On appeal from Superior Court, Law Division, Burlington County, whose decision is reported at 207 N.J. Super. 539.
Petrella, Bilder and Gaynor. The opinion of the court was delivered by Gaynor, J.A.D.
[217 NJSuper Page 235] Plaintiffs-sellers appeal from a judgment adjudicating the contract for the sale of their residence property to defendants-buyers as violative of the Plain Language Act, N.J.S.A. 56:12-1, et seq. and declaring their failure to have obtained a statement of the Federal Housing Commission setting forth the appraised
value of the property as a breach of the contract, thereby entitling defendants to a return of the deposit. Plaintiffs also contest the limitation on the nature of the damages awarded to them on their cross-claim against the broker who prepared the faulty contract.
The facts giving rise to this action are not in dispute. Plaintiffs, James J. and Charlotte Wheatly (sellers) entered into a listing agreement with Maffucci Realty, Inc. (broker) for the sale of their home at 109 Mohawk Trail, Shamong Township, Burlington County. Through the efforts of the broker and a co-broker, defendants, Myung Sook and In Sook Suh (buyers) submitted an acceptable offer for the property. Utilizing a preprinted form of contract and by filling in the blanks with the appropriate information, the broker prepared an agreement of sale which was executed by the parties.*fn1 The contract called for a deposit of $10,000, which was paid by the buyers, and contained the following mortgage financing contingencies:
This Agreement is contingent upon mortgage financing as follows:
(a.) Amount of mortgage loan required by Buyer: $98,900.00
(b.) Type Conventional, at the prevailing rate of interest.
(c.) Commitment date for the approval of the mortgage: March 14, 1984.
(d.) Maximum mortgage placement fee, if any, to be paid by Seller:
(e.) Minimum amount of appraisal required, if FHA financing:
(f.) Mortgage loan application shall be made as provided herein and if said mortgage loan cannot be obtained, then deposit monies paid hereunder shall be returned to the Buyer and this Agreement shall be void and of no effect; otherwise, if the Buyer or Maffucci Realty Inc. is able to secure the said mortgage, this Agreement shall remain in full force and effect.
(g.) Buyer shall make written applications for said mortgage within 7 days of Sellers execution hereof and shall give prompt and full cooperation in obtaining same. Should Buyer fail to make said applications, then Seller may declare this Agreement null and void and all deposit monies shall be returned to Buyer. If Buyer or Buyer's Agent does not advise Seller or Seller's Agent of receipt of a mortgage commitment acceptable to Buyer on or before the date specified in subparagraph (c) above, then Seller (but not Buyer) shall have the option thereafter and until, but not beyond, the date of receipt of an acceptable
commitment, to declare this Agreement null and void by notice in writing to Buyer or His Agent of his election to cancel and all deposit monies shall be returned to Buyer.
(h.) It is expressly agreed that notwithstanding any other provisions of this contract, the purchaser shall not be obligated to complete the purchase of the property described herein or to incur any penalty by forfeiture of earnest money deposits or otherwise unless the seller has delivered to the purchaser a written statement issued by the Federal Housing Commission setting forth the appraised value of the property (excluding closing costs), which statement the seller hereby agrees to deliver to the purchaser promptly after such appraised value statement is made available to the seller. The purchaser shall, however, have the privilege and option of proceeding with the consummation of the contract without regard to the amount of the appraised valuation made by the Federal Housing Commissioner. The appraised valuation is arrived at to determine the maximum mortgage the Department of Housing and Urban Development will insure. HUD does not warrant the value or the condition of the property. The purchaser should satisfy himself/herself that the price and condition of the property are acceptable. It is expressly agreed that, notwithstanding any other provisions of the contract, the purchaser shall not incur any penalty by forfeiture of earnest money or otherwise be obligated to complete the purchase of the property described therein, if the contract price or cost exceeds the reasonable value of the property established by the Veterans Administration. The purchaser shall, however, have the privilege and option of proceeding with the consummation of this contract without regard to the reasonable value established by the Veterans Administration.
(i) Seller agrees to permit inspections by authorized appraisers and provide certifications as required to obtain FHA-VA ...