Brown-Marx Associates, Ltd. v. Emigrant Savings Bank

703 F.2d 1361 (1983)

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Nature of the Case

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Facts

Brown-Marx (P) got a loan commitment from Emigrant (D) for the purchase and renovation of an office building. D had agreed to lend P $1.1 million if P provided satisfactory documentation of renovations and signed leases for at least $714,447 in annual rentals, and an appraisal that the building was worth at least $2.4 million. A floor loan was also provided in the commitment if the major requirements were not met. The floor loan was for $750,000. On these commitments, P obtained construction financing of $1.1 million to be repaid from the D loan proceeds. When the renovations were complete P applied submitted the paperwork for the loan from D. It was found to be flawed and not representative of the true situation at the building. The appraisal was not acceptable, and the rental income and an accounting of the actual leases were not to the levels required. D offered to floor loan. Discussions eventually terminated. P sued for breach alleging substantial performance and P was awarded $543,000 in damages. A new trial was granted, and the court granted summary judgment for D on the breach of contract claim. P appealed.