Legal Question in Real Estate Law in New York
New York Real Estate Contract Question
I am an attorney representing myself in the purchase of a coop apartment in NYC. The date listing for closing in the contract is 30 days from the date the executed contract is received by the purchaser (me). The contract does not state ''time is of the essence.'' I have informed the seller's attorrney that I will sign the contract but that the closing date is unrealistic and I will need a reasonable adjournment. He responded that if I do not close on the date in 30 days, he will send a letter of default, making time of the essence, and I will then have 10 days to close. In addition, he ssays if I do not close in those 10 days, the seller is entitled to our escrowed deposit. My understanding is that when time is not of the essence (not so stated in the contract), then both parties are entitled to a reasonable adjournment of the closing. My question, then, is two-fold: (1) Can the seller's attorney really enforce a ''time of the essence'' default letter in only 10 days (i.e. void the contract and retain my deposit)? and, if not, (2) What do the courts deem a ''reasonable'' adjournment to mean (I have been assumming 30-45 days). Any guidance would be most appreciated !!
1 Answer from Attorneys
Re: New York Real Estate Contract Question
Designation in a contract of a closing date does not make it "time of the essence". After the time allotted in the contract has passed the seller has the right to issue a Time of the Essence Notice provided that it is reasonable. There is no fixed rule for what is reasonable and it depends on the facts and circumstances. In some cases ten days has been held reasonable and in others, it's not. Good faith, nature and object of the contract, experience of the parties and the original time allocated in the contract are all considered elements by the Courts.
As an aside, if you're getting financing and need board approval the 30 days in the contract is not realistic on the seller's part. Good luck.
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