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Disappointed seller of real estate can’t keep earnest money and sue breaching buyer

Alex De Grand State Bar of Wisconsin
Disappointed seller of real estate can’t keep earnest money and sue breaching buyer - Home Sellers - Housing Crisis - Home Buyers


July 23, 2009 – If a buyer backs out of a real estate sale, the seller can keep the earnest money as liquidated damages or sue for actual damages – but the disappointed seller cannot do both.



In Osborn v. Dennison, 2009 WI 72, a unanimous Wisconsin Supreme Court interpreted on July 9 the seller’s remedies for breach provided in the state’s mandatory WB-11 Residential Offer to Purchase form. If the seller fails to direct the broker to return the earnest money to the buyer before or at the same time as the suit for actual damages, the seller’s recovery is limited to liquidated damages, the court concluded.

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