The 3-Year Aftermath of Black Hills Invs. v. Albertson’s: Recent Developments and Suggestions for Resolving an Asserted Black Hills Defense

by Randy Sullivan

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Whether negotiating a purchase agreement for real property that has not been subdivided or litigating the enforcement of the agreement, the attorney should determine whether the contract complies with the Subdivision Map Act. As the court stated in Black Hills Invs., Inc. v. Albertson’s, Inc. (2007) 146 Cal.App.4th 883, 893, if the agreement to sell unsubdivided property affords a party the right to waive the obligation to record a final subdivision or parcel map, then the contract is illegal and therefore void. The buyer then is free from its contract obligation and may demand the return of the deposit. Black Hills is particularly important in today’s upside down, uncertain, and litigious real estate climate. This article discusses the effects of the ruling in Black Hills Invs., Inc. v. Albertson’s, Inc., subsequent cases in which the defense has been raised, suggestions for the real property practitioner, and whether Black Hills incorrectly ruled that the contract was void rather than voidable.

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