Last Updated May 14, 2019

Law and Practice

Contributed By McGuireWoods LLP

Authors



McGuireWoods LLP has a diverse real estate practice of more than 80 lawyers and land use planners in its offices in Tysons, Charlottesville, Richmond and Norfolk, with skills in a wide range of traditional and non-traditional real estate transactions. The firm’s transactional representation spans all aspects of real estate acquisition, development, financing and disposition, including acquisition, sale, leasing and financing transactions, as well as project finance, construction, public-private partnerships, negotiation of local and state incentives and privatization transactions. The team respresents clients around the world on various sides of such transactions, including Fortune 500 companies. The transactional practice is complemented by the firm’s land use expertise, as it frequently handles zoning and land use matters for development projects.

The representations and warranties provided in a purchase and sale agreement vary widely, depending on the agreement.  Typical representations and warranties include the following:

  • Authority: that each party is duly authorized to execute the agreement and to take all action contemplated by the agreement.
  • No violation: that the execution of the agreement and the consummation of the transaction will not result in a breach of any other agreement or violate applicable law.
  • No litigation: that there are no actions, suits or proceedings (including any condemnation proceedings) pending or threatened against the property.
  • No bankruptcy: that the seller has not filed for protection or relief under any applicable bankruptcy or creditor protection laws.
  • No hazardous waste: that no portion of the property has been used to generate, manufacture, treat, store, handle or dispose of hazardous waste.
  • Possession: that there are no parties in possession of the property other than the seller.
  • Taxes: that certain taxes (eg, rollback taxes) will not become due and payable as a result of the transaction.

The buyer’s remedies for a breach vary widely, depending upon what is negotiated in the purchase and sale agreement. In some agreements, it is merely a condition to closing that the representations and warranties be true and correct; in these agreements, the buyer may only recover its deposit and its third party out-of-pocket expenses. In other agreements, the seller may include a provision that prohibits the buyer from suing for any damages for a breach unless and until the aggregate amount of such damages exceeds a certain minimum threshold, whereupon the seller shall be liable for all damages up to a capped amount. In any event, recovery is usually limited to actual damages incurred, excluding consequential, exemplary, or punitive damages. 

McGuireWoods LLP

1750 Tysons Boulevard
Suite 1800
Tysons, VA 22102-4215

+1 703 712 5000

+1 703 712 5050

info@mcguirewoods.com www.mcguirewoods.com
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Authors



McGuireWoods LLP has a diverse real estate practice of more than 80 lawyers and land use planners in its offices in Tysons, Charlottesville, Richmond and Norfolk, with skills in a wide range of traditional and non-traditional real estate transactions. The firm’s transactional representation spans all aspects of real estate acquisition, development, financing and disposition, including acquisition, sale, leasing and financing transactions, as well as project finance, construction, public-private partnerships, negotiation of local and state incentives and privatization transactions. The team respresents clients around the world on various sides of such transactions, including Fortune 500 companies. The transactional practice is complemented by the firm’s land use expertise, as it frequently handles zoning and land use matters for development projects.

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