Karll v. Minot Light Inc.
Karll v. Minot Light Inc.
Opinion of the Court
On September 22, 1986, the plaintiffs (buyer) and defendant (seller) entered into a purchase and sale com tract for the “Minot Light Inn” in Scituate, which consisted of a restaurant and lounge. The contract was subject, among other things, to the transfer of applicable licenses to the new owner. The purchase price was stated thus: “$800,000 of which $25,000 has been paid as a deposit this day and
In October, 1986, the buyer, through Minot Beach Club, Inc., a nominee, joined with the seller in applying to the Licensing Board of Scituate to approve a transfer of the seller’s liquor license to the nominee. Approval was not forthcoming until December 8 or 9, 1986. Further approval was needed from the State Alcoholic Beverages Control Commission (ABCC).
Meanwhile the contract closing date of November 22, 1986, had been extended at the buyer’s prior request to December 19.
On January 13, 1987, the seller was informed by the Department of Revenue that the department had filed a protest
On January 14, 1987, the real estate broker in the transaction informed the buyer that the seller considered the buyer to be in default under the contract and that it was entitled to the $25,000 of liquidated damages. On February 19, 1987, the seller’s attorney verified that this sum, held as an escrow, had been paid over to the seller.
The ABCC notified the seller on March 9, 1987, that the protest of the Department of Revenue remained unresolved; if it was not disposed of by April 14, 1987, the ABCC would deny the license transfer.
On April 29, 1987, the buyer filed the present action against the seller to recover the $25,000. Upon materials establishing the facts as recounted above, a judge of the Superior Court allowed the buyer’s motion for summary judgment and later denied the seller’s motion to alter judgment. The seller appeals from these dispositions. We reverse and direct the entry of judgment for the seller (defendants) pursuant to Mass.R.Civ.P. 56(c), 365 Mass. 824 (1974) (on motion for summary judgment, judgment in proper cases may go against the moving party).
The judge thought the seller on the closing date, December 24, 1986, stood in default of an obligation to have the liquor license transferred to the buyer on or before that date; as the seller was not ready, able, and willing to accomplish this, the buyer was excused from tendering the purchase price; consequently the seller had no basis for retaining the sum held as an escrow. We reach a contrary result on two lines of thought.
(2) We have assumed for our first point that there was an obligation to get the license transferred to the new owner by the closing date. However, the contract reads differently — it envisages that the clearing up of a license may be delayed for some period of time beyond the closing date when the deed is' intended to pass against payment of $750,000. This reading
The judgment is reversed. Judgment is to be entered for the seller.
So ordered.
According to the seller, the buyer’s attorney said that this delay was due to an irregularity in the nominee’s application to the licensing board.
The reason appears to have been lack of funds. The seller’s clerk states in his affidavit that buyer’s representative admitted that the buyer could not close because of lack of funds, and seller’s attorney swears that this admission was later confirmed by the buyer, the plaintiff Karll. The buyer does not meet this evidence. He never alleges his readiness to perform but chooses rather to charge that “defendant [seller] has not satisfied his obligations.” The record contains buyer’s refusal of a request for admission that the buyer failed to tender the purchase price, but this appears to have been pro forma. Cf. Mass.R.Civ.P. 56(e), 365 Mass. 825 (1974); 10A Wright, Miller & Kane, Federal Practice & Procedure § 2739, at 521-522 (1983).
The documents were: certificate of good standing (dated December 22, 1986), releases of meal, withholding, and room tax liens (undated, releasing liens of August 20 and November 5, 1986), and waiver of corporation excise tax lien (dated December 23, 1986).
The record does not state the exact ground on which the Department of Revenue acted. See the various recourses available to the department under G. L. c. 62C, §§ 47A, 50, 53, 54; Caposella v. Commissioner of Rev., 26 Mass. App. Ct. 359, 362, 363 n. 9 (1988). In the present case it seems a prior license holder, which merged with the seller, was in arrears.
The analogy is close: the liquor license is in essence part of the property bargained for and the departmental protest may be considered a cloud on the title to the license. Cf. Caposella v. Commissioner of Rev., 26 Mass. App. Ct. at 360.
The legal proposition we have stated and exemplified is not put in doubt by the plaintiff-buyer’s cited cases, Greenberg v. Lannigan, 263 Mass. 594 (1926); Vander Realty Co. v. Gabriel, 334 Mass. 267 (1956); Siegel v. Shaw, 337 Mass 170 (1958). All involved contract breaches, apparent at closing time, and evidently not curable by the seller.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.