Can I rescind a contract to buy real estate after closing?
ANSWER.
Yes, in some limited circumstances. This will often require litigation and should not be regarded as easy.
Example: Fraud
If the Seller has made deliberate material misrepresentations to you about the property and you relied on them and suffered damage, you can seek to rescind on the basis of fraud.
Example: Failure to disclose facts which materially affect the value of the property.
This is a different standard than fraud. Where the Seller of a home knows of facts materially affecting the value of the property which are not readily observable and are not known to the Buyer, the Seller is under a duty to disclose them to the Buyer. If Seller fails to do so, Buyer may rescind, even after closing.
If the Seller has made inadvertent misrepresentations or failed to disclose things which materially affect the value of the property, you may rescind. You don’t have to prove the statements or lack of disclosure was deliberate or malicious – it’s enough that something wasn’t disclosed, BUT, it must be something important.
Example: Florida Condominium and HOA Statute
If you bought a Florida condominium, or property in a Home Owners’ Association (HOA), in reasonable reliance upon any material information that is false or misleading in the developer’s advertising and promotional materials, including the prospectus, brochures or newspaper advertising, you may have a cause of action to sue for damages, for up to one year* AFTER you close. This is a slightly different remedy than rescission, but illustrates what can be done AFTER closing. [*This period is sometimes longer, depending upon the circumstances].
Example: Federal Law
There are instances where a failure to comply with certain federal laws, such as the Interstate Land Sales Full Disclosure Act, may provide a right to rescind and receive a FULL refund of purchase monies, even up to two (2) years* after the date THE BUYER SIGNED the contract (even after closing). IMPORTANT: This revocation period has nothing to do with whether the builder did or did not promise to complete, or even completed construction within two years and many people get confused here ]. Many Florida developers take steps to exempt their projects from these laws. However, if the developer, or the sale, is not properly qualified for the exemption (whether residential or commercial) or the sales contract doesn’t meet certain standards, a Court may find the exemption inapplicable and so permit rescission. It is important to act timely here. That means rescind/revoke in writing BEFORE two years has expired. Click here__________and here ________________for further discussions of rescission under the Interstate Land Sales Full Disclosure Act.
CONCLUSION
There may be other situations in which you can rescind and obtain a return of your deposit funds OR sue for damages. This is not meant to be comprehensive and you should consult Florida counsel to evaluate your rights and weigh the likelihood of dispute or litigation about a rescission.
Learn more about rescission OR enforcement of your purchase and sale agreement AFTER closing by contacting us online or calling 239-963-1791 or toll free 866-504-8981.
These are generalizations only! Consult a Florida attorney for specific advice. Our office [239 262-2874] serves Collier and Lee counties (includes Naples, Fort Myers, Bonita Springs, Marco Island, Cape Coral, Estero) and can sometimes assist in other geographic areas. March 2008
~ FLORIDA ONLY – January 2012~
