2014 UT App 194

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THE UTAH COURT OF APPEALS

LOAD ZONE MARKETING AND MANAGEMENT, LLC,

Plaintiff and Appellant,

v.

C. DENNIS CLARK,

Defendant and Appellee.

Opinion

No. 20130093-CA

Filed August 14, 2014

First District Court, Logan Department

The Honorable Clint S. Judkins

No. 110102378

Judson T. Pitts, Attorney for Appellant

James T. Burton and Joshua S. Rupp, Attorneys

for Appellee

JUDGE STEPHEN L. ROTH authored this Opinion, in which JUDGE 

JOHN A. PEARCE and SENIOR JUDGE PAMELA T. GREENWOOD

concurred.

1

ROTH, Judge:

¶1 Load Zone Marketing and Management, LLC (Load 

Zone) sued C. Dennis Clark for specific performance of a real 

estate purchase contract (the REPC). The REPC implemented a 

common feature of standard real estate purchase contracts in 

 

1. The Honorable Pamela T. Greenwood, Senior Judge, sat by 

special assignment as authorized by law. See generally Utah Code 

Jud. Admin. R. 11-201(6).
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Utah, providing each party the right to cancel in the event Clark 

was unable to obtain a mortgage loan before a specified date. 

Clark’s lender did not approve his loan application before the 

deadline, and Clark canceled the agreement. Load Zone argues 

that even though Clark was unable to get a loan before the 

deadline, his cancellation was ineffective because he cancelled 

the contract for an improper reason and his cancellation notice 

was both untimely and inconsistent with the terms of the REPC. 

The district court granted summary judgment in Clark’s favor, 

concluding that he gave adequate notice and that because he had 

a valid reason to terminate the contract, his motives for doing so 

were irrelevant. We affirm the district court’s ruling.

BACKGROUND

¶2 In August 2010, Clark entered into the REPC with Load 

Zone to purchase property in northern Utah for $1.128 million, 

$846,000 of which was to be financed by a loan. Clark deposited 

$3,000 in earnest money. The REPC was a standard-form realestate purchase contract in which the parties had selected the 

option invoking the ‚Financing Condition‛: ‚*Clark+’s obligation 

to purchase the property . . . [X] IS . . . conditioned upon [Clark] 

obtaining the Loan referenced in Section 2(b).‛ According to the 

financing condition, Clark agreed to obtain financing by 

September 10, 2010, the Financing and Appraisal Deadline (the 

financing deadline), and the parties agreed to close the 

transaction within four days of September 20, 2010, the 

settlement deadline. The Financing Condition required Clark ‚to 

work diligently and in good faith to obtain the Loan‛ and 

allowed either party the option to cancel the REPC if Clark was 

unable to secure a loan by the financing deadline. Should the 

cancellation option be exercised, Clark’s earnest money deposit 

was to be released to Load Zone, who ‚agree*d+ to accept as *its+ 
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20130093-CA 3 2014 UT App 194

exclusive remedy, the Earnest Money Deposit . . . as liquidated 

damages.‛2

¶3 There is no dispute that Clark ‚work*ed+ diligently and in 

good faith to obtain the Loan‛ as the Financing Condition 

required, but his lender had not yet made a decision on Clark’s 

loan application when the financing deadline passed. The 

settlement deadline also went by without any action from 

Clark’s lender, and the REPC did not close. One month later, 

Load Zone sent Clark a proposed addendum to the REPC that 

would have extended the settlement deadline until October 22, 

2010, but Clark did not sign it. The lender finally approved 

Clark’s loan ‚*o+n the evening of October 21st or the morning of 

October 22nd,‛ within days after Load Zone had asked Clark to 

 

2. The cancellation provision is set forth at section 8.3(b) of the 

REPC:

