James McKenney

In responding to the question concerning TICs in San Francisco, Mr. Kass did not fully set forth the types of property ownership that prevail in California. For example, community property with right of survivorship is very popular. The reason that TIC ownership is offered in San Francisco is because there is a limit on condominium conversions and developers have therefore resorted to TIC to sell separate interests in property, which would be considered condominiums or planned developments in other areas. It does not seem prudent to give advice relating to a specific geographic area without knowledge in that area. While Mr. Kass puts some exculpatory language in the answer, why give any at all if it is not accurate.

Professional Publishing, of which I am counsel, publishes real estate forms for the western United States through its software provider TrueForms.com. We also sponsor risk management classes approved the California Department of Real Estate. In our forms we limit damages in the event of buyer's default in a residential transaction to 3% of the purchase price as required by California Civil Code section 1675. If the amount of liquidated damages exceeds this amount, the seller has the burden of proving that the amount actually paid is reasonable. Normally, a special addendum signed by the parties at the commencement of the transaction is required to justify the excessive damages. This is seldom done.