NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Axelrad and Sapp-Peterson.
On appeal from the Superior Court of New Jersey, Law Division, Hudson County, Docket No. L-1205-11.
William N. Dimin argued the cause for appellant (Spector & Dimin, P.A., attorneys; Mr. Dimin and Michelle Joy Munsat, on the brief).
Patrick J. Perrone argued the cause for respondent (K & L Gates, L.L.P., attorneys; Mr. Perrone, of counsel and on the brief; Loly G. Tor, on the brief).
Plaintiff appeals from the trial court order setting aside the arbitrator's award finding that she was entitled to the return of her deposit in this failed real estate transaction. We affirm.
In November 2006, plaintiff entered into a contract with defendant to purchase a luxury condo unit for $1,995,000, new construction scheduled to be completed in two years. Simultaneously with the execution of and in accordance with the contract, plaintiff gave deposit monies to defendant's attorney totaling $299,250. During the attorney review period, plaintiff's attorney forwarded correspondence dated December 8, 2006, advising defendant's counsel that plaintiff "disapprove[d] of the [c]ontract in its entirety[,] but also indicating that plaintiff would agree to the terms of the contract provided certain amendments were included. Among the proposed amendments was the following provision:
The [b]uyer agrees to make a good faith effort to obtain a conventional first mortgage loan at the prevailing rate in an amount not to exceed [eighty-five percent] of the purchase price. If the [b]uyer has not obtained [her] written mortgage commitment within (90) days from the conclusion of attorney review, the [b]uyer or [s]eller may terminate the contract and all deposit monies will be promptly returned.
Plaintiff also insisted that the agreement eliminate all references to "[t]ime of the [e]ssence" but agreed that in the event defendant would "ultimately declare a [t]ime of the [e]ssence closing date, then [defendant] may impart monetary penalties for the [b]uyer's failure to close title as set forth in the [p]urchase [a]greement." Defendant agreed to these proposed changes and the parties finalized the agreement.
Notwithstanding plaintiff's insistence upon the ninety-day mortgage contingency clause, she made no effort to obtain a mortgage during this time period. On March 31, 2009, defendant notified plaintiff that closing would take place on April 20, 2009. In an April 3 letter, plaintiff's attorney advised defendant "[his] client [was] very much interested in moving forward with the transaction if she can be provided with financing." He also indicated that defendant "still [had] not responded to [his] request for lenders who will provide financing." Plaintiff failed to appear at the closing as scheduled. When defendant refused to return the deposit, she instituted an action, first in the Law Division. However, because the contract called for binding arbitration, the parties, by consent order, dismissed the action.
The parties proceeded to arbitration. At its conclusion, the arbitrator ruled: (1) "both parties knew or should have known that financing could not be finalized in the ninety (90) day time limit"; (2) plaintiff "used her reasonable best efforts, but failed to obtain a mortgage commitment" when the time came for closing; (3) market conditions had changed; and
(4) both parties acted in good faith. Based upon these findings, the arbitrator concluded plaintiff was entitled to the return of her deposit.
Defendant filed a motion to vacate the arbitration award. Plaintiff filed an order to show cause seeking confirmation of the award. The court ...