California Real Estate Practice Exam

If a buyer breaches a real estate sales contract, the seller may opt for which of the following actions?

1. Action for damages

2. Action for specific performance

3. All of the above

4. Unilateral rescission

The correct answer is: Action for damages

The correct answer, which encompasses the full spectrum of options available to a seller in the event of a buyer breaching a real estate sales contract, is that the seller may choose from multiple remedies, including an action for damages, an action for specific performance, or unilateral rescission. If a buyer breaches the contract, the seller can pursue an action for damages. This means the seller can seek compensation for any financial loss incurred as a result of the breach, which might include lost profits or additional costs associated with relisting the property. Alternatively, the seller could opt for an action for specific performance. This legal remedy requires the buyer to fulfill their duties as outlined in the contract, compelling them to go through with the purchase. This option is particularly prevalent in real estate transactions because each property is unique, and damages alone may not be satisfactory to the seller. Finally, unilateral rescission allows the seller to terminate the contract unilaterally due to the buyer's breach, effectively releasing both parties from any obligations outlined in the original contract, while still potentially retaining the right to claim damages. Each of these actions offers the seller different avenues for addressing the situation. Therefore, limiting the answer to just one remedy overlooks the broader range of choices available to the