Crabby’s Inc. v. Hamilton
Missouri Court of Appeals
244 S.W.3d 209 (2008)
- Written by Craig Conway, LLM
Facts
James Hamilton (defendant) executed a contract to purchase Crabby’s, a restaurant owned by Fred and Carolyn Billingsly, owners of Crabby’s, Inc. (collectively, plaintiffs) for $290,000. Hamilton then assigned his interest in the contract to Paragon Ventures, L.L.C. (Paragon) (defendant) (collectively, defendants). The contract contained a provision that required the defendants to use reasonable diligence in obtaining a loan and to provide a written loan commitment within 30 days of obtaining the loan. If the defendants failed to do so, the contract would terminate automatically. The defendants obtained a bank loan but never furnished the plaintiffs with a written loan commitment. Thereafter, a closing date for the transaction was agreed upon, numerous repairs were made to the restaurant, and the plaintiffs started to transfer the utilities into the defendants’ name. Two days prior to closing, Hamilton sent a letter to the plaintiffs stating that the defendants were backing out of the transaction entirely. The plaintiffs sold the restaurant nearly 12 months later for $235,000. The plaintiffs filed suit against the defendants for breach of contract and claimed as damages the difference between the contract price and the sale price. After a bench trial, the court held for the plaintiffs, and the defendants appealed.
Rule of Law
Issue
Holding and Reasoning (Lynch, C.J.)
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