3.4 Statute of Frauds, Breach Remedies & Mandatory Property Disclosures

🎯 Key Florida Real Estate Statutory Takeaways

• Under the Statute of Frauds (F.S. § 725.01), real estate purchase contracts, deeds, mortgages, and leases over 1 year must be in writing to be enforceable.
• Statute of Limitations to sue for breach in Florida: 5 years for written contracts; 4 years for oral contracts.
• Under Johnson v. Davis, residential sellers MUST disclose all known latent material defects; 'as-is' clauses do not waive this duty.
• Condominium resale buyers have 3 business days to cancel upon receiving condo docs; HOA disclosure non-delivery grants 3 days to cancel before closing.

Real estate contracts are governed by contract law and statutory formalities. The Florida Statute of Frauds (F.S. § 725.01) mandates that contracts conveying an interest in real estate—including purchase agreements, option contracts, deeds, mortgages, and leases for more than one year—must be in writing and signed by the party to be bound to be legally enforceable in a court of law. Florida Statute § 95.11 establishes the Statute of Limitations: an aggrieved party has 5 years to file suit on a written contract and 4 years on an oral contract.

When a party breaches a purchase contract, legal remedies include: (1) Liquidated Damages (seller retains earnest money deposit as predetermined compensation); (2) Specific Performance (equitable court action compelling the breaching party to complete the conveyance); or (3) Compensatory Damages (suing in court for actual financial losses incurred).

In Johnson v. Davis, 480 So.2d 625 (Fla. 1985), the Florida Supreme Court abolished caveat emptor for residential real estate. Sellers (and their agents) have an affirmative duty to disclose all known latent material facts that affect property value which are not readily observable to the buyer. Merely selling the property 'as-is' does not shield the seller from liability for failing to disclose known defects.

Florida imposes mandatory statutory disclosures: (1) Condominium Resale Disclosure (F.S. § 718.503), granting buyers a 3-business-day right of rescission upon receiving association documents; (2) Homeowners' Association Disclosure (F.S. § 720.401), granting a 3-day cancellation period that terminates at closing; and (3) Lead-Based Paint Disclosure (42 U.S.C. § 4852d) for residential target housing built prior to 1978, with a 10-day inspection window.

⚠️ Common Pearson VUE / FREC Exam Traps

• Believing oral real estate contracts are void — oral contracts are valid between parties, but UNENFORCEABLE in court under the Statute of Frauds.
• Assuming 'as-is' contracts protect sellers from non-disclosure — 'as-is' does NOT relieve sellers of Johnson v. Davis latent defect disclosure obligations.
• Confusing condominium resale cancellation periods (3 business days) with developer sales (15 calendar days).