Bleecher v. Conte

29 Cal.3d 345 (1981)

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Nature of the Case

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Facts

In 1977, D bought 40 acres of unimproved land in Palm Desert for $150,000. Approximately one year later, she gave Mr. Gregory Corarito, a licensed real estate salesman, written authorization to act as her agent in locating a buyer for this property. Mr. Corarito contacted potential buyers including another licensed real estate salesman, P. P joined with two associates, Mr. Adeeb Sadd and Mr. George Nigro, contractors involved in real estate development. On September 17, 1978, they prepared a deposit receipt and agreement of purchase and sale form offering $575,000 for the 40 acres. The terms of the offer provided for a $1,000 deposit to open escrow, 29 percent to be paid at the close of escrow, with the remainder to be paid within 5 years. Escrow was scheduled to close on the day after the final tract map was recorded. P agreed to 'do everything in their power to expedite the recordation of the final map and [to] proceed with diligence.' Ps' obligation to pay was contingent upon their approval of the title report, plat map, and soil, zoning, and engineering reports. However, approval could not be unreasonably withheld. The offer form also included a liquidated damages clause limiting the D's remedy to possession of the reports and plans created for the buyers. P rejected the offer and made a signed counteroffer. The counteroffer stated: '[all] of the terms and conditions of the aforementioned Agreement to purchase offer are hereby accepted and shall remain the same with the exception of the following: [para.] 1) Property to be sold for all cash. ($575,000) [para.] 2) D warrants that no less than one hundred and twenty residential units can be constructed on subject property.' D neither questioned nor discussed any other term of the original offer. Ps signed the counteroffer that same day. Ps made a $1,000 deposit into escrow. D refused to sign the escrow instructions or proceed with the agreement unless Ps would pay the entire purchase price before the end of the calendar year. Since that was not part of the agreement, Ps brought suit for specific performance. D argued that she could not be forced to specifically perform because of the nature of the liquidated damages clause and the presence in that clause of one party's waiver of the specific performance remedy precluded, specific performance of the agreement for either party. The trial court rejected that argument and others and entered judgment for Ps. The court ordered D to place the deed to the property in escrow and to sign the escrow instructions. D appealed.