Luttinger v. Rosen

164 Conn. 45, 316 A.2d 757 (1972)



A condition precedent is a fact or event which the parties intend must exist or take place before there is a right to performance.


Plaintiffs contracted to purchase a house owned by defendants and paid a deposit, which was to be returned if plaintiffs were unsuccessful in obtaining financing as provided in the contract. Plaintiffs obtained a mortgage commitment that failed to meet the contract requirement. Plaintiffs gave timely notice to defendants and demanded the return of the down payment. Defendants' counsel offered to make up the difference between the interest rate offered by the bank and the interest rate provided in the contract. Plaintiffs did not accept the offer and sued after defendants refused to return the deposit. Defendants appealed from a judgment rendered in favor of plaintiffs.


Are the buyers entitled to get their deposit back?




In this case, the language of the contract is unambiguous and clearly indicates that the parties intended the purchase of the defendants' property be conditioned on the plaintiffs obtaining a mortgage, as specified in the contract. From the subordinate facts, the court could reasonably conclude that since the plaintiffs were unable to obtain a $45,000 mortgage at no more than 8 1/2 percent per annum interest "from a bank or other lending institution." The condition precedent to performance of the contract was not met, and the plaintiffs were entitled to the refund of their deposit. Any additional offer by the defendants to fund the difference in interest payments could be rejected by the plaintiffs.

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