(b) Buyer’s Right to Cancel After the Financing & 

Appraisal Deadline. If after the expiration of the 

Financing and Appraisal Deadline . . . [Clark] fails 

to obtain the Loan, meaning that the proceeds of 

the Loan have not been delivered by the Lender to 

[Load Zone] or to the escrow/closing office [within 

four days of the settlement deadline], then [Clark] 

or [Load Zone] may cancel the REPC by providing 

written notice to the other party; whereupon the 

Earnest Money Deposit . . . shall be released to 

[Load Zone] without the requirement of further 

authorization from [Clark]. In the event of such 

cancellation, [Load Zone] agrees to accept as [its] 

exclusive remedy, the Earnest Money 

Deposit . . . as liquidated damages. [Clark] and 

[Load Zone] agree that liquidated damages would 

be difficult and impractical to calculate, and the 

Earnest Money Deposit . . . is a fair and reasonable 

estimate of *Load Zone+’s damages in the event 

[Clark] fails to obtain the Loan. 
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20130093-CA 4 2014 UT App 194

extend the settlement deadline, but Clark decided not to 

proceed. 

¶4 Rather, on October 22, Clark sent Load Zone a letter 

cancelling the REPC. He cited an unspecified unfavorable 

‚market condition‛ and requested the return of his earnest 

money, but his letter did not mention the delayed loan approval 

or the financing condition. 

¶5 Load Zone filed a breach of contract action seeking 

specific performance of the REPC. It argued that Clark breached 

the contract by failing to close the transaction and that his 

cancellation notice was ineffective because it was untimely and 

sent in bad faith. Clark stated in a deposition that he withdrew 

from the contract for two reasons—higher than anticipated 

closing costs on the loan and the fact that a neighboring property 

had sold for a little more than half the amount he had offered in 

the REPC. 

¶6 The parties filed cross-motions for summary judgment 

and Clark prevailed. The district court concluded that ‚the REPC 

clearly sets forth that if financing was not obtained by the 

financing . . . deadline, either party had the option of cancelling 

the contract by sending written notice of cancellation.‛ Because 

there was no dispute that Clark diligently sought financing 

‚until at least . . . ten days after the financing‛ deadline and that 

the parties never agreed to extend the financing deadline, the 

court determined that ‚the financing condition was not met, and 

*Clark+ was entitled to cancel the REPC.‛ The court concluded 

that Clark’s cancellation notice was effective but that Load Zone

was entitled to retain Clark’s earnest money as liquidated 

damages. Load Zone appeals.

ISSUES AND STANDARD OF REVIEW

¶7 Load Zone argues that the district court erred in granting 

summary judgment, because the REPC requires that any 
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20130093-CA 5 2014 UT App 194

cancellation be sent in good faith prior to the settlement 

deadline. We review ‚a trial court’s legal conclusions and 

ultimate grant or denial of summary judgment for correctness,‛ 

viewing ‚the facts and all reasonable inferences drawn 

therefrom in the light most favorable to the nonmoving party.‛ 

Orvis v. Johnson, 2008 UT 2, ¶ 6, 177 P.3d 600 (citations and 

internal quotation marks omitted). The interpretation of a 

contract is also a question of law that we review for correctness. 

Encon Utah, LLC v. Fluor Ames Kraemer, LLC, 2009 UT 7, ¶ 11, 210 

P.3d 263. 

ANALYSIS

¶8 We begin by examining the pertinent terms of the REPC, 

mindful that where ‚the language within the four corners of the 

contract is unambiguous, the parties’ intentions are determined 

from the plain meaning of the contractual language.‛ Café Rio, 

Inc. v. Larkin-Gifford-Overton, LLC, 2009 UT 27, ¶ 25, 207 P.3d 

1235. We also read ‚each contract provision . . . in relation to all 

of the others, with a view toward giving effect to all and 

ignoring none.‛ Glenn v. Reese, 2009 UT 80, ¶ 10, 225 P.3d 185 

(omission in original) (citations and internal quotation marks 

omitted).

