Thanks BG-but this chart relates to situations where an enforceable contract is in place. You can’t breach a contract until it exists. The question is when does the contract come into being. To summarize-if the buyer can walk away at any time until the contingencies are removed, it’s not a real contract. The Steiner case sort of suggests that if the buyer can walk away then the seller should be able to walk away too. Once the buyer can’t walk away then there is consideration and an enforceable contract comes into being. I am not saying this is settled law. It could be that court could find consideration in the money and time the buyer puts into removing contingencies. I just think it’s a good idea for the buyer to give the seller a certain amount of money that is itrevocable so that there is consideration on the buyers part. Can’t hurt.[/quote]Yeah, I like the idea of the $100 set aside for that purpose.
A buyer whose seller backed out “could” have their own house in escrow and some or all of their stuff in storage. They also could have given notice for the rental they are occupying and a new tenant had already been found by their LL, esp in most urban coastal areas of CA where the vacancy rate is <=3%. The buyer could also have money wrapped up in a physical inspection and/or engineer's report and have a rate lock that is soon to expire. So the buyer can be "damaged" if their seller pulls this stunt.
I'm just wondering if a hundred or a few hundred non-refundable deposit from a buyer plus the buyer insisting on that extra language in the contract (as suggested in your link) might deter some sellers from accepting their offer ... especially if their listed property lies in an area with a critical shortage of housing, such as Silicon Valley. Maybe some of these sellers are so cocky that they think qualified buyers who will "overpay" for their property are a dime a dozen.
