Scott Mollen, Partner at Herrick, Feinstein LLP

Breach of Contract—Court Granted Seller's Motion for Summary Judgment and Dismissed a Counterclaim—Seller Entitled To Keep $50,000 Deposit Even Though the Contract Lacked a Liquidated Damage Provision

The plaintiff is the former owner of the subject property. In August 2020, the plaintiff contracted to sell the property to the defendant for $655,000. The defendant made an initial deposit of $10,000 and a subsequent deposit of $40,000. The balance of $615,000 was to be paid at the closing.

The contract provided, inter alia, that the plaintiff:

shall convey and defendant shall accept the property subject to all covenants, conditions, restrictions and easements of record and zoning and environmental protection laws so long as the property is not in violation thereof and any of the foregoing does not prevent the intended use of the property for the purpose of a personal residence, also subject to any existing tenancies, any unpaid installments of street and other improvement assessments payable after the date of the transfer of title to the property, and any state of facts which an inspection and/or accurate survey may show, provided that nothing in this paragraph renders the title to the property unmarketable.