Whether you’re a buyer or a seller of residential real estate here in Florida, the important thing to know about “duress” is that it can end a deal. Duress is a deal-breaker.
What is Duress in a Residential Real Estate Transaction?
What is duress? It is a legal defense under Florida law. It protects a party from having to go through with a sales contract for real property.
Duress happens when a party to the real estate sales agreement has signed or executed the contract document, or entered the sales transaction, without his or her own free will. They’ve been forced — or bullied — into it: legally, they’ve made the deal “under duress.”
When you are bullied into something, legally you’re a victim of duress.
Duress is a legal defense to going through with a contractual obligation. If you are the seller, then duress protects you from having to transfer title to your property. If you are the buyer, duress acts to stop any transfer of your funds to the seller in order to close on the purchase.
However, duress does not go so far as to negate or “void” the real estate sales agreement automatically. It creates a “voidable’ contract (more on that below).
1. Duress is a Legal Defense With Specific Elements That Must Be Proven with Admissible Evidence
First, the party seeking to assert duress must prove legal duress under the requirements of Florida law. This must be shown with facts that are both admissible and authenticated as evidence, shown by either documents and/or the testimony of witnesses.
There must be enough valid evidence to demonstrate two things:
(a) that the act sought to be set aside (i.e., the residential real estate deal) was effected involuntarily and thus not as an exercise of free choice or will; and
(b) that this condition of mind was caused by some improper and coercive conduct of the opposite side.
See, City of Miami v. Kory, 394 So.2d 494 (Fla. 3d DCA 1981).
The victim of duress must prove both of these things in order to establish her legal defense and get out of the real estate agreement.
2. Duress Does Not Include Third Parties
In a residential real estate contract, duress can act to set aside the deal if it is proven — but only if the basis of that duress, or coercion, arose from actions undertaken by one of the parties to the contract itself. It is “improper external pressure” from either the buyer or the seller that will amount to legal duress in Florida.
If the buyer or the seller felt “improper external pressure” from a third party, that will not amount to legal duress allowing him or her to get out of the deal. The actions of a third party cannot be used to prove up duress. See Cronacher v. Cronacher, 508 So.2d 1270, 1271 (Fla. 3d DCA 1987); Bubenik v. Bubenik, 392 So.2d 943, 944 (Fla. 3d DCA 1980).
3. Duress Does Not Automatically Void the Sales Agreement
The controversy isn’t resolved after duress is proven. That’s because under Florida law, the real estate sales contract is rendered “voidable” — not void. What’s the difference?
Void Residential Sales Contracts
Under Florida law, a “void” contract has no validity. It cannot be enforced by either the seller or the buyer. No court will respect its terms. It’s not legally effective.
The parties are in the same position they were in before the deal was made: the seller has his condo or home; the buyer has their money (or their pre-approval for a mortgage loan from a lender).
Example of a void contract?
A quick example of a void residential real estate sales contract would be a seller who tries to sell a condo or home without holding legal title to it. The seller can’t sell what he doesn’t have, so any sales agreement she entered into with a prospective buyer would be considered void under Florida law.
Voidable Residential Sales Contracts
Sales contracts for residential property in Florida can be considered “voidable” if one party has the ability and right to cancel the agreement because of a legal reason or justification. This party has the option to enforce the agreement, or not, depending upon which option is best for him under the circumstances.
Example of a voidable contract (outside of duress)?
A residential real estate contract signed by a party who is not of legal age (a minor) or who was legally incapacitated at the time the document was executed. Either of these signatories create a voidable contract where they can walk the deal at any time.
Choice to Be Made By the Victim of Duress
After duress is proven, the victim must decide what to do. When there has been duress by the seller in a residential real estate transaction, for example, then the buyer is not bound to the contract. It is considered a “voidable” contract.
Should the buyer walk away? Or should he negotiate and move forward to close on the transaction? If the buyer chooses to move forward despite the duress, then that voidable contract will be respected by the courts and enforced.
In sum, void contracts are dead in the water because Florida law renders them unenforceable, period. Voidable contracts remain valid contracts under Florida law, but the victimized party has the ability to void it, and the party who committed duress may not be able to enforce it.
4. Duress Has a Limited Life Span
Here’s another important thing about duress. It has a limited life span: if you prove duress exists, then it’s shown that you entered into the deal or affirmed the transaction under your own free will, then the past duress won’t matter. You’ll be held to the bargain. Stone v. Austin, 107 So. 2d 232 (Fla. 2d DCA 1958).
The life of duress ends if the victim of coercion exercises their free will to go ahead with the real estate deal. After that, the duress defense won’t be available to them. This is true whether they’ve made a conscious choice to do so, or if they moved forward unaware that by doing so, they were foregoing any future claims of duress.
Duress Involves Behaviors By Both The Seller and The Buyer
Duress doesn’t happen on just one side of the closing table. It is shown by demonstrating in evidence the behavior on the part of both the seller and the buyer. This is called the “duality of duress” by Florida courts.
The (1) victim of duress (either the buyer or the seller) acts involuntarily, and does so because of improper conduct, or duress, on the part of (2) the other party. City of Miami v. Kory, 394 So.2d 494, 497 (Fla. 3d DCA 1981).
For instance:
- If the seller tries to coerce but fails, there’s no legal duress defense for the residential buyer to use because he or she didn’t fall victim to it and fail to use their own free will.
- If the buyer regrets the deal, and argues later that he or she was pressured into closing on the home or condo, there’s no duress unless there are facts to demonstrate that the seller acted improperly and coercively in the deal.
This is important to any duress claim. To prove duress in a Florida court, or at a Florida negotiation table, you will need to show the duality of duress in your situation.
Needing Relief From Duress in a Florida Residential Real Estate Sales Contract?
If you have problems with a pending sales agreement to sell residential real estate here in Florida, then you may need to consider if you have been the victim of duress. If you feel you have been forced to enter into the sales agreement against your free will, then you may be able to prove duress if you can provide admissible evidence that establishes its legal elements.
An experienced Florida real estate lawyer can explain the requirements necessary to prove duress in your particular circumstances, as well as assisting you if you are feeling pressured to sign a residential sales contract and think you may be subject to duress.
A Florida real estate attorney can help you figure out the best route for you to take, as well as helping advocate for you with both sellers, buyers, and real estate professionals (brokers, agents).
Many real estate attorneys, like Larry Tolchinsky, provide an initial consultation at no charge.
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