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ARTICLE ID 49614

Bailment - Breach of contract - Real estate - Attorney allegedly failed to file deed when seller changed his mind after closing - Out of pocket expenses.

Rockingham County, New Hampshire

In this contract matter, the plaintiff was the purchaser of residential property. The plaintiff contended that the bank’s attorney failed to file the deed in the matter because the seller changed his mind and wanted more money. The plaintiff filed suit on the theory of bailment. The defendants denied that any bailment was created and argued that the matter should proceed on a specific performance claim.

The plaintiff and his wife were the purchasers of a residential property from the sellers. During the closing there was some disagreement between the seller husband and his wife wherein the seller husband wanted more money for the property. The papers were signed and given to the defendant bank attorney for filing. Sometime thereafter, the plaintiff contended that the attorney failed to file the papers since the seller husband asked him not to as he had changed his mind about the sale. The attorney evidently said he would hold the deed and not file it until the purchasers and sellers resolved the outstanding issues. The plaintiff brought suit alleging that the defendant attorney was negligent and violated the bailment created by the entrustment of the signed deed to him for filing. The plaintiff also alleged that the defendant interfered with the contractual relationship between the buyer and seller and conspired not to go through with the sale by not filing the deed.

The plaintiff sought return of the value of the replacement house and out of pocket expenses for rent and other expenses, which totaled $________.

The defendant attorney argued that there was no bailment created. The defendant argued that there was no violation of the bailment since no bailment was created by the attorney taking possession of the deed for purposes of filing the document. The plaintiff argued conversely that the deed was a piece of personal property and was worth the value of the house that it represented. By failing to file the deed, the plaintiff argued that the defendant violated that bailment and was liable for damages that included the value of the replacement property and out of pocket expenses.

The defendant attorney argued that the proper cause of action would have been an action for specific performance to compel the sellers to turn over that specific property to the plaintiff. Interestingly, the plaintiff did not bring a cause of action for specific performance. The defendants also argued that the plaintiff was only entitled to minimal damages since on the theory of betterment, the plaintiff would have had to incur the out of pocket expenses regardless of whether or not the attorney failed to file the deed.

At the conclusion of the trial, the plaintiff obtained a verdict in his favor but for considerably less than the damages sought which plaintiff’s counsel has asked to remain confidential.

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