204 A.3d 515
Pa. Super. Ct.2019Background
- In 2004 Avery agreed to buy the Maisanos' home at 103 Indian Springs Road for $1,350,000 and paid a $150,000 deposit; closing was repeatedly delayed by addenda through 2011 due to Avery's lack of funds.
- Avery and the Maisanos executed a small land swap in 2006; Avery later installed a storm-water system on portions of the Maisanos' land without a written easement (disputed).
- Avery defaulted by failing to close; the Maisanos retained the $150,000 deposit and sued Avery (and nonparty Hamlet Villas, LLC) in 2016 for breach of contract, trespass, and sought specific performance (i.e., purchase price).
- The trial court found Avery breached but awarded only the $150,000 deposit as liquidated damages and $5,000 nominal damages for an irrevocable license for the storm-water system; it excluded evidence about transfers from Avery to Hamlet.
- The Maisanos appealed, arguing contractual right to specific performance (purchase price), improper denial of that remedy, error in creation of an irrevocable license, and erroneous exclusion of transfer evidence.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the contract permits specific performance (purchase price) as remedy | Maisano(s): Agreement allows pursuit of specific performance/purchase price; default clause did not limit remedies because box for liquidated-damages-only was not checked | Avery: courts may deny equitable specific performance when damages are ascertainable; trial court awarded liquidated damages | Court: Contract does not preclude seeking purchase price; seller may demand purchase price as specific performance; remanded for damages trial (reverse limited damages ruling) |
| Whether specific performance is barred because damages are ascertainable | Maisano(s): Specific performance still available for seller seeking purchase price even if amount is ascertainable | Avery: Equitable relief unnecessary where legal damages are adequate and ascertainable | Court: Seller’s claim for purchase price is functionally specific performance; ascertainability does not bar that remedy here; trial court erred in refusing purchase-price damages |
| Whether an irrevocable license arose for the storm-water system | Maisano(s): No license; use exceeded any permission and was tied to a purchase contract rather than a license | Avery: Installation created an irrevocable license; trial court so found | Court: Declined to decide on merits because remand for purchase-price damages makes license ruling immaterial; vacated the $5,000 nominal award |
| Whether evidence of transfers from Avery to Hamlet was admissible to show fraud/alter-ego | Maisano(s): Transfers were made to avoid liability and show alter-ego/fraud; evidence relevant | Avery: Transfers irrelevant to breach action; Hamlet not a contracting party | Court: Evidence exclusion not an abuse of discretion; transfer evidence irrelevant to breach claim (but PUFTA remedies may be available later) |
Key Cases Cited
- Trachtenburg v. Sibarco Stations, Inc., 384 A.2d 1209 (Pa. 1978) (seller's action for purchase price is the functional equivalent of specific performance)
- Appeal of Kaufman, 55 Pa. 383 (Pa. 1867) (equitable principles govern specific performance in real estate contracts)
- Ramalingam v. Keller Williams Realty Group, Inc., 121 A.3d 1034 (Pa. Super. 2015) (principles of contract interpretation and ambiguity)
- Bair v. Manor Care of Elizabethtown, PA, LLC, 108 A.3d 94 (Pa. Super. 2015) (de novo review for contract interpretation legal questions)
- First Nat’l State Bank v. Commonwealth Fed. Sav. & Loan Ass’n, 610 F.2d 164 (3d Cir. 1979) (equitable principles limit availability of specific performance when damages are adequate)