DELTA MOBILE HOMES, INC., A FLORIDA CORPORATION, APPELLANT,
v.
ROBERT B. EHMANN, APPELLEE
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Delta Mobile Homes sold property to Ehmann under a contract requiring Ehmann to secure financing. When Ehmann could not meet the closing deadline, the parties amended the agreement. Delta's agent then took Ehmann's development plans ostensibly to consult with an architect, but Delta later sold the property to another buyer and refused to return Ehmann's $20,000 deposit. The court affirmed judgment for Ehmann, holding that Delta's actions prevented Ehmann from obtaining financing and thus Delta could not forfeit the deposit.
A seller is not entitled to forfeit a purchaser's deposit without giving the purchaser a reasonable opportunity to close the transaction, particularly when the seller's actions prevent the purchaser from securing the required financing. The trial court correctly found that Delta's actions in taking Ehmann's plans and specifications warranted denying Delta's forfeiture of the deposit.
[1] A seller's actions that prevent a purchaser from obtaining financing may preclude the seller from retaining a deposit upon default.
[2] A seller's agent who attempts to assist a purchaser in securing financing may be deemed to have waived strict adherence to the original closing date.
Previewing 2 of 4 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“Ordinarily, a purchaser in default cannot recover a deposit. Beatty v. Flannery, Fla.1950, 49 So. 2d 81; Williams v. Crouch, Fla.1966, 186 So. 2d 491; Satchell v. Van Brode, Fla.App.1971, 248 So. 2d 245. And, where time is of the essence in a contract, no notice of default is required... However, there are exceptions to this rule.”
Establishes the general rule against recovery of deposits by defaulting purchasers but recognizes exceptions to that rule.
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Join FLexlaw to unlock all legal intelligenceDelta Mobile Homes and Ehmann entered into a real estate purchase agreement with a $20,000 deposit. When the original closing date could not be met, t…
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By this appeal the defendant in the trial court seeks review of an adverse final judgment. The appellee, as purchaser, and the appellant, as seller, entered into an agreement for the purchase and sale of real property. A $20,000.00 deposit was put up in accordance with the agreement with a third party. When it became apparent that the contract would not be closed within the time provided, the parties modified the original written agreement by subsequent letter, calling for the transfer of the $20,000.00 deposit to the seller and providing certain other conditions, the principal one being that the purchaser would secure certain financing.
Thereafter, both prior to the date set for closing in the amended agreement and subsequent thereto, an executive of the selling concern attempted to assist the purchaser in securing the financing. To this end, he took from the purchaser certain documents, including proposed plans for development of the unimproved property [which was the subject matter of the contract]. Ostensibly, he took these plans for the purpose of consulting with the architect for the seller. At no time did those persons representing the seller indicate that they considered any of the contracts or extensions thereof in default. To the contrary, by the actions of the representatives of the *270seller they were attempting to assist the purchaser in closing the matter and, in fact, by removing from the possession of the purchaser the plans and other papers pertaining to the proposed improvement, they prevented the purchaser from even attempting to obtain financing because it was without the documents to show to any prospective lender what it intended to build. Upon the purchaser seeking to secure the return of its plans, it was notified that the seller had sold the property to another, the seller refused to return the $20,000.00 deposit, and the instant action ensued. Judgment was for the plaintiff and this appeal ensued. We affirm.
Ordinarily, a purchaser in default cannot recover a deposit. Beatty v. Flannery, Fla.1950, 49 So.2d 81; Williams v. Crouch, Fla.1966, 186 So.2d 491; Satchell v. Van Brode, Fla.App.1971, 248 So.2d 245. And, where time is of the essence in a contract, no notice of default is required. Baroudi v. Hales, Fla.App. 1957, 98 So.2d 515; Herrera Y Nogueira v. Helker, Fla.App.1962, 139 So.2d 895. However, there are exceptions to this rule. Beatty v. Flannery, supra; Goldfarb v. Robertson, Fla. 1955, 82 So.2d 504; Baroudi v. Hales, supra; Williams v. Crouch, supra. The trial judge found, and we agree, that the actions of the agent of the seller were such as to warrant the finding that the seller was not entitled to forfeit the deposit without giving the purchaser a reasonable opportunity to close the transaction. Chabot v. Winter Park Company, 34 Fla. 258, 15 So. 756; Asia v. Hiser, 38 Fla. 71, 20 So. 796; Felt v. Morse, 80 Fla. 154, 85 So. 656; 33 Fla.Jur., Vendor and Purchaser, § 54. This is particularly true in light of the fact that, by taking the proposed plans and specifications from the purchaser, the seller prevented the purchaser from seeking the adequate financing to close the transaction.
Therefore, the judgment here under review be and the same is hereby affirmed.
Affirmed.
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Citator
Cited By
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Rybovich Boat Works, Inc. v. Atkins, 587 So. 2d 519 (Fla. 4th DCA 1991)…ncel the contract if the buyer were unable to timely demonstrate an ability to purchase.” Garcia v. Alfonso, 490 So. 2d 130, 131 (Fla. 3d DCA 1986). Where time is of the essence no notice of a default is required. Delta Mobile Homes, Inc. v. Ehmann, 275 So. 2d 269 (Fla. 3d DCA 1973). In this case the time of the essence provision in the contract clearly required the buyer to set a date and time for closing. When the buyer failed to set the closing date and failed to close by the latest date called for in the…
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Butler v. The Keyes Co., 385 So. 2d 9 (Fla. 3d DCA 1980)…s based on their above breach of said contract. Shaw v. Shaw, 334 So. 2d 13, 16 (Fla.1976); Goldfarb v. Robertson, 82 So. 2d 504 (Fla.1955); Bruce Builders, Inc. v. Goodwin, 317 So. 2d 868 (Fla. 4th DCA 1975); see Delta Mobile Homes, Inc. v. Ehmann, 275 So. 2d 269, 270 (Fla. 3d DCA 1973).…
Authorities Cited
- Cilabot v. The Winter Park Co., 34 Fla. 258 (Fla. 1894)
- Felt v. Morse, 80 Fla. 154 (Fla. 1920)
- Goldfarb v. Robertson, 82 So. 2d 504 (Fla. 1955)
- Beatty v. Flannery, 49 So. 2d 81 (Fla. 1950)
- Sim Asia v. Hiser, 38 Fla. 71 (Fla. 1896)
- Nogueira v. Helker, 139 So. 2d 895 (Fla. 3d DCA 1962)
- Ellis Satchell v. VAN Brode, 248 So. 2d 245 (Fla. 3d DCA 1971)
- Baroudi v. Freeman Hales and Elizabeth J. Hales, 98 So. 2d 515 (Fla. 3d DCA 1957)
- Jeffres v. Stone, 186 So. 2d 491 (Fla. 1966)
- Williams v. Crouch, 186 So. 2d 491 (Fla. 1966)