Facts

On Dec. 10, 2002, plaintiff FHC Inc. entered into an agreement with defendant Sunnymead Mutual Water Company to purchase four parcels of real property, totaling approximately 10 acres, on the corner of Heacock Street and Ironwood Avenue in Moreno Valley. Under the agreement, FHC would pay $2.2 million for the property. Escrow was opened at Fidelity National Title Company. On March 16, 2004, the parties agreed to reduce the purchase price to $1.8 million and escrow was scheduled to close on or before April 1.

Following several extensions of the closing date, the parties agreed to a closing date. According to plaintiffs counsel, the parties agreed to close escrow on Feb. 7, 2006. According to defense counsel, the agreed upon closing date was Jan. 6, 2006.

On Jan. 18, 2006, the president of FHC, Fred Darryl Howser, informed the president of Sunnymead, Billy Hall, that FHC would be ready to close escrow on Feb. 7. Hall then advised FHC that Sunnymead was not going to move forward with the transaction.

On Jan. 27, 2006, Sunnymead unilaterally attempted to cancel escrow. As of Jan. 27, 2006, Sunnymead had not deposited into escrow the grant deed and any other documents requested by the escrow company.

PLAINTIFF'S CONTENTIONS:
FHC alleged that, after the purchase agreement was entered into, Sunnymead breached the purchase agreement by failing to perform its seller obligations pursuant to the agreement and attempting to unilaterally cancel escrow before allowing FHC an opportunity to perform.

DEFENDANT'S CONTENTIONS:
The defense contended that the time to perform expired on Jan. 6, 2006 and FHC failed to tender payment by that date.

Damages

FHC sought recovery of damages pursuant to Civil Code section 3306.

Result

The court awarded FHC $789,287 in contract damages, deposits, and costs incurred in preparation for the close of escrow.

Other Information

Sunnymead appealed the judgment on Nov. 12, 2009 (Court of Appeal Case No.: E049639). FILING DATE: Feb. 10, 2006.