Contracts
A Connecticut seller and buyer sign a contract with a $20,000 earnest money deposit. The buyer backs out without a valid contingency. The seller's remedies may include:
AOnly keeping the earnest money
BKeeping the earnest money AND suing for additional damages if the earnest money doesn't cover actual losses✓ Correct
CAutomatically receiving the property back
DOnly suing for specific performance
Explanation
When a buyer breaches a contract without a valid contingency, the seller may: (1) retain the earnest money as liquidated damages if the contract so provides, OR (2) retain the earnest money and sue for additional actual damages if the liquidated damages clause is not exclusive, OR (3) sue for specific performance to compel the purchase.
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