terminate purchase agreement over HOA documents

I am the buyer of a property in California. Escrow was originally 30
days, currently we are 60 days into escrow, as I had requested two
extensions due to unexpected problems obtaining a loan. These
extensions were agreed upon by the Seller w/o any conditions.

The property in question is a condo. The HOA is suing the developers
for repairs to the structure. This was known before entering into the
purchase agreement. All HOA documents were delivered to me before I
attempted to purchase the property.

I had requested additional HOA documentation as they became available
during the escrow extensions. Recently, the latest batch contained
preliminary test results of the structural damage to the building. I
feel that the test results reveal a worst case scenario for repairs and
I gave notice to terminate the contract on the basis of rejecting the
latest HOA documentation.

The seller, as expected, wishes to keep the good faith deposit of 3%.
We are going into arbitration in January. I had signed away on all
contingencies, except this one, on the "PDRS As-Is Addendum" (doesn't
appear to be from the C.A.R.):

"5. Buyer's Contingency. This contract is contingent upon Buyer's
approval of HOA documentation. Within 5 days of receipt of Seller's HOA
documentation (even if incomplete), Buyer shall provide to Seller one
of the following:

a. A written contingency removal pertaining to the HOA documentation.
b. A demand for further information/documentation. Seller shall provide
such information/documentation (and/or notify Buyer in writing as to
its unavailability) within 2 days after receiving said demand. Buyer
shall, upon receipt of additional information/documentation or notice
of its unavailability, have 3 days therefrom to remove the contingency
or cancel the Contract or,
c. A written notice of cancellation upon Buyer's disapproval of HOA
documentation.
"

I had quoted clause 5B and 5C as my reasons for terminating the
contract. Does my termination of contract fall under that contingency?
I have no other contingencies (ie home inspections, etc..). I feel
that the additional test results showed a more serious problem than the
original HOA documentation.

Thanks!

Re: terminate purchase agreement over HOA documents

"Jack Satoa" <> wrote:

>The seller, as expected, wishes to keep the good faith deposit of 3%.
>We are going into arbitration in January. I had signed away on all
>contingencies, except this one, on the "PDRS As-Is Addendum" (doesn't
>appear to be from the C.A.R.):

In general, your contingencies aside, any new information that comes to
light and that materially affects the value of the property should kick off
a 3/5 day right of recision (3 days if documents delivered directly, and 5
days if documents mailed).

Also, the 3% liquidated damages is merely the maximum damages that you
could be liable for in any case. And in all cases, the seller must show
damages -- not merely inconvenience, but actual damages. If the seller were
damaged to the tune of, say $1,000, then $1,000 is what he gets. If his
damages were $150,000, but 3% was only $18,000, then $18,000 would be all
he could get.

It's silly in the Bay Area for sellers to hassle buyers over the 3%. It's
still a seller's market, so the best course of action is to just wave
goodbye to the buyer and try to find a new buyer as quickly as possible.
Now the seller can't sell the property until the matter with you is
resolved.

Possibly the seller is just distraught because now his place has dropped in
value. Now that the condition of the structure is known, it's unlikely
he'll get what he was hoping to get. However, while he may blame you for
this turn of events, know that this isn't damage you caused him. You dodged
a bullet. His property hasn't been worth what he thought it was for quite
some time.

Where are the realtors in all of this? What is their opinion?

Even though you agreed to arbitration, nothing says you can't consult a
lawyer. I'd ask my realtor (if you have a good relationship) for a
recommendation. Failing that, I'd ask the local bar association for a
referral to a lawyer that specializes in this type of case. Personally, I
doubt your deposit will be dinged, must less will you lose the 3%, but I'm
not a lawyer. A real estate lawyer can tell you exactly what you're up
against and what the chances of different outcomes are.

Good luck!

