Last Update: 5/21/18
Florida Real Estate Law Relating To Recission
According to Florida case law as of the date of this article, yes, it is too late for the purchaser to withdraw their rescission offer once the seller accepts it.
See: Hammond Realty Co. v. Wheaton, 90 So. 2d 292 (Fla. 1956)
Over 4 Years Negotiations And The Seller Rescinds The Deal
John Wheaton and Hammond Realty began negotiations regarding two lots in Miami-Dade County back in March 1950. They were negotiating the sale of the two parcels of land. A deal was reached, and a purchase agreement was prepared by Hammond Realty and sent to John along with a check for $100.00.
John kept the money. But John did not sign the contract.
The deal sat in limbo for over a year. Then John approached Hammond Realty again, at a price that was higher than the original deal.
This time, things looked good. Hammond Realty telegraphed its acceptance of the offer, and John confirmed the agreement, provided the closing date was moved up to the last of the following month.
The day the confirmation was received, Hammond Realty ordered an abstract of title. The title search came back with an attorney’s legal opinion that the title was clear and marketable. Hammond Realty deposited an additional sum of $100.00 towards the purchase.
Read: Title Insurance and Closing Your Florida Home Purchase
Then came more negotiations; this time over the kind of deed to be provided at the closing table. This went on for three months. At that point, Hammond Realty’s attorney submitted a Special Warranty Deed to John, with closing instructions that upon execution the deed should be forwarded to a certain bank with a draft attached for the remainder of the purchase price.
Nine days later, Hammond Realty again asked that John execute this Special Warranty Deed. John refused to do so. Instead, John offered to provide a deed at closing that was in a form unacceptable to Hammond Realty.
The November Letters – Are They Binding?
After 4 ½ years, negotiations ended. On November 8, 1954, Hammond Realty’s lawyer sent John’s lawyer a message that stated:
“If it is your client’s intention to rescind the transaction, then the deposit of $200.00 should be returned.”
Two days later, on November 10th, John’s lawyer responded. He stated that John thought the demand was unwarranted because the property had been withheld from the market for more than 4 years. Still, John had decided to accede to Hammond Realty’s request that the money be refunded.
John’s lawyer concluded his letter as follows:
“Will you, therefore, kindly advise me to whose order his [appellee’s] check should be drawn so that I may procure and forward it to you in final disposition of the entire matter.
“In view of the foregoing, the fact that neither you nor I can locate a copy of whatever contract existed between the parties, need give us no further concern.”
On November 15th, Hammond Realty’s attorney acknowledged receipt of the November 10th letter from John’s lawyer. He also advised John’s lawyer that on November 12th a lawsuit seeking specific performance of the contract had been filed by Hammond Realty.
The appellate court looked at the three November letters.
In them, they found that there was an opportunity to rescind whatever agreement existed at that time, or was then being formulated.
The letters also made it “equally plain” that John made the choice of rescinding, leaving nothing to be done to that end except the transmission of the sum of the down payments.
As for as the language contained in correspondence sent by John’s lawyer, the court found it was “quite natural” to inquire about who should get the payment. John did this promptly. Hammond Realty could not “work a withdrawal” of its offer to rescind whatever agreement may have been reached by the process of filing a suit for specific performance.
In sum, Hammond Realty offered John Wheaton the right to rescind the transaction. The offer to rescind was accepted by John. Hammond Realty’s attempt at withdrawal of the rescission was ineffective. Under Florida law, once an offer to rescind is accepted the transaction is ended and the parties are no longer obligated to one another except to pay back the deposits, with interest.
Related:
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- Florida Title Company or Real Estate Lawyer: Who Should Handle Your Closing?
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