Command Security Corp. v. Moffa
84 So. 3d 1097
Fla. Dist. Ct. App.2012Background
- Appellant Command Security paid $800,000 upfront and deposited $400,000 in escrow for Eagle's assets, funding a potential post-closing purchase-price adjustment if assets underperformed.
- The asset purchase agreement allowed an adjustment under Section 2.07, with a 45-day deadline after the Measurement Period end to deliver a proposed statement and a 15-day window to challenge it.
- Measurement Period was defined as the last full calendar month before the first anniversary of closing; here the closing was Sept. 12, 2008, making August 2009 the Measurement Period and Oct. 15, 2009 the initial deadline for the proposed statement.
- Appellant did not deliver the Proposed Statement until November 6, 2009, asserting that revenues were below target and seeking escrow funds, while appellee later invoked its discretion to declare revenues exceeded target due to the late statement.
- The trial court ruled in favor of appellee, but the Fourth District reversed, holding time was not of the essence and appellant’s late submission was not material to the contract’s intent.
- The court remanded to enter summary judgment in favor of appellant, emphasizing that the contract’s express terms and surrounding circumstances did not make the 45-day deadline material.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether time was of the essence for the 2.07 deadline | Command: time not essential; delay was harmless | Moffa: appellee could declare excess due to late statement | Time not of the essence; deadline not material |
Key Cases Cited
- Sublime, Inc. v. Boardman's Inc., 849 So.2d 470 (Fla. 4th DCA 2003) (time is not necessarily of the essence absent express designation)
- Atlanta Jet v. Liberty Aircraft Services, LLC, 866 So.2d 148 (Fla. 4th DCA 2004) (nonperformance on a set closing date did not terminate contract when time was not of the essence)
- Crawford v. Barker, 64 So.3d 1246 (Fla.2011) (clear contract language controls; intent from four corners)
- ADC Orange, Inc. v. Coyote Acres, Inc., 824 N.Y.S.2d 192, 857 N.E.2d 513 (N.Y. 2006) (time concepts depend on reasonable time unless time is of the essence)
- Centurion Air Cargo, Inc. v. United Parcel Serv., Co., 420 F.3d 1146 (11th Cir. 2005) (late payment not per se material breach unless time is of the essence)