In what circumstances will the seller be held liable for a transaction where the buyer refused to proceed and the seller subsequently rescinded the transaction?

California, United States of America


The following excerpt is from Stromer v. Browning, 420 P.2d 730, 55 Cal.Rptr. 18, 65 Cal.2d 421 (Cal. 1966):

In Cochran v. Ellsworth, supra, 126 Cal.App.2d 429, 272 P.2d 904, although the court uses language suggesting that the seller had not acted in good faith (p. 439, 272 P.2d 904), it will be observed that the buyer gave notice of rescission and that the seller promptly instituted an action for specific performance against him. Thereafter, following negotiations through their attorneys, the parties mutually agreed to rescind the transaction. Since the buyer was unwilling to proceed, the seller, by eventually agreeing to rescind the transaction, cannot be said [65 Cal.2d 427] to have acted with the bad faith which would make him liable for the commission.

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