Re: terminate purchase agreement over HOA documents

"Jack Satoa" <> wrote in message
news:
>I am the buyer of a property in California. Escrow was originally 30

You can not waive your rights when buying a primary residence in California.
If you could get the loan and the reason is the structural condition, you
should be able to get your deposit. The lender is a third-party beneficiary
and as such they have a say on the condition of the property. The lender
did not sign the PRDS agreement.

www.AmericanWest.biz

> days, currently we are 60 days into escrow, as I had requested two
> extensions due to unexpected problems obtaining a loan. These
> extensions were agreed upon by the Seller w/o any conditions.
>
> The property in question is a condo. The HOA is suing the developers
> for repairs to the structure. This was known before entering into the
> purchase agreement. All HOA documents were delivered to me before I
> attempted to purchase the property.
>
> I had requested additional HOA documentation as they became available
> during the escrow extensions. Recently, the latest batch contained
> preliminary test results of the structural damage to the building. I
> feel that the test results reveal a worst case scenario for repairs and
> I gave notice to terminate the contract on the basis of rejecting the
> latest HOA documentation.
>
> The seller, as expected, wishes to keep the good faith deposit of 3%.
> We are going into arbitration in January. I had signed away on all
> contingencies, except this one, on the "PDRS As-Is Addendum" (doesn't
> appear to be from the C.A.R.):
>
> "5. Buyer's Contingency. This contract is contingent upon Buyer's
> approval of HOA documentation. Within 5 days of receipt of Seller's HOA
> documentation (even if incomplete), Buyer shall provide to Seller one
> of the following:
>
> a. A written contingency removal pertaining to the HOA documentation.
> b. A demand for further information/documentation. Seller shall provide
> such information/documentation (and/or notify Buyer in writing as to
> its unavailability) within 2 days after receiving said demand. Buyer
> shall, upon receipt of additional information/documentation or notice
> of its unavailability, have 3 days therefrom to remove the contingency
> or cancel the Contract or,
> c. A written notice of cancellation upon Buyer's disapproval of HOA
> documentation.
> "
>
> I had quoted clause 5B and 5C as my reasons for terminating the
> contract. Does my termination of contract fall under that contingency?
> I have no other contingencies (ie home inspections, etc..). I feel
> that the additional test results showed a more serious problem than the
> original HOA documentation.
>
> Thanks!
>
>

Re: terminate purchase agreement over HOA documents

For the 3/5 day right of recision, is this 72 hours, or midnight start
of day 0 to midnight end of day 3? I'm over 72 hours, but within the
midnight to midnight for 3 days. (if it's 72 hours, can I use the
active contingency removal thing? where the seller has to give me a
Buyer to Perform b4 the contingency is automatically lapsed?).

I believe they will argue that the information that came to light was
not new, just verifying what was originally anticipated in the lawsuit.
It's up to interpretation the extent of damages though.

Arbitration has been moved up to tomorrow (Dec 30). Let's see what
happens. Thanks!

Robert Hallsey wrote:
> "Jack Satoa" <> wrote:
>
> >The seller, as expected, wishes to keep the good faith deposit of 3%.
> >We are going into arbitration in January. I had signed away on all
> >contingencies, except this one, on the "PDRS As-Is Addendum" (doesn't
> >appear to be from the C.A.R.):
>
> In general, your contingencies aside, any new information that comes to
> light and that materially affects the value of the property should kick off
> a 3/5 day right of recision (3 days if documents delivered directly, and 5
> days if documents mailed).
>
> Also, the 3% liquidated damages is merely the maximum damages that you
> could be liable for in any case. And in all cases, the seller must show
> damages -- not merely inconvenience, but actual damages. If the seller were
> damaged to the tune of, say $1,000, then $1,000 is what he gets. If his
> damages were $150,000, but 3% was only $18,000, then $18,000 would be all
> he could get.
>

Re: terminate purchase agreement over HOA documents

"Jack Satoa" <> wrote:

>For the 3/5 day right of recision, is this 72 hours, or midnight start
>of day 0 to midnight end of day 3? I'm over 72 hours, but within the
>midnight to midnight for 3 days. (if it's 72 hours, can I use the
>active contingency removal thing? where the seller has to give me a
>Buyer to Perform b4 the contingency is automatically lapsed?).

Since the time is not recorded, I'm sure it goes by the date, not 72 hours.

But since the new information doesn't appear to be part of a specific
contingency, I'd say you have to beat the clock and seller doesn't have to
give you a notice to perform. But, I'm not a lawyer! :)

>Arbitration has been moved up to tomorrow (Dec 30). Let's see what
>happens. Thanks!

Good luck. I hope it all works out for you.

Re: terminate purchase agreement over HOA documents

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www.westlist.com - they just redid the real estate community and it's a good
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account it's free.









