When have the terms of a real estate contract been met?
The recent case Duong v. Stein centers on when the terms of a real estate contract have been met.
Real Estate cases are usually filed in the Chancery Court, which gives the court the opportunity to look beyond the legal aspects of the case and take all other relevant facts into consideration.
In this case, the court found that all terms of the contract were met and, although the mortgage commitment was withdrawn, the buyer’s actions and statements indicated their unwillingness to go through with the purchase. See the judge’s opinion below:
34-2-6821 Duong v. Stein, N.J. Super. App. Div. (per curiam) (7 pp.) Plaintiffs appealed from the grant of summary judgment in favor of defendants. Plaintiffs filed suit seeking return of their deposit on an agreement to purchase real property. Defendants filed a counterclaim, arguing they were entitled to keep the deposit and receive damages for plaintiffs’ failure to close after plaintiffs failed to meet all the lender’s condition to receive a mortgage. The purchase agreement was conditioned upon plaintiffs’ obtaining a mortgage, calling for rescission of the contract and return of plaintiffs’ deposit if they could not obtain a mortgage commitment unless due to plaintiffs’ bad faith or lack of diligence. Although plaintiffs obtained a mortgage commitment, the lender withdrew two days prior to closing over concerns about the source of deposited cash. In support of their motion for summary judgment, defendants argued that the lender’s condition was met prior to closing and that they would have extended the closing for plaintiffs to secure reinstatement of the mortgage commitment. Defendants alleged that plaintiffs became concerned about the cost of flood insurance and attempted to justify withdrawal from the purchase agreement over the loss of the mortgage commitment. Plaintiffs went on to purchase another property using the same lender, while defendants ultimately sold their property for $17,000 less than they had agreed to sell to plaintiffs for. The trial court ruled that plaintiffs’ failure to close after securing a mortgage commitment warranted judgment and damages for defendants. On appeal, the court affirmed, ruling that the record reflected that defendants offered plaintiffs the opportunity to close and it was plaintiffs who willfully chose to walk away from the deal. [Filed July 5, 2018]
You can read more about the case here. You can also call us at (856) 642-6445 to get help reviewing a real estate contract.