¶9 Paragraph 8.3 is entitled ‚Financing Condition.‛ It

provides that Clark’s ‚obligation to purchase the 

property . . . [X] IS . . . conditioned upon *Clark+ obtaining‛ an 

$846,000 loan, and it requires him ‚to work diligently and in 

good faith‛ to do so. Paragraph 8.3(a) allows Clark the option to 

cancel the contract and recover his earnest money if he ‚is not 

satisfied with the terms and conditions of the Loan.‛ To invoke 

this option, Clark must provide ‚written notice to *Load Zone] 

no later than‛ the financing deadline of September 10, 2010. 

Once the financing deadline has passed, paragraph 8.3(b) 

permits cancellation by either party, but only if Clark ‚fails to 

obtain the Loan, meaning that the proceeds of the Loan have not 

been delivered by the Lender to [Load Zone+‛ as required by 
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20130093-CA 6 2014 UT App 194

paragraph 3.5, i.e., ‚within four calendar days after‛ the 

settlement deadline of September 20, 2010 (the closing deadline). 

While cancellation by either party under these circumstances 

results in automatic forfeiture of Clark’s earnest money deposit, 

paragraph 8.3(b) provides that ‚*i+n the event of such 

cancellation,‛ retention of the earnest money is Load Zone’s 

‚exclusive remedy.‛ 

¶10 Unlike the right to cancel under paragraph 8.3(a), which 

specifies that it must be invoked before the financing deadline, 

paragraph 8.3(b) does not restrict either party’s right to cancel to 

a specific time frame after the closing deadline passes. If Clark 

simply defaults on his obligations under the REPC, Load Zone’s 

remedy is not limited to retention of the earnest money; rather, 

paragraph 16.1 gives Load Zone three options: cancel the 

contract and keep the earnest money ‚as liquidated damages,‛ 

hold the earnest money in trust and sue Clark for specific 

performance, or return the earnest money and ‚pursue any other 

remedies available at law.‛ Finally, the REPC requires the parties 

to agree in writing if they wish to extend deadlines or alter any 

terms in the agreement. 

¶11 There is no dispute ‚that the parties entered into the 

REPC‛ and that Clark ‚diligently attempted to get a loan until at 

least September 20, 2010, . . . which was ten days after the 

financing . . . deadline.‛3 And neither party disputes that Clark 

 

3. In Load Zone’s cross-motion for summary judgment, it 

asserted that ‚at some point . . . after *Clark+ learned that he 

could purchase the nearly identical house for hundreds of 

thousands of dollars cheaper, he stopped seeking the Loan in 

good faith.‛ In its response to Clark’s statement of undisputed 

facts, Load Zone requested leave to depose ‚both the Loan 

officer at‛ Clark’s bank ‚and Clark’s real estate agent ‚to 

determine precisely when *Clark+ learned of the other property.‛ 

The district court’s ruling did not address this request, however, 

and on appeal, Load Zone has not argued that there was a 

(continued . . .)
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20130093-CA 7 2014 UT App 194

failed to obtain a loan by the financing deadline, that the parties 

did not agree to extend the settlement deadline, or that Clark 

sent Load Zone a written notice of cancellation on October 22. 

Thus, as long as Clark’s cancellation notice was timely and 

properly invoked his right to cancel, Load Zone has already 

obtained all the relief to which it is entitled under the REPC’s 

financing condition—Clark’s $3,000 earnest money deposit—and 

the broader remedies of paragraph 16.1 are not available.

¶12 Load Zone argues that Clark’s cancellation notice was 

ineffective for three reasons: (1) the REPC requires that any 

cancellation be sent prior to the settlement deadline; (2) Clark 

cancelled the contract for improper reasons; and (3) the 

substance of Clark’s cancellation notice did not specifically 

invoke his right to cancel under paragraph 8.3(b) and was 

inconsistent with the REPC’s terms. As a result, Load Zone

asserts, the REPC was never canceled and Clark is still obligated 

to purchase the property. We agree with the district court that 

Clark properly exercised his right to cancel the REPC.