"Jack Satoa" <> wrote in message
news:
>I am the buyer of a property in California. Escrow was originally 30
> days, currently we are 60 days into escrow, as I had requested two
> extensions due to unexpected problems obtaining a loan. These
> extensions were agreed upon by the Seller w/o any conditions.
>
> The property in question is a condo. The HOA is suing the developers
> for repairs to the structure. This was known before entering into the
> purchase agreement. All HOA documents were delivered to me before I
> attempted to purchase the property.
>
> I had requested additional HOA documentation as they became available
> during the escrow extensions. Recently, the latest batch contained
> preliminary test results of the structural damage to the building. I
> feel that the test results reveal a worst case scenario for repairs and
> I gave notice to terminate the contract on the basis of rejecting the
> latest HOA documentation.
>
> The seller, as expected, wishes to keep the good faith deposit of 3%.
> We are going into arbitration in January. I had signed away on all
> contingencies, except this one, on the "PDRS As-Is Addendum" (doesn't
> appear to be from the C.A.R.):
>
> "5. Buyer's Contingency. This contract is contingent upon Buyer's
> approval of HOA documentation. Within 5 days of receipt of Seller's HOA
> documentation (even if incomplete), Buyer shall provide to Seller one
> of the following:
>
> a. A written contingency removal pertaining to the HOA documentation.
> b. A demand for further information/documentation. Seller shall provide
> such information/documentation (and/or notify Buyer in writing as to
> its unavailability) within 2 days after receiving said demand. Buyer
> shall, upon receipt of additional information/documentation or notice
> of its unavailability, have 3 days therefrom to remove the contingency
> or cancel the Contract or,
> c. A written notice of cancellation upon Buyer's disapproval of HOA
> documentation.
> "
>
> I had quoted clause 5B and 5C as my reasons for terminating the
> contract. Does my termination of contract fall under that contingency?
> I have no other contingencies (ie home inspections, etc..). I feel
> that the additional test results showed a more serious problem than the
> original HOA documentation.
>
> Thanks!
>
>

Re: terminate purchase agreement over HOA documents

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"CalNeva" <> wrote in message
news:OAdsf.47689$
>
> "Jack Satoa" <> wrote in message
> news:
>>I am the buyer of a property in California. Escrow was originally 30
>
> You can not waive your rights when buying a primary residence in
> California. If you could get the loan and the reason is the structural
> condition, you should be able to get your deposit. The lender is a
> third-party beneficiary and as such they have a say on the condition of
> the property. The lender did not sign the PRDS agreement.
>
> www.AmericanWest.biz
>
>> days, currently we are 60 days into escrow, as I had requested two
>> extensions due to unexpected problems obtaining a loan. These
>> extensions were agreed upon by the Seller w/o any conditions.
>>
>> The property in question is a condo. The HOA is suing the developers
>> for repairs to the structure. This was known before entering into the
>> purchase agreement. All HOA documents were delivered to me before I
>> attempted to purchase the property.
>>
>> I had requested additional HOA documentation as they became available
>> during the escrow extensions. Recently, the latest batch contained
>> preliminary test results of the structural damage to the building. I
>> feel that the test results reveal a worst case scenario for repairs and
>> I gave notice to terminate the contract on the basis of rejecting the
>> latest HOA documentation.
>>
>> The seller, as expected, wishes to keep the good faith deposit of 3%.
>> We are going into arbitration in January. I had signed away on all
>> contingencies, except this one, on the "PDRS As-Is Addendum" (doesn't
>> appear to be from the C.A.R.):
>>
>> "5. Buyer's Contingency. This contract is contingent upon Buyer's
>> approval of HOA documentation. Within 5 days of receipt of Seller's HOA
>> documentation (even if incomplete), Buyer shall provide to Seller one
>> of the following:
>>
>> a. A written contingency removal pertaining to the HOA documentation.
>> b. A demand for further information/documentation. Seller shall provide
>> such information/documentation (and/or notify Buyer in writing as to
>> its unavailability) within 2 days after receiving said demand. Buyer
>> shall, upon receipt of additional information/documentation or notice
>> of its unavailability, have 3 days therefrom to remove the contingency
>> or cancel the Contract or,
>> c. A written notice of cancellation upon Buyer's disapproval of HOA
>> documentation.
>> "
>>
>> I had quoted clause 5B and 5C as my reasons for terminating the
>> contract. Does my termination of contract fall under that contingency?
>> I have no other contingencies (ie home inspections, etc..). I feel
>> that the additional test results showed a more serious problem than the
>> original HOA documentation.
>>
>> Thanks!
>>
>>
>
>