On appeal from Superior Court of New Jersey, Law Division, Middlesex County, Docket No. DC-1513-06.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Weissbard and Graves.
Defendant Latoya Gorrell appeals from an order entered on September 11, 2006, granting summary judgment in favor of plaintiffs Jorge Miranda and Delminda Graca. Defendant contends plaintiffs' summary judgment motion should have been denied because there were genuine issues of material fact that needed to be decided at trial. We agree and therefore reverse.
In October 2005, plaintiffs Jorge Miranda and Delminda Graca (sellers) entered into a written contract with defendant Latoya Gorrell (buyer) for the sale of real property. Plaintiffs agreed to sell property located at 226 Main Street, in the Borough of South River (the property) to defendant for the total sum of $343,500. The contract contained a mortgage contingency clause, indicating the transaction was contingent upon defendant receiving "a written commitment from any recognized lender for a Conventional first mortgage loan on the property in the amount of $274,800 at the prevailing rate of interest." This clause also contained the following language: "If the Buyer cannot obtain a written mortgage commitment by 11/4/05, either party may cancel this Contract of Sale unless there has been a mutual agreement on extending the time."
In their Special Civil Part complaint, plaintiffs state they were "ready and willing" to deliver a deed to defendant on December 9, 2005, in return for payment of the purchase price, but "defendant neglected to comply with the terms of the Agreement on her part, and failed to pay the purchase price." Plaintiffs claimed they suffered the following damages "by reason of defendant's breach": "costs of U-Haul moving truck rentals, cost of movers to empty the house, legal fees and costs, and other damages." In her answer and counterclaim, defendant admitted she entered into a written agreement to purchase the property, but she denied that plaintiffs were "ready and willing" to close title in accordance with the terms of the agreement. Defendant also stated she was "justified in terminating the Contract" and was "excused from performance thereunder" because her mortgage application was denied. Thus, defendant sought "a full refund of all of her deposit monies."
No discovery was conducted by either party, but both parties filed summary judgment motions. The only certifications attached to the summary judgment motions were certifications of counsel, and the attorneys did not agree on the facts. For example, plaintiffs' attorney certified "defendant put down a deposit of $4,000 towards the purchase price," and "defendant represented that she had a mortgage commitment and was ready to close on the closing date of December 9, 2005. The defendant, however, knew as of December 7, 2005[,] that her loan was denied by Countrywide Loans." On the other hand, according to defendant's attorney, defendant "paid the sum of five thousand dollars ($5,000.00) into escrow as a deposit towards the transaction," and "[d]efendant had the right to unilaterally terminate the contract" because defendant "did not procure a mortgage commitment." Additionally, according to defendant's attorney, plaintiffs' claim they were "ready, willing and able" to convey title on December 23, 2005, "was patently false."
When the summary judgment motions were argued, defendant's attorney stressed that either party had an absolute right to cancel the contract because defendant was unable to procure a mortgage commitment by November 4, 2005, the date specified in the mortgage contingency clause. Additionally, defendant's attorney argued plaintiffs were fully aware defendant did not have a mortgage commitment by the November 4, 2005, cut-off date:
The plaintiff[s] knew that we didn't have a mortgage commitment throughout the entire process, and in fact in one of . . . plaintiff's (sic) papers she said that we sent them a -- a what do you call it? A sample HUD, a sample closing statement. Okay? And on there, we sent the sample closing statement with adjustments as to the transaction, but nothing from the bank because we didn't have anything from the bank.
My client was trying in good faith to get this thing to close, and . . . her bank could not get there, and as soon as we got a written denial from the bank, we faxed it over the same day. It was issued I think on December 7th, put in the mail. It came to us on the 14th, and either the 14th or the 15th it was faxed over to [plaintiffs' attorneys'] office.
The fact of the matter is, Your Honor, my client has no . . . ability to purchase this house without the . . . mortgage contingency that she bargained for.
Notwithstanding the lack of discovery and the lack of any affidavits or certifications from the parties, the trial court ruled defendant had breached the contract, and it awarded damages to plaintiffs in the amount of $2,638.18. The trial court's findings included the following:
The defendant did not advise the plaintiff[s] that she . . . did not have a mortgage commitment, and instead represented that she had a mortgage commitment and was ready to close on the closing date of December 9th. However, the mortgage commitment had not been ...