Is a purchase agreement between a buyer and auto broker legally binding?

UPDATED: Jan 4, 2012

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Is a purchase agreement between a buyer and auto broker legally binding?

Auto broker and I signed a purchase agreement for the price of a car. 2 days later he says he needed $1k more and wanted to back out of the deal. We agreed upon the price of the car but then he said his seller would not give him the help he needed to sell it for that price and needed $1k more. I disagreed saying the “purchase agreement” we both signed with all of the terms was a binding document; he claimed it was merely “an offer”. Is he able to back out of the deal like this? On the agreement were terms stating that the buyer would be liable for the money if he backed out but it says nothing about the seller.

Asked on January 4, 2012 under Business Law, Oregon


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

For a definitive answer, you should have an attorney review the document--the specific language of contracts controls them.

That said, as a general matter, if the agreement indicates that party 1 will sell party 2 a car for $X, that would seem to constitute a binding and enforceable contract. Party 1 would not be able to ask for more money for the car, even if his/her own costs increased, unless the agreement somehow allowed for that, such as by saying something to the effect that if the cost to the broker is more than contemplated, the broker may pass that cost on to the buyer; or if the agreement stated merely that the broker would use his/her "best efforts" to procur the car for a certain price, which would allow him/her out of it if that could not be done.

However, apart from the above, it would usually be the case that what you describe is a binding contract to sell a car for $X, and you could, if necessary, sue to enforce it.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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