Adam Leitman Bailey, P.C. Saves Client’s Contract Deposit and Forces Sale After Court Grants Preliminary Injunction
The purchaser, who was initially represented by different legal counsel at the outset of the transaction, entered into a contract of sale for the apartment with the seller (also the sponsor of the subject building) that provided the purchaser with a funding contingency whereby in the event purchaser’s lender did not fund purchaser’s loan, the purchaser was able to cancel the contract and seek the return of the contract deposit.
The parties mutually agreed to adjourn the closing after the purchaser’s lender refused to fund the purchaser’s loan as a result of an open New York City Department of Building’s (“DOB”) permit. After several adjournments of the closing, the seller believed he could resell the premises to a third-party for a substantially higher amount, and thus, erroneously attempted to hold the purchaser in default of the contract by alleging the purchaser failed to timely close under the terms of the contract and advised the purchaser’s prior counsel that seller elected to retain the contract deposit as liquidated damages.
Within hours of being retained, Adam Leitman Bailey, P.C. sent seller’s counsel a letter (i) vehemently objecting to the seller’s retention of the contract deposit, and (ii) unilaterally designating a “time of essence” closing date within thirty (30) days thereof.
The seller failed to timely close pursuant to the terms of Adam Leitman Bailey, P.C.’s letter, and as a result, Adam Leitman Bailey, P.C. attorneys promptly commenced an action in New York Supreme Court seeking to declare the seller in breach of the contract and for specific performance. Just seven weeks after commencing the action, the court granted the purchaser’s motion for a preliminary injunction, thereby prohibiting both the release of the contract deposit to the seller and the sale of the premises to a third-party pending resolution of the action.
Within days of receiving the favorable decision from the court, the parties agreed to settle the case and promptly closed the sale based upon the originally contracted sale price. The Transactional Group at Adam Leitman Bailey, P.C. handled the successful closing.
Adam Leitman Bailey and John M. Desiderio were the prevailing parties of Litigation. Jacques Erdos and Andrew C. Jorges of the Transactional Group conducted the closing.