§9.7 - Remedies for Default

• Jurisdiction: Washington

§9.7 REMEDIES FOR DEFAULT

In the event of a default under the purchase and sale agreement, the buyer will want the right to seek any available remedy, but will specifically want the remedy of specific performance. In the event of a default by the buyer, the seller will generally want to keep the earnest money as liquidated damages (see Section 14 of Form 9-1, included on the CD accompanying this deskbook).

The default provision in Section 14.2 of Form 9-1, included on the CD accompanying this deskbook, mirrors language at RCW 64.04.005(1) and is applicable if the total earnest money deposit to be forfeited does not exceed five percent of the purchase price. This statute was adopted by the Washington state legislature in 1991 in response to the case of Lind Building Corp. v. Pacific Bellevue Developments, 55 Wn.App. 70, 776 P.2d 977, review denied, 113 Wn.2d 1021 (1989). In Lind, the court held that a seller could not retain the earnest money deposit as liquidated damages unless the...