Going after earnest deposit in escrow.
Hello everyone and thanks in advance for any pointers or advice.
I, as a seller, have had this home in escrow for over a month. Buyers were qualified and solid offer above asking. Inspection report came after 15 days and all repair requested I agreed to. One of the requests was for a larger catchment tank. (This home is in Hawaii where water comes from rain catchment.) Because offer was well above asking and they seemed serious I agreed and spent 5k for a new tank installed.
The day all the repairs are completed and tank installed (after $6,000.) they send termination of contract notice, 2 weeks before scheduled close. They claim I broke contract due to the land survey report not being submitted on time. Which is true, I called all surveyors the day escrow opened and due to the location of property the earliest survey could be completed was after the date on contract. My agent informed sellers and their agent of the situation and delay very early on and they said no problem. Unfortunately this conversation was over the phone and not in writing. But they are not denying that they were informed and agreed to the delay.
Yet still they are backing out citing this breach of contract on my part. I had been in touch with them just a few days before they cancelled, asking them details of how they preferred the catchment installed. They did not mention anything about survey being late on that day, rather they gave me specific instruction where and what size catchment to install.
Bottom line, I know they have other reasons for backing out but are using the 0-1 as an excuse to try and hang on to their deposit (which is over 3k). I told them I was contesting this and wanted the deposit, to which they responded "Seller broke contract and are demanding deposit returned."
Mediation is suggested in contract if agreement cant be made.
What play do I have here.
Here is terminology n contract:
K-2 Survey. Within ______________ ( ) days after the Acceptance Date, Seller shall, at Seller’s sole cost and expense, have a land surveyor licensed in the State of Hawaii: (a) survey the Property even if the boundary points are visible and; (b) if improvements exist along the Property line, provide Buyer with a map (with surveyor’s stamp) and accompanying report to show the perimeters of the Property and the location of any improvements in the vicinity of the perimeter Property lines. The survey and map may not address whether improvements on the Property are in compliance with State and/or
County requirements, subdivision covenants, conditions, and restrictions, and/or condominium property regime requirements.
O-1 Termination Due to Default. This paragraph shall not apply to a particular obligation or contingency if Paragraphs O-2 or O-3 have been specifically designated as a termination provision.
In the event that Buyer is in default for failure to perform Buyer’s obligations under this Purchase Contract (Seller not being in default), Seller may terminate this Purchase Contract, and (a) bring an action for damages for breach of contract, or (b) retain the initial earnest money deposit and all additional deposits provided for in this Purchase Contract. However, if the Buyer has performed the obligation prior to Seller delivering written notice terminating this Purchase Contract, then his termination provision shall not apply to such obligation.
In the event Seller is in default for failure to perform Seller’s obligations under this Purchase Contract (Buyer not being in default), Buyer may (a) terminate this Purchase Contract and bring an action for damages for breach of contract, or (b) seek specific performance of this Purchase Contract. However, if the Seller has performed the obligation prior to Buyer delivering written notice terminating this Purchase Contract, then this termination provision shall not apply to such obligation.