A Connecticut buyer defaulted on a residential purchase contract that contained a valid liquidated damages clause designating the earnest money deposit as the seller's sole remedy. Which of the following actions would NOT be permitted under the liquidated damages clause as written?
Correct Answer
D) The seller pursues specific performance in Connecticut Superior Court to compel the buyer to complete the purchase
When a purchase contract contains a valid liquidated damages clause designating the earnest money deposit as the seller's sole remedy, the seller is contractually limited to that remedy upon the buyer's default. Pursuing specific performance — an equitable remedy that would compel the buyer to complete the purchase — is inconsistent with the 'sole remedy' designation in the liquidated damages clause. By agreeing to limit recovery to the deposit, the seller waived the right to seek specific performance or other additional remedies for the buyer's breach.
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