I. Cancellation Deadline

¶13 We see no indication in the contract that a paragraph 

8.3(b) cancellation notice must be sent prior to the settlement 

deadline. In fact, the right to cancel is not even triggered until 

‚the proceeds of the Loan have not been delivered by the Lender to 

[Load Zone+ or to the escrow/closing office‛ ‚within four 

calendar days after Settlement.‛ (Emphasis added.) The REPC is 

also silent on how long after that trigger event either party may 

wait before sending written notice of cancellation. This contrasts 

sharply with the cancellation rights created by other clauses in 

the REPC. For example, the agreement also conditions Clark’s 

‚obligation to purchase the Property . . . upon the Property 

appraising for not less than the Purchase Price.‛ If the property 

 

factual dispute about whether Clark met his obligation under the 

REPC to diligently pursue financing. 
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20130093-CA 8 2014 UT App 194

‚has appraised for less than the Purchase Price,‛ Clark may 

cancel the agreement by sending written notice but must do so 

‚no later than‛ the financing deadline. And the appraisal 

condition is ‚deemed . . . waived‛ if Clark fails to exercise his 

right to cancel before that deadline. Similarly, the REPC’s

optional ‚Due Diligence Condition,‛ which was not selected 

here, allows the buyer to ‚cancel the REPC by providing written 

notice‛ if the buyer determines ‚that the results of the Due 

Diligence are unacceptable.‛ Like the Appraisal Condition, the 

right to cancel must be invoked before an agreed upon ‚Due 

Diligence Deadline‛ or else the ‚Buyer shall be deemed to have 

waived the Due Diligence Condition.‛ These provisions 

demonstrate that the parties were capable of drafting specific 

deadlines for contract cancellation had they intended to do so. 

Cf. Osguthorpe v. Wolf Mountain Resorts, LC, 2013 UT 12, ¶¶ 10–

16, 322 P.3d 620 (interpreting an arbitration clause to apply to a 

narrow class of legal disputes after comparing it to much

broader language that defined the scope of an attorney fee 

provision in the same agreement). Thus, the failure to include a 

cancellation deadline in the financing condition seems 

deliberate.

¶14 Because the REPC provides no deadline by which the 

parties must send a notice of cancellation under paragraph 

8.3(b), the law implies that notice must be given within a 

reasonable amount of time. See Coulter & Smith, Ltd. v. Russell, 

966 P.2d 852, 858 (Utah 1998) (‚*T+he settled rule is that if a 

contract fails to specify a time of performance the law implies 

that it shall be done within a reasonable time under the

circumstances.‛). Here, Clark sent his notice of cancellation 

about four weeks after the settlement deadline. Load Zone

argues that ‚[i]nherent‛ in paragraph 8.3(b) is an obligation to 

cancel the contract ‚before the settlement deadline, or some 

other deadline that would trigger a separate contractual 

‘default.’‛ Requiring such a deadline is reasonable, Load Zone

maintains, because ‚*r+eading this clause any other way would 

allow a party an indefinite amount of time to‛ cancel, with two 

adverse consequences—on the one hand, a defaulting buyer 
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20130093-CA 9 2014 UT App 194

could tie up the property by withholding notice of cancellation 

and, on the other, sellers could never know for certain when they 

were entitled to the full panoply of remedies for the buyer’s 

breach of his purchase obligation or merely the retention of the 

buyer’s earnest money under the financing condition.

¶15 This argument is unpersuasive. First, it ignores the fact 

that paragraph 8.3(b) provides either party a right to cancel if the 

buyer cannot secure financing, allowing a seller with a stillwilling buyer the flexibility to either wait for a loan to be 

approved after the financing deadline or to free the property for 

sale to another by giving notice of cancellation if the seller just 

does not want to wait any longer. And second, a ‚reasonable‛ 

time to cancel, while imprecise, is by no means indefinite or 

indeterminable. What constitutes a reasonable time depends on 

the circumstances. See, e.g., Richins Drilling, Inc. v. Golf Servs. 

