On appeal from Superior Court, Chancery Division, Essex County.
Antell, Brody and D'Annunzio. The opinion of the court was delivered by Antell, P.J.A.D.
[215 NJSuper Page 274] On August 15, 1986 plaintiffs entered into a contract prepared by a real estate broker for the purchase of residential property owned by defendants. Jill Slattery, Esq., an attorney at law, signed the contract for defendants pursuant to a power of attorney executed July 21, 1986. It appointed her to "act as . . . Agent (called an attorney in fact) to do each and every act which [they] could personally do . . . with respect to signing of any and all documents pertaining to the sale of" the premises in question. Slattery then submitted the contract for review to a
second attorney, Sanford Silverman, Esq., who registered his written disapproval thereof on August 18, 1986, within three days after the contract was signed. Defendants thereafter agreed to sell the property to another party at a higher price.
The following notice appears at the top of the first page of the contract signed by the parties hereto:
This is a legally binding contract that will become final within three business days. During this period you may choose to consult an attorney who can review and cancel the contract. See section on attorney review for details.
The section on attorney review is contained in Paragraph 19 and reads as follows:
The Buyer or the Seller may choose to have an attorney study this contract. If an attorney is consulted, the attorney must complete his or her review of the contract within a three day period. This contract will be legally binding at the end of this three day period unless an attorney for the Buyer or the Seller reviews and disapproves of the contract.
On August 22, 1986 plaintiffs filed this complaint for specific performance of the contract and their notice of lis pendens. The Chancery Division granted defendants' motion for summary judgment after oral argument on September 4, 1986. Plaintiffs appeal.
In challenging the order under review plaintiffs argue that the Chancery Division erred in its interpretation of the attorney review clause. They argue that execution of the contract on behalf of the sellers by an attorney constitutes "approval" thereof by the attorney, or at least raises a fact question thereof, and that later disapproval by another attorney, even though within the prescribed three day period, does not prevent formation of an enforceable contract. Supported by the New Jersey Association of Realtors, which has filed a brief amicus curiae, they contend that the Chancery Division's interpretation encourages abuse of the provision by allowing sellers, as happened ...