A buyer and seller in Sacramento execute a California RPA and later have a disagreement over credits for repairs. The contract includes both mediation and arbitration clauses that were properly initialed. Under the standard California RPA, which dispute resolution step must the parties attempt first?
Correct Answer
B) Mediation with a neutral mediator
Under the standard California RPA, the mediation clause requires the parties to attempt mediation before proceeding to arbitration or litigation. This is a prerequisite step — failure to mediate first can result in loss of the right to recover attorney's fees.
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Related Topics & Key Terms
Key Terms:
Related Concepts
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.
Earnest money is a deposit made by the buyer at the time of the offer or shortly after to demonstrate good faith and serious intent to purchase the property. It is also called a good faith deposit.
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