Rescission of Condo Purchase Contract and Refund of Client’s Full Deposit
The sponsor of a newly constructed condominium represented in its offering plan that the First Unit Closing would occur on or about January 1, 2009 and that the First Year of condominium operation would be the twelve-month period beginning as of the First Unit Closing. However, the sponsor experienced continued construction delays, and January 1, 2009 came and went without any closings taking place.
Prior to coming to Adam Leitman Bailey, P.C., the firm’s client had contracted to purchase a condominium apartment from the sponsor. As the months passed without the building receiving its temporary certificate of occupancy, and with closings continually delayed during 2009, he became concerned about the quality of the building’s construction and the viability of the project.
As his concern increased, the client retained Adam Leitman Bailey, P.C. to see if he could rescind his contract and obtain a refund of his deposit.
Adam Leitman Bailey, P.C. reviewed the sponsor’s offering plan and researched the status of the building’s construction. Adam Leitman Bailey, P.C. advised the client that, under the terms of the offering plan, if the building did not receive its Temporary Certificate of Occupancy and if no First Unit Closing occurred by December 31, 2009, the sponsor would be obligated to offer to rescind the purchase contract and return his deposit in full with interest.
On the firm’s client’s behalf, Adam Leitman Bailey, P.C. kept a close watch on the building’s construction status, and, when December 31, 2009 passed without the building receiving its Temporary Certificate of Occupancy, Adam Leitman Bailey, P.C. on the very first business day of 2010, sent the sponsor a letter exercising the firm’s client’s right to cancel the contract and demanding rescission and a full refund of the firm’s client’s deposit.
As a result of Adam Leitman Bailey, P.C.’s prompt action, the sponsor was forced to acknowledge the client’s right to rescission, and the firm’s client received a total payment from the sponsor in the amount of $200,349.38, which was a full refund of his deposit, plus all the accrued interest on his deposit.
This matter was handled by John M. Desiderio and Adam Leitman Bailey, P.C.’s Chair of the firm’s Real Estate Litigation Practice Group.