Arnhold and Argoudelis farmed 280acres near a fast-growing suburb of Chicago. Th

Question

Arnhold and Argoudelis farmed 280acres near a fast-growing suburb of Chicago. They agreed to sell the land to Ocean Atlantic (Ocean), which planned to develop it into a residential subdivision. The parties agreed to cooperate and make sure that the conditions necessary for the development, such as the property would be annexed and rezoned, would be done before the closing date of November 1, 1997. When that had not happened by the deadline despite their best efforts, they agreed to extend the deadline until January 15, 1999. Ocean met with planning official, but by the fall of 1998, the parties agreed to new date for closing, the final being January 25, 2001. They also agreed to a time-is-of-the-essence clause. On January 18, Ocean sent a letter demanding a new closing date of May and demanding Arnhold and Argoudelis to pay $680,000 in development fees, a new term it introduced then. They refused. On January 25, Ocean failed to tender the $7.26 million at the closing, and the sellers declared the contract terminated. Ocean sued for specific performance. Did Ocean materially breach the contract? Explain.

Explanation / Answer

Basically materiality focuses on two main issues
As one party that is directly fail to perform the contractual duties, part will excuse the other parties performance will excuse the other parties performance.
In this case Ocean Atlantic waited till the end moment to the eleventh hour for getting the specific necessary documents for the loan. This type of approach is directly pointing towards playing with the Fire which mentions that the breach is material.

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