Is it legal to limit who a property can be sold to?
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Is it legal to limit who a property can be sold to?
I am purchasing a lot, but the sales contract has a clause stating that if I choose to resell, I can’t sell to a certain person or their family members. Is this legal and does it fall under discrimination?
Asked on August 11, 2011 New York
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
First, it is legal to put a limitation on subsequent resale of property (think: when you download software, the licensing agreements generally put limitations on your ability to resell; while not strictly analogous, it is a parallel case). In a contract, the parties may agree to any restrictions or conditions they choose, with the only caveat that the conditions not themselves be illegal; and similarly, even before a contract is actually formed, one party may make it a condition of his or her offer that the buyer agree to not resell in certain ways; if the buyer accepts the offer, he takes it subject to that condition.
It is not illegal to not sell to a given person--there is no law saying that anyone must be able purchase anything, and just as the original seller of a lot could refuse to sell to "John Doe," so can he require the buyer to commit to not sell to "John Doe," too. Discrimation in housing or in places of public accomodations against a race, religion, sex/gender, age over 40, or the disabled is illegal, but refusing to sell to a specific person or family is not discrimination.
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