Legal Library

Attorney Fees and Buyer/Seller Disputes

July 19, 2018

Author: UAR

Section 17 of the REPC states, “In the event of litigation or binding arbitration arising out of the transaction contemplated by the REPC, the prevailing party shall be entitled to costs and reasonable attorney fees…The provisions of this Section 17 shall survive Closing.”

Now, I highlight this Section for a couple of reasons. First, notice that the language covers the prevailing party for litigation arising out of the transaction contemplated by the REPC. This is key because this allows the prevailing party to recover attorney fees for fraud, mistake, or error claim arising out of the REPC.

A common example would be when a Seller is accused of not disclosing a material fact about the property. Say the Buyer sues the Seller. If the Seller prevails, then the Buyer is on the hook for the Seller’s attorney fees. If the Buyer prevails, then the Seller would be responsible for the Buyer’s attorney fees.

Second, I actually hope that this REPC language deters litigation, rather than encourages it. A Buyer thinking about suing a Seller for nondisclosure needs to be relatively certain that he/she can prove that claim. If there isn’t enough proof or it seems like the outcome could go either way, then the Buyer may need to weigh the pros and cons of escalating the dispute to a law suit.

Lastly, I would unequivocally encourage Buyers and Sellers to do everything possible to resolve a dispute and use litigation as the absolute last resort. If you have questions about this REPC Section or anything else, feel free to call the UAR’s Legal Hotline at 801-676-5211 on Monday, Wednesday, or Friday from 8:30 a.m. to 4:00 p.m.


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