Can I still back out of contract if one of the sellers has not yet signed off on an addendum?

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Can I still back out of contract if one of the sellers has not yet signed off on an addendum?

The property for sale is from a divorce where both he and she must sign off on everything. The contract addendum has been delivered to the sellers and verbally agreed to by both (I think) and signed by her. He, however, has yet to sign it. And, even though the inspections are done the repairs have already been performed, if he doesn’t sign off on the contract addendum before the deadline for doing so, can I get out without unscathed? Or is there a real chance of not only losing my earnest money but also losing a breach of contract suit?

Asked on July 28, 2011 Ohio

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Technically, an addendum is a piece of paper adding new terms to an already existing contract between the parties in my experience. Meaning, the parties already have a valid contract. Something else has popped up after the contract has been entered into and the parties want it to be part of the agreement via an addendum.

An addendum is different than a counter offer. A counter offer is a document exchanging a new proposal between people who are not in contract.

If there is a liquidated damage clause in the agreement and you do not want to close escrow, you can end up possibly losing your deposit if characterized as liquidated damages and not have to worry about a breach of contract action of the seller ends up selling the property later for an amount below what you agreed to.

If the husband does not sign the addendum, as opposed to a counter offer, most likely you still have to close escrow under the terms that have been agreed to or risk losing your deposit. You just do not get what you want in the addendum.

If you have a real estate agent representing you, consult with him or her further about your question. If not, consult with a real estate attorney to read your contract and the addendum.

Good luck.


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