Need to back out of a deal after down payment has been paid - help!

[Kristina Mancaruso]

Dad bought fixer-upper for $210,000 and already made down payment of $20k. Before closing someone broke into the house and stole all the copper from the plumbing.  Now, our family doesn't feeling comfortable moving into the house. The contract states we have 10 days to back out of the deal without any penalty. But when we tried to back out today the seller refused saying that he'll sue for the time lost. The only way we would keep it is to fix and flip (dad is a contractor) but according to the calculator, we would probably lose money on the deal. Is the seller being truthful or just using scare tactics. Our lawyer isn't very competent, if its just scare tactics and we need a better lawyer - how do we find a good one who can get us out penalty free? 

[Curt Davis]

Are you sure the 10 day period you are referring to is not the due diligence period from the time the contract was signed by your dad?  I have never heard of a seller willing to buy a home back within 10 days after selling it, just the cost alone would not be good.