| Iannucci v 70 Washington Partners, LLC |
| 2008 NY Slip Op 04653 [51 AD3d 869] |
| May 20, 2008 |
| Appellate Division, Second Department |
| Robert T. Iannucci et al., Respondents, v 70 WashingtonPartners, LLC, Appellant, et al., Defendant. |
—[*1] Kevin J. Farrelly, New York, N.Y. (Jeffrey H. Weinberger of counsel), forrespondents.
In an action, inter alia, for specific performance of a contract for the sale of a condominiumunit, the defendant 70 Washington Partners, LLC, appeals from an order of the Supreme Court,Kings County (Schneier, J.), dated January 19, 2007, which denied its motion for summaryjudgment dismissing the causes of action for specific performance and to cancel the notice ofpendency pursuant to CPLR 6514 (a) or, in the alternative, to cancel the notice of pendency uponthe posting of an undertaking pursuant to CPLR 6515.
Ordered that the order is affirmed, with costs.
On May 31, 2005 the plaintiffs (hereinafter the purchasers) entered into a contract topurchase unit PHJ at 70 Washington Street, Brooklyn, from the defendant 70 WashingtonPartners, LLC (hereinafter the seller), for the sum of $1,530,000. The purchasers paid the seller adown payment of $153,000 upon the execution of the contract. An initial closing date was set forFebruary [*2]27, 2006. In a letter dated February 21, 2006 thepurchasers notified the seller's attorney that the purchaser Sonia O. Ewers examined the propertyon February 9, 2006 and found a number of unsatisfactory items. The letter from Ewers proposedto schedule a new closing date once this second examination took place. The seller's propertymanager invited her to examine the property again.
In a letter dated April 3, 2006 the seller's attorney notified the purchasers they were in defaultfor failing to close on February 27, 2006 and stated that "you may cure your default by closing onThursday, May 4, 2006, at 11:00 a.m.," with time of the essence. The purchasers responded byletter dated April 13, 2006 stating that they were not in default and were willing to close once"the serious deficiencies have been addressed and remedied."
In a letter dated April 27, 2006 the seller's attorney notified the purchasers that the seller"rejected" the assertions made by purchasers in the letter dated April 13, 2006 and advised thepurchasers that "in the event that you fail to attend such closing," scheduled for May 4, 2006 and"tender the balance of the purchase price as required under the Purchase Agreement, our clientshall exercise its rights contained in the Purchase Agreement and offering plan to terminate thePurchase Agreement and return your contract deposit. Please be guided accordingly." On May 3,2006 the purchasers wrote a handwritten statement on the letter dated April 27, 2006, signed byeach of them, stating that they agreed to accept the return of their contract deposit of $153,000,and forwarded that handwritten statement by facsimile transmission to the seller's attorney.
The seller's attorney, by letter dated May 3, 2006, also forwarded by facsimile transmission,informed the purchasers that if they failed to close on the following day, May 4, 2006, at 11:00a.m., their contract deposit would be forfeited.
In response, the purchasers' attorney notified the seller's attorney that the parties had "enteredinto a written agreement, after considerable negotiations, to terminate the Purchase Agreementand refund the contract deposit in the amount of $153,000." Nevertheless, the seller's attorneyheld a "closing," found the purchasers in default, and refused to refund their contract deposit.
Thereafter, the purchasers commenced the instant action, inter alia, to recover their contractdeposit or, in the alternative, for specific performance of the contract of sale. After issue wasjoined, the seller moved for summary judgment dismissing the purchasers' causes of action forspecific performance and to cancel the notice of pendency, on the grounds, inter alia, that thepurchasers were in default of the time-of-the-essence closing date, and that the purchasers wereactually seeking the return of their contract deposit. The seller's attorney claimed that the offer toreturn the down payment, set forth in the letter dated April 27, 2006, was a typographical error.
In opposition, the purchasers stated that once they notified the seller of the defects in theproperty, the seller's sales manager orally offered to return their down payment and terminate thecontract of sale. They claimed that they still wanted to proceed with the purchase, once thedefects were cured, but, upon receipt of the letter dated April 27, 2006 offering return of theirdown payment, they decided it was in their best interests to accept the offer. The purchasersasserted that, once their acceptance of the offer to cancel the contract was rejected, they had nochoice but to sue. The purchasers stated that they were still ready, willing, and able to close oncethe unit was cured of its defects. In support of their claims that there were defects, the purchaserssubmitted an unsworn architects' report.[*3]
The Supreme Court denied the seller's motion. The sellerappeals. We affirm.
The seller failed to establish its entitlement to judgment as a matter of law. Its letter datedApril 27, 2006 apparently gave the purchasers the option of canceling the contract and seekingreturn of their down payment. The purchasers accepted that offer. Since the parties did not movefor summary judgment with respect to causes of action for the return of the down payment, thequestion of whether that agreement was binding is not before this Court on this appeal. However,as a result of the letter dated April 27, 2006, the purchasers were no longer on notice that if theyfailed to close on May 4, 2006 they would be held in default and forfeit their contract deposit.
On May 3, 2006, one day prior to scheduled closing, the seller clarified its position, statingthat the failure to appear at the scheduled closing on May 4, 2006 would constitute a default andresult in forfeiture of the down payment. However, when requiring performance on a specificdate with time of the essence, the seller must give the purchaser reasonable time to perform (see ADC Orange, Inc. v Coyote Acres, Inc.,7 NY3d 484 [2006]; Woodwork Display Corp. v Plagakis, 137 AD2d 809[1988]). A time-of-the-essence letter which does not give the purchaser sufficient time toperform constitutes a nullity (see 3M Holding Corp. v Wagner, 166 AD2d 580 [1990]).In the instant case, the seller did not give the purchaser sufficient time to perform (id.).
Further, since the seller was the party moving for summary judgment, it had the burden ofdemonstrating "the absence of a triable issue of fact regarding whether the plaintiff was ready,willing and able to close" (Knopff vJohnson, 29 AD3d 741, 742 [2006]). The seller failed to meet that burden.
Since the seller failed to establish its entitlement to judgment as a matter of law, we need notconsider the sufficiency of the purchasers' opposing papers.
The seller's remaining contentions are without merit or need not be addressed in light of ourdetermination.[*4]
Motion by the respondents, on an appeal from an order ofthe Supreme Court, Kings County, dated January 19, 2007, inter alia, to strike stated portions ofthe appellant's brief on the ground that they refer to matter dehors the record. By decision andorder on motion of this Court dated November 2, 2007 (2007 NY Slip Op 82772[U]), that branchof the motion was held in abeyance and was referred to the Justices hearing the appeal fordetermination upon the argument or submission thereof.
Upon the papers filed in support of the motion, the papers filed in opposition thereto, andupon the argument of the appeal, it is
Ordered that the branch of the motion which is to strike those portions of the appellant's briefwhich refer to matter dehors the record is granted, and that matter is stricken from the appellant'sbrief and has not been considered on the appeal. Skelos, J.P., Santucci, Balkin and Chambers, JJ.,concur.