New Build Contract

What is the name of your state? OHIO

My spouse and I signed a new build contract with a national/local builder. A clause in our contract states "SELLERS FAILURE" If Seller fails to comply with this agreement without legal excuse, and Purchasers are in compliance Agreement, then Purchasers shall, as Purchasers sole remedy, be entitled to terminate this transaction whereupon Seller shall cause the refund of all Earnest Money and Option Deposits to Purchasers together with the sum of $1,000.00, not as a penalty but as liquidated damages, since actual damages would be speculative and difficult to assertain. Purchasers hereby waive all other remedies, including the right to recover money damages in excess of the Earnest Money, Option Deposits and liquidated damages specified above. No interest shall ever be attributed to any Earnest Money or Option Deposits".

Here is what transpired...

CAD drawer submitted the plans for our home to contractor.
The contractor poured the foundation per the CAD drawing.
Come to find out, the CAD drawer submitted the wrong blueprint for our home and the front porch was poured 1 ft. left of center and also a 3/4 bath rough-in in the basement was piped for a 1/2 bath instead (no shower line or floor drain). The builder presented the front porch issue to us and advised they would need to fix the problem by cutting off 1 ft. on the left side and repouring the needed 1 ft on the right side. This also required a one sided wall inside the basement with an extra support beam placed for added support. The 3/4 bth issue was not brought to our attention, we noticed it when we visited the building site. The fix they proposed was to cut out the poured floor, add the shower line by tapping in to the commode line. Anyway, in discussing the fix for the porch with the contractor who was going to do the work, he advised that his company does not routinely do one sided walls as they tend to buckle over time. This totally alarmed us and we were not comfortable with our foundation being altered in this manner, nor their fix to the shower problem, so we requested Cancellation of the Contract.
The builder advised they would have no problem returning all our Earnest Money. however, they do not feel like they owe us the additional $1000.00 per the above contract clause.

The Seller failed to comply with the agreement as they could not provide us with a quality built home. This isn't even in question as they admitted that their quality did not meet theirs oe our specifications, and we feel that we are qualified for the additional $1,000.00 liquidated damage monies as well. We made 20+ trips to the homesite to check on progress since initial signing of the agreement and incurred the cost of gas, wear and tear on our vehicle, our time and also purchased items for the new home that we wouldn't have purchased for our current home because it is much smaller. We consider this incurring damages.


Do you believe we should hold out for the additional $1,000.00 or cut our losses and be done with it? It is not the $$ that makes us want to pursue this, it is the fact that had we been in breach of contract, the builder wouldn't have thought twice about keeping all our earnest money so why should we permit them to non-adherence to their own contract?

Your insight would be appreciated.

[HomeGuru]

[quote]Originally posted by shespy4
[b]What is the name of your state? OHIO

My spouse and I signed a new build contract with a national/local builder. A clause in our contract states "SELLERS FAILURE" If Seller fails to comply with this agreement without legal excuse, and Purchasers are in compliance Agreement, then Purchasers shall, as Purchasers sole remedy, be entitled to terminate this transaction whereupon Seller shall cause the refund of all Earnest Money and Option Deposits to Purchasers together with the sum of $1,000.00, not as a penalty but as liquidated damages, since actual damages would be speculative and difficult to assertain. Purchasers hereby waive all other remedies, including the right to recover money damages in excess of the Earnest Money, Option Deposits and liquidated damages specified above. No interest shall ever be attributed to any Earnest Money or Option Deposits".

Here is what transpired...

CAD drawer submitted the plans for our home to contractor.
The contractor poured the foundation per the CAD drawing.
Come to find out, the CAD drawer submitted the wrong blueprint for our home and the front porch was poured 1 ft. left of center and also a 3/4 bath rough-in in the basement was piped for a 1/2 bath instead (no shower line or floor drain). The builder presented the front porch issue to us and advised they would need to fix the problem by cutting off 1 ft. on the left side and repouring the needed 1 ft on the right side. This also required a one sided wall inside the basement with an extra support beam placed for added support. The 3/4 bth issue was not brought to our attention, we noticed it when we visited the building site. The fix they proposed was to cut out the poured floor, add the shower line by tapping in to the commode line. Anyway, in discussing the fix for the porch with the contractor who was going to do the work, he advised that his company does not routinely do one sided walls as they tend to buckle over time. This totally alarmed us and we were not comfortable with our foundation being altered in this manner, nor their fix to the shower problem, so we requested Cancellation of the Contract.
The builder advised they would have no problem returning all our Earnest Money. however, they do not feel like they owe us the additional $1000.00 per the above contract clause.

The Seller failed to comply with the agreement as they could not provide us with a quality built home. This isn't even in question as they admitted that their quality did not meet theirs oe our specifications, and we feel that we are qualified for the additional $1,000.00 liquidated damage monies as well. We made 20+ trips to the homesite to check on progress since initial signing of the agreement and incurred the cost of gas, wear and tear on our vehicle, our time and also purchased items for the new home that we wouldn't have purchased for our current home because it is much smaller. We consider this incurring damages.


Do you believe we should hold out for the additional $1,000.00 or cut our losses and be done with it? It is not the $$ that makes us want to pursue this, it is the fact that had we been in breach of contract, the builder wouldn't have thought twice about keeping all our earnest money so why should we permit them to non-adherence to their own contract?

Your insight would be appreciated.

**A: take your $1000 money and run.