Realtor had two parties under contract to purchase a property

Realtor had two parties under contract to purchase a property

South Berwick, ME · Member since 2021 · 3 posts · 0 votes

I am looking for any recommendations for any lawyers in Maine that may be able to help with a legal issue regarding a contract dispute I am currently having. 

Last November my partner and I put an offer on a short sale property. We were told that there was currently an offer on the property but were still accepting additional offers. We signed our P&S and the backup addendum and submitted. We were told by our realtor the next day that our offer was accepted and we were bumped to first position. Being a short sale we still had to wait for the bank to go through their processes and appraisals so we knew it would be a few months before any further movement in the process. during that time our realtor reached out to the seller agent on the status and was given updates as they came. In March we were told that the bank had accepted the offer and the closing was to be scheduled. At this point the seller agent informed our agent that we were not getting the property because we were still the backup offer. Upon further investigation it was revealed that the estate attorney for the property mistakenly signed the backup addendum in the section that released that contract making us the primary offer. They essentially told us "too bad" and went ahead with the closing with the other party.

Our questions are how much of a case do we have and what kind of compensation/cost to fight this? We have also filed a complaint with the state Real Estate Commission but they have yet to make a ruling (and they have no real timetable as to when they will get to it). 

Thank you in advance to any recommendations/referrals!

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  • Real Estate Broker · Jacksonville FL & Middletown, CT · Member since 2008 · 1k+ posts · 632 votes
    4y

    And this is exactly why agents that don't understand short sales should just leave them to those of us that do. 

    However your back up addendum statement is confusing. Are you saying you and the seller agreed to sign an addendum to be a back up buyer? Who is the "estate attorney for the property"? Are the owners dead? Or was this attorney given POA by the sellers? If not, attorneys cannot bind anyone by signing contracts as they are not principals to the transaction.

    Either way - if you had a contract SIGNED BY SELLERS AND BUYERS without any back up buyer language then yes I believe you have a case against the sellers/listing brokerage. They sold the property to two individuals at the same time and now you are out time and money (damages). I have no idea why people assume short sale contracts are not binding just like any other contract. Especially when they should know better as "professionals"

    Keep in mind though that even if that is the case, there was likely a clause in the contract stating the sale was subject to lender approval, so they will simply say they never met the contingency. Could get complicated.

  • Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    4y

    @Benjamin Prescott Yeh, I knew something was off when you said you signed an offer as a back up and then the next day you were in first position.  While this is incompetence by the listing agent/“estate attorney” you don’t have much of a position.  As you know, your contract in a short sale is subject to lender approval…they approved a contract from someone else and rejected approval for yours…sort of catch all out for the other parties. I have actually seen some short sale agents who Continually sought higher offers after they had a buyer under contract going through the short sale process…I never believed in this, never did it, and wouldn’t deal with any listing agents who did this.

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