Grp., 2008 UT App 262, ¶ 5, 189 P.3d 1280 (concluding that a 

drilling company breached its obligation to complete a well 

within a reasonable amount of time where ‚*e+xpert testimony 

established that a well of the depth contemplated by the parties 

should have been completed in less than half the time‛ the 

company took to finish it); Cooper v. Deseret Fed. Sav. & Loan 

Ass’n, 757 P.2d 483, 486 (Utah Ct. App. 1988) (holding that a 

lender failed to exercise its right to accelerate a note within a 

reasonable time when it waited four years after the borrower’s 

default to do so and the borrower made payments to bring the 

loan current in the interim). Other than its assertion that the 

contract cannot reasonably be read to allow cancellation after the 

settlement deadline, Load Zone has not pointed to any particular 

circumstances in this case that show Clark’s cancellation notice 

was unreasonably late. 

¶16 Finally, reading the REPC to allow cancellation four 

weeks after the settlement deadline does not, as Load Zone

asserts, prevent sellers from knowing ‚when non-performance 

under 8.3 end[s+ and a breach under 16.1 beg*ins+.‛ If a buyer 

fails to deliver ‚the proceeds of the Loan . . . to the 

escrow/closing office‛ by the closing deadline, he has breached 
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20130093-CA 10 2014 UT App 194

his purchase obligation, and paragraph 16.1 allows the seller to 

cancel the REPC and retain the buyer’s earnest money, maintain 

the earnest money in trust and sue for specific performance, or 

return the buyer’s earnest money and pursue any other available 

legal remedies. When the buyer cancels the REPC under 

paragraph 8.3(b), however, the contract requires the seller to 

accept as its ‚exclusive remedy‛ the buyer’s earnest money as 

‚liquidated damages.‛ A buyer unable to secure a loan therefore 

has a powerful incentive to promptly cancel the REPC to prevent 

the seller from pursuing the other remedies listed in paragraph 

16.1. And in the rare event that a buyer’s cancellation notice is 

unreasonably late, all of the seller’s remedies are available. The 

fact that the parties failed to specify a deadline for notice of 

cancellation may make the transition date from potential 

cancellation and liquidated damages to full default damages 

more difficult to ascertain. But that is what the parties agreed to, 

and ‚*w+e will not make a better contract for the parties than 

they have made for themselves.‛ See Bakowski v. Mountain States 

Steel, Inc., 2002 UT 62, ¶ 19, 52 P.3d 1179. We therefore conclude 

that the district court did not err when it determined that Clark’s 

cancellation notice sent four weeks after the settlement deadline 

(and within a day or so of Load Zone’s offer to extend the 

settlement deadline) was not unreasonably delayed.

II. Motive to Cancel

¶17 We also agree with the district court that Clark’s 

motivation for cancelling the REPC is not relevant to whether he 

properly invoked his right to do so under paragraph 8.3(b). As a 

general rule, ‚*i+f a party has a legal right to terminate *a+ 

contract . . . , its motive for exercising that right is irrelevant.‛ Tuf 

Racing Prods., Inc. v. American Suzuki Motor Corp., 223 F.3d 585, 

589 (7th Cir. 2000); see Hansen v. America Online, Inc., 2004 UT 62, 

¶ 7, 96 P.3d 950 (noting that at-will employees can be terminated 

‚for any reason (or no reason) except where prohibited by law‛); 

see also Milford–Bennington R.R. Co. v. Pan Am Rys, Inc., 695 F.3d 

175, 180–81 (1st Cir. 2012) (holding that because a party to a 

contract ‚had an unassailably valid reason‛ to exercise a 
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20130093-CA 11 2014 UT App 194

contractual right, ‚its alleged ulterior motives are irrelevant‛); 

Dayan v. McDonald’s Corp., 466 N.E.2d 958, 974 (Ill. App. Ct.

