to provide that?


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## Just a Guy (Mar 27, 2012)

In any court case, it's not what people "say" that matters, it's what people can PROVE that matters. Did the original buyers verbally decline? Is there any proof? Maybe the developer lied, maybe the buyers are lying now...no one really knows. Are there other clauses in the contract that may apply to this situation (there probably is if it's a real developer)?

The original contract between the developer and the original purchasers is the first key. It needs to be read to determine if the developer actually had the right to resell the property the way he did. As I stated before, which you seemed to have missed, is your friend's developer needs to review the original agreement.

If the developer didn't legally regain possession, your friend is probably out of luck with that particular unit, and the developer would probably need to make some kind of amends. Of course, there are probably similar units available in the complex, so the developer may just offer another unit. 

The situation you've outlined is rather complex, being described third party, and done in 4 paragraphs...the list of what's missing is sort of large I would think, it wasn't so much a "complaint" as a statement of the obvious I thought. An anonymous forum is probably not the best place to seek advice, especially if you want a specific answer to a specific case. Of course, being rude to people trying to help won't really encourage others to respond either.


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## Rusty O'Toole (Feb 1, 2012)

Time is the essence of a real estate deal. There is a time given when the deal is to close, if that day passes and the buyer does not come to the table with the money the deal becomes null and void. This should all be spelled out in the original agreement. But normally there is a closing day and if either party does not show up that is the end of it. Theoretically there could be a lawsuit over non performance but this almost never happens.


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## carverman (Nov 8, 2010)

Rusty O'Toole said:


> Time is the essence of a real estate deal. There is a time given when the deal is to close, if that day passes and t*he buyer does not come to the table with the money the deal becomes null and void*. This should all be spelled out in the original agreement. But normally there is a closing day and if either party does not show up that is the end of it. Theoretically there could be a lawsuit over non performance but this almost never happens.


This case is similar in some ways to a resale, where a potential buyer agrees to buy the property, puts a deposit down with the offer to purchase, then decides that they don't
want that property. They change their mind for what ever reason.

They lose their deposit and the property goes back on the market. If the buyer decides to back out closer to the closing date, where the seller
has made arrangements to buy their own new property and arrange for moving on closing..the buyer that backed out will be taken to court and sued for costs incurred, which can
be very significant, while the seller is waiting for a new buyer to put in an offer.

The difference in this case, is that it is a developer, who may have other condos available. It depends on how the initial buyer made the deal with the developer and what was
explained to them in the contract. In any case they may lose their deposit...and that may be why..all of a sudden, the first buyer is again interested. 
The second buyer probably can't do anything with this specific condo until the first buyer settles with the builder (buy it with probably additional penalties from the builder for the delay)
or lose their deposit. ..I would think.


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## Charlie (May 20, 2011)

I'm understanding your friend bought from the developer and not from the original buyer.

The developer's issues with the original buyer are not really your friend's problem unless he can't deliver the condo. In that case he's breached your friends deal. 

Most likely, unfortunately, the contract your friend signed will have some damages clause that is favorable to the developer. So while legal action may be the only route, the cards will be stacked against your friend. If the developer's right to resell isn't clear, then it's a bit of poker game with the developer to see which buyer he chooses to challenge. My guess is that clauses in your friends contract, and in the original buyers contract address the inability to deliver/failure to pay and define damages in a way that may seem unfair in hindsight. The developer's done this stuff before, and he's the one who drafted the sales contracts with his protection in mind!


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## carverman (Nov 8, 2010)

Buying real estate can become a complicated boondoggle if there are two buyers involved with a piece of property and deposits on that same property. 
Here is an example of what can happen if it goes to the courts.

http://www.thestar.com/life/homes/2013/01/25/who_gets_deposit_when_house_deal_falls_apart.html



> Here are the lessons:
> 1.Understand your rights are before you sign a real estate contract and make a deposit.
> 
> 2.If you are a buyer, understand that *once an agreement is signed and accepted, you cannot simply change your mind, even one day later.*
> ...


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## Ander (Dec 2, 2015)

*Thanks*

Thanks for your input on this a while back. In exchange for letting the other buyers have the condo, the developer gave my friend another unit—on the upper floor, with a much better view—for the same price. So everybody was a winner on that one. :?)

BTW, in my reply above, where I said:



> Rather than just complaining about "missing details", you could've told me which details you thought were missing so I could've tried to provide them...


...I wasn't trying to be critical. I simply wanted to know what significant details I could've failed to provide, and the responder hadn't given me any clues.


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## eligoldman (Apr 24, 2017)

Just a Guy said:


> Since there are many details missing, I can only give you a vague response. The developer should have an initial contract for purchase which had the deposit and future payments outlined. If the initial purchaser is in breach of contract by not following the outline, then most contracts would say what happens (probably it reverts back to the developer after a certain time).
> 
> Best to have the developer to read his own contract, the answers will be there.


Thanks for your reply..


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