Every state is different.

Not in Colorado, Seller has to sign off on the release of EM and Termination of Contract.

Ditto to Roy's answer...

Yes if court ordered.

You must comply with your state and local laws.

Janice Poole It depends.  Some escrow companies will make a decision as to who the EM goes to in the event of a dispute - unless there is clear language to the contrary in the contract...  consult an attorney for legal advice!

Better check with the state board...ours has a free legal hotline...That would not happen here unless it was ordered by the court.

Can they? In my state, yes. Will they? Probably not unless the buyer gets a lawyer to push it.

In my state buyers have have a due diligence period in which they can cancel for any reason including just changing their minds. In that time period buyers can unilaterally cancel contract. I still seek to obtain sellers signature on the document, but buyers are certainly entitled to their EMD back in a timely manner. If the listing agent notifies me buyers do not intend to sign I send a certified letter to sellers and if it goes uncontested for 10 days I can give buyers their EMD back. (mind you this is my state and may not apply outside of Georgia)

We don't have escrow companies in my jurisdiction.

In what State?

Its  way to complicated to answer this  without  more information.  

 They can release the Ernest money but  mainly only if the release of the funds is not contested by the seller.  

I have  learned is a good thing to never go over the small claims court limit on an Ernest deposit,  Ends the whole issue in a few weeks rather than never or months or years.