This dispute arises out of a contract of sale between defendants (hereinafter the sellers) and Z/Z Development Corporation (hereinafter the buyer),
On October 7, 1989, the parties signed a modification agreement giving the buyer an additional year, from that date, to acquire the approvals; the modification stated that the closing was to occur within 30 days of receipt of the approvals, but "in any event * * * no later than [Oct. 7, 1990]". It also provided for, and the buyer made, an additional $80,000 deposit, $50,000 of which was to be nonrefundable, except in the case of a breach by the sellers.
The sellers contend that the contract modification imposed an absolute duty on the buyer to close on October 7, 1990, regardless of whether it had obtained the approvals and, further, that if the contract continued to remain contingent on plaintiff securing the approvals, that it did not do so with due diligence. Plaintiff, on the other hand, maintains that the modification merely changed the time limit for acquiring the approvals and that it did not alter the basic contingency clause of the principal contract. It is plaintiff's claim that because the approvals, though diligently pursued, had not been obtained by the date established for closing, the buyer was excused from performance and is entitled to the return of its deposit.
It is apparent from a reading of the contract modification, which extended the buyer's time to acquire the necessary approvals, that it did not eliminate the provision in the principal contract making the sale contingent on acquisition of those approvals. Significantly, the modification, which specifically identified every change that it effected in the principal contract, did not mention the paragraph containing the contingency clause. Although the modification did state that "in any event" the closing would take place on or before October 7, 1990, this is the same language found in the principal contract; hence, it cannot be said to be incompatible with the contingency provision. Moreover, of the $80,000 paid by the buyer pursuant to the modification agreement, only $50,000 was to be nonrefundable, leaving the remaining $30,000, by implication, as a refundable deposit. This, too, indicates that the parties were aware that the sale might
As the modification agreement did not remove the contingency allowing the buyer to be relieved of its obligation to close if it did not obtain all the approvals, the buyer cannot be faulted for not attending the closing unless it failed to use due diligence in seeking the approvals (see, Blask v Miller, 186 A.D.2d 958). Whether due diligence was indeed lacking on the buyer's part, as the sellers' affidavits insinuate, raises a triable issue of fact precluding summary judgment.
Ordered that the order is affirmed, without costs.