Tuesday, December 14, 2021

Antisemitism Of Sellers Impacts Court's Decision On Breach Of Contract

In Extended CHHA Acquisition, LLC v. Mahoney, (NY County Sup. Ct., Dec. 3, 2021) a New York trial court granted buyers specific performance of a multi-million dollar contract to purchase a business which sellers attempted to repudiate in order to obtain a better price elsewhere later. The decision is unusual in that anti-Semitism of the sellers was condemned explicitly by, and figured prominently in, the court's opinion. The court said in part:

To be clear, not only did the Seller breach the Purchase Agreement ..., but also the Seller's principals and their agent-representative ... actively took glee ... in being gratuitously abusive and disrespectful of the Buyer's principals and their religious observance. The degree to which [sellers] ... taunted the Buyer's principals to their face and mocked them behind their back because they are Jewish is horrifying and cannot be overstated. Their bigotry is disgusting and shameful, representing the worst and most depraved behavior that has no place in civilized society....

The record also establishes that the Seller worked in bad faith to prevent the closing..... On March 26, 2021, three days prior to the closing, ... Mr. Shemia called to ask to close on Tuesday, March 30, 2021, rather than March 29, 2021, due to Passover.... Mr. Achilarre refused....

Additionally, the Seller is not entitled to dismissal of the Buyer's cause of action for breach of the covenant of good faith and fair dealing.... [T]he evidence of the insidious antisemitism fueling the breach by the Sellers also makes out a claim for breach of the covenant of good faith and fair dealing.

JD Supra has more on the decision.