Damage Prior to Closing

PHOTOS: Tropical Storm Isaias causes major damage across Maryland | WBFF

Specific Performance


What happens if a property is damaged between the Agreement date and Closing?

The damage is estimated to be over $100,000.00.  

The Seller is not cooperating with the Buyer at all, and won’t provide the Buyer with an opportunity to see the property and assess the damage.

The Seller’s lawyer is recommending termination of  the transaction. The Buyer wants to assess the damage and wants the property. The Buyer can’t afford to buy anything else as equivalent prices have gone up substantially since the purchase date.

What’s the best course of action if the Seller is not cooperating at all, Keep in mind the Seller could make over $200,000.00  more profit if he sells the property today.


The Buyer has the right to elect to close the transaction with an abatement in the purchase price. They also have the right to inspect for damage. That was the Harkness v, Cooney case. The Buyer may have to bring an application under the Vendors and Purchasers Act in order to get a Court Order authorizing the inspection.

There may or may not be insurance which will cover this. The Seller is not under any obligation to maintain insurance. In fact, if the damage is quite serious, the mortgagee might step forward and take the money and simply paydown their own mortgage. So, nothing gets repaired right away. This will likely come later with a construction loan secured by a mortgage at higher rates.

Obviously, the Seller wants to oppose this. The price has gone up in a rising market.

The preferred remedy may be Specific Performance. This situation immediately calls for a litigation lawyer to file a caution, commence an action, apply for a Certificate of Pending Litigation (CPL) and file that against the title to the property.

Brian Madigan LL.B., Broker


Leave a Reply

Your email address will not be published. Required fields are marked *