Magic Carpet Ride v. Rugger Investment Group
Annotate this CaseDefendant-appellant Rugger Investment Group LLC (Rugger) entered into a contract to sell an airplane to plaintiffs-respondents Magic Carpet Ride, LLC (MCR) and Kevin Jennings. Rugger deposited a lien release into escrow eight days after the expiration of a 90-day period in which it was required to do so. The trial court found Rugger could not claim substantial performance because it had violated the plain language of the contract. For that reason, the court granted the motion of MCR and Jennings for summary adjudication of their breach of contract cause of action and for summary adjudication of Rugger’s rescission and breach of contract causes of action. Voluntary dismissal of other causes of action produced an appealable final judgment. The Court of Appeal reversed and remanded, finding that whether Rugger substantially performed its contract obligations was a triable issue of material fact that precluded summary adjudication. "[A] provision in the parties’ contract making time of the essence does not automatically make Rugger’s untimely performance a breach of contract because there are triable issues regarding the scope of that provision and whether its enforcement would result in a forfeiture to Rugger and a windfall to MCR."
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