1984) (‚As a general proposition of law, it is widely held that 

where good cause exists, motive is immaterial to a determination 

of good faith performance.‛); 2 Corbin on Contracts § 6.10, at 291 

(Joseph M. Perillo & Helen H. Bender eds., 1995) (‚The option 

between terminating and not terminating is unlimited, except as 

provided in the contract or in law.‛). As we have already noted, 

there is no dispute that Clark did not obtain financing until midOctober, and the contract clearly provides either party a right to 

cancel if ‚the proceeds of the Loan have not been delivered by 

the Lender to [Load Zone+‛ by the closing deadline. Clark 

therefore had a legal right to terminate the REPC, and we agree 

with the district court that his motives for doing so are not 

material.

III. Substance of the Notice

¶18 Finally, the substance of Clark’s cancellation notice was 

adequate to invoke his right to cancel. ‚It is generally accepted 

that a notice of termination or cancellation of a contract must be 

clear and unequivocal.‛ Glenn v. Reese, 2009 UT 80, ¶ 19, 225 P.3d 

185. ‚The focus of any inquiry into the adequacy of cancellation 

is on whether the notice is sufficiently clear to apprise the other 

party of the action being taken.‛ Id. (citation and internal 

quotation marks omitted). And so long as the notice reasonably 

expresses the intention to cancel, the fact that its stated 

justification does not expressly invoke the pertinent contract 

terms does not, by itself, render the notice ineffective. See

ProMark Grp. v. Harris Corp., 860 P.2d 964, 967 (Utah Ct. App. 

1993). For example, in ProMark, a manufacturer sent a written 

notice in August 1989 that purported to terminate its 

relationship with a sales representative ‚completely and 

irrevocably as of March 21, 1989.‛ Id. The contract, however, 

prohibited the parties from retroactively terminating their 

relationship and required at least ninety days written notice 

before termination. Id. This court held that ‚*e+ven though the 

letter attempts to make the termination retroactive, in violation 
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20130093-CA 12 2014 UT App 194

of the terms of the . . . Agreement, this attempt does not 

invalidate the termination itself.‛ Id. Rather, because ‚the letter 

explicitly state*d+‛ the manufacturer’s intent to exercise its right 

to terminate the contract, the inconsistencies affected only ‚the 

timing of the effective date of the actual termination,‛ not the 

validity of the termination itself. Id. 

¶19 Here, Clark’s cancellation notice stated, ‚I C. Dennis 

Clark wish to cancel the Real Estate Purchase Contract for the 

property located at 740 Spruce Drive Garden City, Utah 84028 

due to the market condition. I would like to have my earnest 

money of $3,000.00 . . . returned.‛ Load Zone argues this notice 

was ineffective because Clark ‚expressly sought to have his 

earnest money returned‛ and did not cite paragraph 8.3(b) of the 

REPC or identify the financing condition as a basis for his 

cancellation. While it is true that Clark was not entitled to have 

his earnest money returned under 8.3(b), his intent ‚to cancel the 

[REPC] for the property located at 740 Spruce Drive Garden 

City, Utah 84028‛ was clear and unequivocal. Consequently, as 

in ProMark, Clark’s request for his earnest money in the 

cancellation notice may have conflicted with the terms of the 

agreement, but it ‚does not invalidate the termination itself.‛ See

id. And even though the notice did not expressly cite or 

implicate the contract provision that authorized the cancellation, 

the REPC requires only ‚written notice‛ without mandating that 

the parties invoke specific contractual provisions or use specific 

language. We also note that Load Zone’s letter in late October 

proposing to extend the settlement deadline demonstrates it was 

well aware that both the financing and settlement deadlines had 

passed without Clark’s loan having been approved. In light of 

these circumstances, we conclude that the notice was 

‚sufficiently clear to apprise‛ Load Zone ‚of the action being 

taken,‛ Glenn, 2009 UT 80, ¶ 19, and Clark’s termination notice 

was therefore effective.
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20130093-CA 13 2014 UT App 194

CONCLUSION

¶20 We affirm the district court’s decision that Clark 

effectively terminated the REPC under paragraph 8.3(b) and did 

not breach any obligation to purchase the property. Load Zone is 

therefore not entitled to specific performance of the REPC and 

has already received all the relief to which it is entitled under the 

contract, Clark’s earnest money. 

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