MICHAEL J. RAFTOGIANIS v. JOHN SCHMUCKLER et al.

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-1870-04T51870-04T5

MICHAEL J. RAFTOGIANIS,

Plaintiff-Appellant,

v.

JOHN SCHMUCKLER and HEATHER

HOFFMAN,

Defendants-Respondents.

____________________________________

 

Argued October 6, 2005 - Decided

Before Judges Conley and Weissbard.

On appeal from the Superior Court of New Jersey, Chancery Division, Atlantic County, docket no. ATL-C-160-04.

Salvatore Perillo argued the cause for appellant (Perskie Nehmad & Perillo, attorneys; Mr. Perillo, on the brief).

Gerald Corcoran argued the cause for respondent (Youngblood, Corcoran, Lafferty & Hyberg, attorneys; Mr. Corcoran, on the brief).

PER CURIAM

Plaintiff, Michael J. Raftogianis, appeals the dismissal of his complaint seeking specific performance of a contract for the sale of residential property based upon his failure to obtain a written commitment of mortgage financing as required by the contract. We affirm.

At the time of the execution of the contract, both plaintiff and defendant sellers were represented by separate counsel. The contract was executed on June 25, 2004. The purchase price was $1,300,000. Critical to the appeal before us, the contract included a mortgage contingency clause. Pursuant thereto, plaintiff agreed to obtain a written mortgage commitment for a mortgage in the amount of $975,000 by July 16, 2004. Specifically, the mortgage contingency clause provided that:

This agreement is contingent upon the Buyer obtaining a conventional mortgage at an interest rate not to exceed 5.75% Non Conforming 3/1 ARM, interest only or any mortgage acceptable to Buyer. The Buyer agrees to make written application for such financing and to pay [sic]. If a written mortgage commitment is not obtained by July 16, 2004, either Buyer or Seller may cancel this agreement and the deposit money will be returned to Buyer.

[Emphasis added.]

On July l5, 2004, plaintiff and defendants executed a letter amendment to the contract which extended the mortgage commitment date of July 16, 2004, to July 30, 2004. Plaintiff's broker confirmed this extension by letter to the defendants' broker dated July 19, 2004, stating: "Just a little note so we are all on the same page, all parties have agreed to extend the mortgage commitment date to July 30, 2004."

Apparently, plaintiff could not obtain a mortgage commitment by that date. By letter dated July 30, 2004, he advised his broker that he was "forced to waive the mortgage contingency provision . . . ." This was conveyed to the sellers who rejected plaintiff's efforts to waive the contingency and cancelled the contract.

Plaintiff then filed his specific performance complaint. At the same time, he filed an order to show cause and notice of lis pendens. After defendants answered, they moved to dismiss and discharge the lis pendens. The motion judge granted the relief, concluding that plaintiff could not unilaterally waive the mortgage contingency clause. In this respect, he said:

The discussion of the rights of the parties under mortgage contingencies is laid out in Friedman v. Chopra, 220 N.J. [Super.] 546 [(App. Div. 1987), certif. denied, 110 N.J. 164 (1988)]. It is Judge Brody's decision of 1987 and, certainly, it says that mortgage contingencies, although generally for the protection of the buyer and therefore waivable by the buyer, may also serve the interest of the seller by insuring that the transaction will in fact go forward. If it is for the seller [and where] parties manifest that [intent], there is nothing wrong with providing that a seller may terminate the agreement, and that is in fact what occurred here. The bottom line, while the buyer may waive his rights under a mortgage contingency, the buyer has simply no right to require the seller to waive rights that the contract had reserved to the seller.

In denying plaintiff's motion for reconsideration, the judge added:

I remain convinced that the language in Friedman v. Chopra, [supra,] 220 N.J. Super. 546 . . . which I read as requiring a determination that neither party here could unilaterally waive the mortgage contingency agreement, even if dicta is an appropriate statement of the law, and to the extent that I'm required to indicate that I adopt that statement as the law in this case, there being no prior determination, I reaffirm my belief that the decision is correct[.]

. . . .

There is no basis, so far as I can determine, in law or in equity, to permit the buyer to remove the rights which the seller had bargained for and reduced to writing in the agreement. Since the seller had the right to terminate the contract, the buyer retains no rights.

We agree.

Of course, a trial judge should not rewrite a contract or give a party a better contract than what was expressly bargained for. Solondz v. Kornmehl, 317 N.J. Super. 16, 21 (App. Div. 1998) (citing Hartford Fire Ins. Co. v. Riefolo Constr. Co., Inc., 161 N.J. Super. 99, 114 (App. Div. 1978), aff'd, 81 N.J. 514 (1980)). "Plaintiff is bound by the deal he made. This court may not relieve plaintiff from the hardship that might have been guarded against. We must enforce the contract which the parties themselves have made." Id. at 22 (citing Kampf v. Franklin Life Ins. Co., 33 N.J. 36, 43 (1960)). The court cannot make a better contract for the parties by "supply[ing] terms that have not been agreed upon." Graziano v. Grant, 326 N.J. Super. 328, 342 (App. Div. 1999).

The mortgage contingency clause here is clear. It requires plaintiff to obtain "conventional mortgage at an interest rate not to exceed 5.75% Non Conforming 3/1 ARM, interest only or any mortgage acceptable to Buyer" and further expressly provides that "if such a written mortgage commitment is not obtained by July 16, 2004, either Buyer or Seller may cancel this agreement and the deposit money will be returned to Buyer." (Emphasis added).

Plaintiff, simply put, was not able to satisfy this contingency. His effort to unilaterally waive the contingency ignores the plain language of the mortgage contingency clause, which granted either party the right to terminate if the mortgage commitment was not timely obtained. Because defendants never agreed to waive the mortgage contingency clause, and, indeed, had a contractual right to insist on it, plaintiff could not, unilaterally, do so. Friedman v. Chopra, supra, 220 N.J. Super. at 549. Cf. Davis v. Strazza, ___ N.J. Super. ___, ___ (App. Div. 2005) (real estate contract expressly contingent upon buyer obtaining a mortgage contingency and expressly providing that either buyer or seller could cancel the contract if a written commitment was not obtained by a specific date, later extended by agreement, could be cancelled by buyer where the mortgage commitment that was obtained was conditional).

We reject plaintiff's contention that defendants did not have the right to terminate the contract at the expiration of the mortgage contingency period because neither the mortgage contingency clause nor the contract had a time-of-the-essence provision. Where the time period during which a buyer can obtain a mortgage commitment is limited, "[t]he provision that the contract could be cancelled if that deadline was not met expressly made time of the essence." Schultz v. Topakyan, 193 N.J. Super. 550, 553 (App. Div. 1984). "[A]lthough a mortgage contingency clause primarily protects buyers, the deadline for obtaining the mortgage protects sellers and is therefore of the essence of the contract." Friedman v. Chopra, supra, 220 N.J. Super. at 549 (citing Schultz v. Topakyan, supra, 193 N.J. Super. at 553)).

 
Affirmed.

In addition to the mortgage contingency, the contract was also contingent upon an appraisal of the property at least equal to the purchase price. Such an appraisal had not been obtained by July 30, 2004.

(continued)

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A-1870-04T5

October 19, 2005