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4 Most Common Contract Breaches in Real Estate Litigation

4 Most Common Contract Breaches in Real Estate Litigation

4 Most Common Contract Breaches in Real Estate Litigation
March 6, 2024

Real Estate

In the complex world of real estate transactions, contracts are the guidebooks that direct all parties’ actions, promises, and expectations. However, even meticulously drafted contracts can be breached, unexpectedly invoking the need for legal prowess in resolving disputes. 

As trusted advisors and litigators in this complex arena, the Gertz & Rosen, Ltd. team understands that preparation and proactive measures are the hallmarks of successful real estate management. Let’s navigate the choppy waters of real estate contract breaches and discover how strategic legal guidance can safeguard your investments and interests.

Common Types of Contract Breaches in Real Estate

No sound real estate contract is complete without understanding how they can be broken. In real estate, some of the most common contract breaches are: 

  1. Failure to Disclose Property Defects: Arguably one of the most contentious breaches, failing to disclose material property defects can result in significant financial and legal repercussions for the seller or lessor.
  2.  Non-Payment or Late Payment: Whether it’s the failure to submit the earnest money on time or to keep up with regular lease payments, any monetary breach can derail the entire transaction.
  3. Failure to Perform Repairs or Maintenance: Agreements often hinge on the “as-is” condition of the property or the incumbent duty of one party to perform necessary maintenance. A failure in this regard can constitute a breach of the contract terms.
  4. Violation of Lease Terms: Tenants and landlords alike are bound by the conditions stipulated in the lease agreement. Any violation can lead to a breach with accompanying legal ramifications.

Legal Remedies for Real Estate Contract Breaches

Understanding the available remedies in the event of a breach is crucial. Here are several common legal remedies to consider:

Damages: This involves monetary compensation, such as actual, consequential, or punitive damages.

Specific Performance: The court can require the breaching party to fulfill their contractual obligations.

Rescission and Restitution: This remedy entails terminating the contract and reimbursing the non-breaching party for any consideration provided.

These remedies provide a range of options to address breaches and protect the interests of the parties involved. It’s important to carefully consider the unique circumstances of your case and consult with legal professionals to determine the most appropriate course of action.

Preventing Contract Breaches Through Proactive Measures

Prevention is more cost-effective than cure. That’s why it’s important to take proactive measures to mitigate the risks of contract breaches. Some steps to consider include carefully reviewing and negotiating contract terms, conducting thorough due diligence, and ensuring all parties fully understand their obligations. Additionally, seeking legal advice before signing a contract can help identify any potential issues or red flags that may lead to breaches in the future.

Take Action Today

Contract breaches in real estate are more than mere legal problems; they directly impact your financial stability and reputation. With a grasp of the common breaches, the available legal remedies, and the proactive measures that could prevent them, you’re better equipped to navigate the field confidently. 

Trust in the seasoned professionals at Gertz & Rosen, Ltd. to fortify your stance in real estate contracts and disputes. Engaging with us is an investment in your peace of mind and the certainty that your real estate ventures are in good hands. Contact us today for a consultation.

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