Sandra and Mike execute a C.A.R. RPA for a $550,000 condo in San Jose. The agreement includes a mediation clause. After a dispute arises over repair credits, Mike wants to file a lawsuit immediately. Under the C.A.R. RPA's dispute resolution provisions, what must Mike do first?
Correct Answer
B) Attempt mediation before filing a lawsuit or initiating arbitration
The C.A.R. RPA includes a mediation provision that requires the parties to attempt mediation before filing a lawsuit or initiating arbitration. A party who fails to mediate before filing legal action may lose the right to recover attorney fees, even if they prevail in court.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Contingencies are conditions written into a real estate contract that must be met before the transaction can close. If a contingency is not satisfied, the buyer can typically cancel the contract without penalty.
Contract termination occurs when a contract is ended or discharged, releasing both parties from their obligations. A contract can be terminated through performance, mutual agreement, operation of law, or breach.
A counteroffer is a response to an original offer that changes one or more terms of the offer, effectively rejecting the original offer and creating a new offer. The party who makes the counteroffer becomes the new offeror.
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