Property owner sues buyers for breaching at closing

Ann Knef Jan. 31, 2008, 3:28am

Collinsville property owner John Forrester is suing a couple he claims breached a contract Nov. 15, 2007, to purchase a home located at 1222 Ridge Prairie Ln.

Represented by Todd W. Sivia and Alicia J. Downs of Sivia Business & Legal Services in Edwardsville, Forrester is seeking $488,888, plus carrying costs, interest, costs of suit, attorneys fees and other relief, from James and Barbara Hicks.

According to a complaint filed Jan. 18 in Madison County Circuit Court, Forrester and the Hicks entered into a purchase contract agreement Sept. 29, 2007, in the amount of $475,800.

On Sept. 30, 2007, the parties entered into a counter offer contract wherein the purchase price was changed to $488,888.

"The parties further changed the contract to provide that buyer would obtain an update on the survey through TWM, Inc., and the seller will credit the buyer in the amount of $500.00 at closing," the complaint states. "No other changes were made to the Contract to Purchase Real Estate."

Forrester claims that the defendants' lender faxed a letter to the title and escrow agent on the closing date informing them that it was denying financing.

"According to the letter, the loan amount requested was for the amount of $464,400.00 with an interest rate of 5.375%," the complaint states.

"According to the real estate contract, however, the contract was contingent upon buyer obtaining a mortgage loan commitment for only 50% of the purchase price," the complaint states.

Forrester claims he is attempting to mitigate his damages by listing the property and seeking willing and able buyers for the property.

"If the Plaintiff is unable to sell the property, the Plaintiff's damages will be $488,888," the complaint states.

"...Plaintiff has incurred additional damages including but not limited to the loss of the carrying costs of the property, which includes but is not limited to lighting costs, mortgage payments, insurance on the property, interest, fees and costs," the complaint states.

Forrester claims the defendants represented they would be able to purchase the property and would only need a loan in the amount of 50% of the purchase price and that they would be able to satisfy the remainder of the purchase price without taking out a loan.

"Defendants knew, or should have known, that they would not be able to obtain financing for anything but the full amount of the loan as they requested from the lender," the complaint states.

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