Daily Real Estate News  |  October 19, 2005  |   What Can You Do When a Hurricane Stops the Sale? In the aftermath of Hurricane Katrina, the Mississippi Association of REALTORSŪ' legal hotline has been busy taking calls from members who have breach-of-contract questions stemming from hurricane damage. For example: Do buyers have legal recourse to back out of a contract if property they’d agreed to buy has been damaged or destroyed by a hurricane? Ron Farris, MAR's general counsel and a member of Armstrong Allen PLLC in Jackson, Miss., says the issue has not been specifically addressed by Mississippi statutes or courts. However, based on normal principles of contract law, the purchaser may declare a contract void in the event of material damage to the property before closing, and shall be entitled to the return of earnest money, Farris says. Or the purchaser may elect to complete the transaction in accordance with this contract provided the property is restored by seller at seller’s expense prior to closing. This clause does not give sellers the right to void a contract in the event that the property to which they planned to move has been destroyed or damaged. But, says Farris, if the sellers includes the availability of their new residence as a condition to the seller's obligation to sell in the "Special Provisions & Contingencies" section of the purchase agreement, the seller would have the right to void this contract if the new property had been damaged or destroyed. Farris says such cases are "uncharted waters" for most practitioners, who should consult with a reputable legal source before proceeding in such cases. "Now is the time to be doubly careful and always check with the law," he says. —By Bridget McCrea for REALTORŪ Magazine Online