How Buyers and Sellers of Development Land Deal with Regulatory Risk
USC Legal Studies Research Papers Series No. 97-19
45 Pages Posted: 9 Feb 1998 Last revised: 3 Mar 2014
Date Written: March 3, 2014
A builder contracts to buy land for a development project and comes to realize either before orshortly after taking title that its proposed development project has diminished in value or even become worthless as a result of unanticipated government regulations. The builder wishes to dissolve the contract and get her money back. This paper describes the conflicting legal norms courts apply in such cases, and how contracts for development land may be written so as to apportion clearly the regulatory risk between buyer and seller.
JEL Classification: R38
Suggested Citation: Suggested Citation