Time of the Essence Closing: Amazing Preparation, Discovery of Another Home Buyer Purchased Spoiled Chances of Breaching Contract
This case was referenced to us by Seller’s attorney after he had declared “time is of the essence”.
The sale involved an upscale waterfront property in a resort Long Is- land town. At the time the matter was referenced to us, the sale had been ongoing for many months. Purchaser had undertaken a number of inspections and had made two separate demands for a $25,000 abatement of the Purchase Price. The first demand was based on certain physical issues with the house and Seller immediately acquiesced.
The second request was made very late in the process, after Sell- er had already moved out and was based on Seller not having produced various permits from the federal and local authorities for docks and other
beachfront construction. Seller felt strongly that the second request for an abatement was made in bad-faith, particularly in the light of active rumors that Purchaser was bidding on a different waterfront property. Accordingly, Seller refused the second request for an abatement and sent Purchaser a time-of-the-essence notice and asked us to represent Seller at the “closing”.
Adam Leitman Bailey also spoke to buyer’s counsel and explained we had the address of the other house they were buying, and that we had our seller clear up all false claims about the dock to ensure that no is- sues of fact would exist and that this time-of-the-essence closing would be as bullet-proof as a closing could be.
We contacted the local agency in charge of the dock and received a clean bill of health.
In accordance with our usual procedure in such matters, we ordered a court reporter to document proceedings. Before attending the Closing, we conducted detailed research and found two separate statutory provisions giving Seller’s waterfront construction grandfather status, as the docks and related features predated statutory requirements for permits and other consents.
At the Closing, Purchaser’s attorney insisted on production of permits for the docks and walked out when they were not produced. We immediately read into the record the statutory provisions providing grandfather protection. We stated on the record that permits were not required where the statutory provisions legitimized Seller’s waterfront structures. We believe that Purchaser’s review of the transcript, and the fact that no violations existed and the contract had been completed completely, made Purchaser aware that their position was weak and, in a settlement call shortly after the transcript was produced, Purchaser offered forfeiture of a very small portion of the deposit to Seller simply to avoid litigation.