What Happens When Buyer and Seller Both Claim the Escrow Deposit

Updated August 2026 · Reviewed by Adams, Cameron & Co.

A deal dies. The buyer wants the deposit back because the inspection was terrible. The seller wants it because the buyer missed a deadline. Both of them are certain, both of them call you, and the money is sitting in your brokerage escrow account.

This is one of the few moments in the job that Florida has scripted line by line, which is good news, because it means nobody has to improvise.

The first rule: the broker does not decide

It is tempting to think that the broker, having read the contract, should work out who is right and release the money. Florida does not permit that. Holding escrowed funds is a trust obligation, and F.S. 475.25(1)(d)1 makes failing to account for or deliver escrowed property a disciplinary matter.

Once there are conflicting demands, or the broker has a good faith doubt about who is entitled to the money, the broker owes the Commission notice and then has to put the question to somebody with authority to answer it.

The four ways out

The statute names them, and a broker picks one:

• An escrow disbursement order. Ask FREC to determine who is entitled to the escrowed property. The Commission decides, and a broker who follows the order is protected for having followed it.
• Arbitration. With the consent of all parties, submit the matter to arbitration.
• Mediation. With the written consent of all parties, submit the matter to mediation. Note the difference: mediation requires written consent where arbitration requires consent.
• Court. By interpleader or otherwise, seek adjudication of the matter by a court. Interpleader means the broker deposits the money with the court and steps out of the argument entirely.

Which one fits depends on the amount and the temperature. A disbursement order costs nothing and takes time. Interpleader costs legal fees, often taken from the deposit itself, and ends the exposure immediately.

The clock, which is the part that catches brokers

The statute says promptly. Rule 61J2-10.032 says what promptly means, and it is measured in business days rather than calendar days:

• 15 business days to notify the Commission in writing, counted from the last party's demand, or from the point the broker formed a good faith doubt.
• 30 business days to institute one of the four settlement procedures, counted the same way.
• 10 business days to notify the Commission if a disbursement order was requested and the dispute then settles or goes to court before the order issues.
• 90 days for mediation to be successfully completed, counted from the last demand, after which the licensee must promptly employ one of the other procedures.

The clock starts at the demand. Not when the broker gets around to it, and not when the file is reviewed. That single fact is why the practical instruction for a sales associate is so blunt.

Being late is its own violation, with its own price

Florida treats lateness here as a minor, separately punishable thing rather than folding it into the underlying dispute. The citation rule attaches specific amounts:

• Notifying the Commission after 15 business days but within 25: $100.
• Instituting a settlement procedure after 30 business days but within 40: $100.
• Failing to report a settlement or court filing within the prescribed 10 business days, but doing so within 20: $100.

Those amounts are set by rule and rules get amended, so treat them as the shape of the thing rather than a quotation from today. The point is not the money. It is that a paperwork delay becomes a documented violation, which is covered in what a FREC citation is and how it differs from a complaint, and the answer there is less comfortable than most agents assume.

What a sales associate actually does

Almost none of the above is your job. Four things are:

• Get the written demand to your broker the day it arrives. The clock started when the party demanded, so every day you sit on it is a day off the broker's 15.
• Put it in writing. A phone call from an angry buyer is not a demand you can date. Ask for it in writing, and forward it rather than summarizing it.
• Stop predicting the outcome. Telling a client they will obviously get the deposit back is the sentence that gets quoted at you later. You do not decide this and neither does your broker.
• Keep the file. Dates, deadlines, notices, what was delivered when. This is exactly the record brokerage record retention exists to preserve, and it is what any of the four procedures will turn on.

How to avoid getting here at all

Most escrow disputes are contingency disputes wearing a different hat. A buyer who canceled cleanly inside an inspection period does not usually produce a fight; a buyer who canceled two days late does. Understanding how Florida contingencies work and how the as-is contract handles cancellation prevents more of these than any escrow procedure resolves.

The other half is timing on the way in. The deposit has to reach the broker on schedule in the first place, which is covered in how long a broker has to deposit earnest money, and the basic mechanics are in what escrow is in a Florida transaction.

What to ask a brokerage

This is a genuine differentiator and almost nobody asks about it:

• Who monitors the 15 and 30 business day clocks, and is it a person or a calendar entry?
• Which procedure does the firm normally use, and why?
• Has the firm ever missed a deadline on this?

A broker who answers that fluently has done it before. It belongs with the rest of the infrastructure questions worth asking.

The short version

Nobody at the brokerage decides who gets the money. Notice to FREC inside 15 business days, one of four procedures inside 30, mediation done inside 90. Your part is to move the written demand up the chain on the day it lands, and to stop telling anyone how it will end.

The version of this that happens earlier, while there is still time to act, is verifying the deposit exists at all.