parent nodes: Damages | deed | specific performance | Wolofsky v Behrman
damages for land contracts
The traditional measure of damages for breach of a contract to convey real property by deed is [nominal damages], measured on the day of breach. It is measured by the non-defaulting party's reasonable out-of-pocket costs.
Except where a vendor has acted in bad faith, his liability for beach of a real property sale contract is limited to the amount of deposit paid by the purchaser, with interest and reimbursement for expenses in investigating the property. [Flureau v Thornhill]; Wolofsky v Behrman.
The following circumstances count, among others, as "bad faith:" - if the person selling is in default
- if a purchaser makes a contract to convey a title he knows he can't acquire
- if a purchaser has title and refuses to convey
Additionally, about half the states offer consequential damages, see Hadley v Baxendale, measured by the difference between the contract price and the fair market value on the date of breach.
When the purchaser defaults, the vendor may ordinarily retain any down payments, earnest money, etc., and the burden of proof is put on the purchaser to recover any such money through suit.
Cases finding Flureau "bad faith"
Wolofsky v Behrman (vendor refused to convey title after finding someone living in the house)
Cases finding no Flureau "bad faith"
See also specific performance, recission