Real Estate Deposit Litigation
Fighting It Out In Court Is A Bloodsport Where No One Wins & Costs Are Prohibitive
When a real estate deal falls apart after a deposit is paid there are certain normal procedures that are followed. What happens if things don’t proceed the normal way and there is real estate deposit litigation?
In short, when parties can't agree on what to do with the deposit, everyone loses.
Litigation over real estate deposits in Ontario is the worst-case scenario of the classic prisoner’s dilemma.
In the prisoner’s dilemma, two people are pitted against each other. If neither betrays the other both will be ok. If one betrays the other, the traitor will do well and the other will suffer. The final option is that both betray each other, and both suffer worst of all.
Litigation is the double betrayal scenario of real estate deposits, where everyone suffers the worst possible consequences.
Why Is Litigating A Real Estate Deposit The Worst Case Scenario For Everyone?
Mostly because it is intended to be that way.
The high costs and low profit of real estate deposit litigation are meant to deter fighting over asinine and long-decided issues.
Bad advice combined with unscrupulousness still leads people to unjustly withhold or demand real estate deposits.
The only people enriched in this scenario are the victor’s lawyers- everyone else including the loser’s lawyers will probably be taking a haircut.
The lawyers can sustain this kind of hit, indeed they may have factored partial payment into their charges. Going to court is a more serious loss for the parties involved, who lose sleep, and potentially their life savings.
What Should Be Done To Contest For A Real Estate Deposit
Both parties need to work together to come to a reasonable compromise.
Even if you think the other side is morally, factually or legally wrong, it may be better to settle with them. Agreeing to them keeping half the money to cover their own losses is better than going to court and ‘winning’ 100%.
Your court costs will amount to more than 50% of your ‘victory’ payment. You will also have lost time and sleep over the issue.
Not. Worth. It.
If you need a legal expert to negotiate you out of a real estate pickle, give Larson Lawyers a call now. +1-888-731-4013