On appeal from the Superior Court of New Jersey, Law Division, Somerset County, L-511-05.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted September 11, 2007
Before Judges Fuentes and Chambers.
In this real estate contract case, the purchasers appeal from the order of judgment entered against them on the counterclaim. They challenge both the adverse determination on liability and the quantum of damages awarded. The purchasers had fixed a closing date, making time of the essence. When the sellers failed to close on that date, the purchasers declared the sellers in breach and terminated the contract. On cross motions for summary judgment, the trial court found that, under the circumstances, the time of the essence closing date fixed by the purchasers was unreasonable. We agree. As a result, the purchasers did not validly terminate the contract; rather they breached the contract when they, thereafter, refused to close. The amount of damages awarded to seller Johnathan Kelly Wilson by the trial court, after holding a plenary hearing, is supported by the law and evidence. We affirm.
This lawsuit arises out of a contract dated July 27, 2003, in which plaintiffs, William G. Farnella and Shirley C. Farnella, (the purchasers) contracted to buy the home of defendants, Renee Brana and Johnathan Kelly Wilson, (the sellers), located at 52 Titus Road, Montgomery, New Jersey. The contract price was $750,000, which included a $75,000 deposit.
Since the purchasers had children of school age, they wanted to close on the transaction by the beginning of the school year. As a result, the purchasers initially wanted a closing date of August 23, 2003. The sellers negotiated for a later date, so that September 5, 2003, was fixed as the closing date in the contract. It was not a time of the essence closing date.
At the time the contract was executed, the sellers, Brana and Wilson, were divorced. Brana was still living in the house; Wilson was not. Under their property settlement agreement, Wilson was obliged to pay to Brana the carrying costs on the home plus alimony, in the amount of $400 per week, until the house was sold and the closing took place.
Prior to the contractual closing date of September 5, 2003, counsel for the parties engaged in correspondence regarding a variety of issues, including the matter of a few dead trees and dead tree limbs on the property. All of the issues were resolved prior to September 5, 2003, with the exception of the dead trees and limbs. The buyers had requested that the dead trees and limbs be removed; by letter dated September 3, 2003, the sellers offered to provide a closing credit of $1,000 for this item.
On September 5, 2003, when the sellers were not ready to close, the purchasers' counsel sent the sellers' attorney a letter fixing September 15, 2003, at 3:00 p.m., as the new closing date and making time of the essence.
As the parties moved toward a September 15, 2003, closing, the dead tree and tree limb issue remained unresolved. The purchasers' attorney sent a fax, dated September 11, 2003, to the sellers' attorney indicating that the $1,000 credit was not satisfactory and that the purchasers wanted the dead trees and limbs removed prior to closing.
By a faxed letter dated September 12, 2003, the sellers' attorney advised the purchasers' counsel that Brana had movers scheduled to begin removing her personal property at 8:00 a.m. on September 15, 2003, and that the house would be fully vacant by the end of that day. As a result, without waiving any right to object to the time of the essence notification, the sellers' attorney requested that the closing be delayed by 24 hours, so that the closing would take place on September 16, 2003. His letter also indicated that the sellers still had not received a final payoff amount for a judgment on the property, that the discharge of a prior mortgage still had not been received from the bank, and that the sellers were contacting a landscaping company to remove the trees and limbs, as requested by the purchasers. The purchasers refused to grant this one day extension.
When the closing did not take place on September 15, 2003, the purchasers, through counsel, sent the sellers' attorney a letter, dated September 16, 2003, declaring that the sellers were in default of the contract for not closing on the 15th, canceling the contract and demanding return of the deposit monies. By letter dated September 16, 2003, sellers' attorney indicated that sellers were ready willing and able to close that day. However, the discharge of the prior mortgage was not obtained until September 17, 2003. On September 18, 2003, sellers' attorney advised the purchasers' attorney by letter that the property had been vacated on September 15, 2003, that all the lien issues were resolved, and that his clients were making every effort to remove the dead trees and tree limbs.
The sellers' attorney then sent out a letter on September 19, 2003, making October 6, 2003, a time of the essence closing date. When the closing did not take place on that date, sellers' attorney sent to purchasers' counsel a letter dated ...