What is my liability to vacationers who have booked mycondo in the event I sell it?
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What is my liability to vacationers who have booked mycondo in the event I sell it?
I rent it out in the spring and summer to vacationers. I have been trying to sell the unit and I just received an offer yesterday. My problem is that the new owner does not want to rent out the unit. What is my legal liability to the vacationers who have booked the unit? Can they sue me for breech of contract or failure to perform if I sell the unit and notify them as soon as I have a signed contract?
Asked on May 8, 2012 under Real Estate Law, Illinois
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
They have a choice of remedies:
1) First, they could sue you for breach of contract--you obligated yourself to provide them the rental, and a sale of your unit does not provide legal grounds to escape your contractual obligations. They could sue you for the cost difference of renting different but like space, if such is more expensive than what they would have paid you.
2) They could also sue your buyer. A buyer purchases real estate subject to all then-in-place leases, including leases to vacationers. Therefore, you buyer doesn't have the option of chosing to not rent to the vacationers you've already booked--he is bound to do so, because the leases/contracts go with the property. If he does not rent to them, he could be sued by them; and if you had represented to him that he had the right to not rent to them, he in turn could sue you for misrepresentation.
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