Schieber, Han and Mascia Secure Decisive Appellate Victory in Contract DisputeDecember 20, 2021 |
The Appellate Division, First Department unanimously affirmed a summary judgment order obtained by Evan Schieber and Lawrence Han. Henry Mascia argued the appeal.
Immediately before New York State’s shutdown of non-essential businesses in March 2020, the Firm’s client entered into a contract of sale to purchase a commercial property in Brooklyn for approximately $20 million and paid a $1 million down payment. The seller sought to force a closing on the time is of the essence closing date. When our client refused to close, the seller sought to retain the 1 million dollar deposit. Rivkin Radler was then hired to protect the client’s interest. We argued before the lower court that, it was the seller, who defaulted under the contract by failing to deliver certain tenant estoppel certificates in the form required by the parties’ contract and that it was our client who was not only entitled to the return of the deposit, but to all of its legal fees. The Supreme Court agreed and directed the seller to return the deposit and pay all of the legal fees incurred. The seller thereafter appealed.
In unanimously affirming the Supreme Court’s decision, the First Department agreed that the delivery of the tenant estoppel certificates in the required format was a material term of the contract, which the seller failed to meet. The Appellate Division ordered that the 1 million dollar deposit be released to our client, together with the client’s legal fees. This case will stand as an important precedent for parties to real estate contracts and is a reminded to sellers that they must meet all of the stated obligations outlined in the contract or risk being in default.
- Lawrence S. Han
- Evan R. Schieber
- Henry M. Mascia