ForeclosuresBorrower Entered Into Settlement Agreement With Lender Which Called for Time of the Essence ClosingBorrower Obtained Loan Commitment to Refinance but Its New Lender Failed to Close on the Time of the Essence DateBorrower’s New Lender Then Changed Its Position and Agreed to Close the Following DayRather Than Enforce the Settlement Agreement With Time of the Essence Provision, Court Vacated the Settlement Agreement and Restored the Matter to the Foreclosure Calendar
In about 2005, “A” executed and delivered a mortgage and note (mortgage) to a bank in the amount of $1.5 million. The mortgage was assigned to “B.” “B” thereafter commenced the instant action to foreclose the mortgage. While the foreclosure was pending, the parties entered into settlement negotiations and signed a written settlement agreement (agreement) whereby “A” was to pay “B” $1.1 million in exchange for “B’s” discontinuance of the foreclosure action. The agreement contemplated that “A” would obtain the $1.1 million settlement amount “through the refinancing of the premises with an outside lender.” The agreement provided that “A” “shall pay ['B']…in full and ['A'] shall close within 90 [ninety] days after this…agreement and Release is…fully executed, but in no event later than November 17, 2011.” The agreement further provided “that ‘[t]ime is of the essence for the closing’ and that [i]f ['A'] fail[s] to perform at closing, then ['A'] shall immediately sign over and deliver the subject deed to ['B']…but in no event later than November 17, 2011.”
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