Opinion ID: 1680654
Heading Depth: 1
Heading Rank: 6

Heading: Time of the Essence Provisions

Text: ¶ 24. Unless a contract expressly states so, or unless there is otherwise shown to be a clear indication of intent, time is not ordinarily considered to be of the essence in the performance of a contract. Gault v. Branton, 222 Miss. 111, 75 So.2d 439, 445 (1954); Lee v. Schneider, 822 So.2d 311, 314 (Miss.Ct.App.2002). We note that in order for equity to regard contracts as of the essence, one of two conditions must be satisfied. In the absence of either condition, time will not ordinarily be considered of the essence in contract performance. ¶ 25. First, the contract must expressly state that time is of the essence. We acknowledge that the contract here on its face does not declare time to be of the essence as far as the scheduled closing date. To this end, we are called upon to consider the second condition. The second way for equity to regard timely contract performance as of the essence is there must be a clear indication of intent by the parties to the same. In his findings of fact, the chancellor stated that there is no doubt it was clear to everyone involved that time was of the essence of the Sellers. However, the record reveals that during cross-examination of the Sellers' realtor, the specific question was asked, [Do] you understand that you can put time is of the essence on the contract? The Sellers' realtor responded affirmatively. The realtor was asked, Now, in this contract, you did not request the terms that time is of the essence? The realtor responded negatively. The Court engaged in its own questioning of the Sellers and determined that the only individual aware of their desire to have a quick sale was Curtis Harrison, their real estate agent. ¶ 26. In Lee v. Schneider , the Court of Appeals dealt with a factually similar case. In Lee, a real estate contract set the closing to occur on or before June 30, 1994. Id. at 313. The sellers considered the contract to be voided or to be terminated for failure to perform within the time prescribed. Id. The purchaser instituted an action for specific performance in the Chancery Court of Pearl River County. Id. The trial court determined that the contract on its face did not provide time to be of the essence as far as the scheduled closing date was concerned. Id. Having so determined, the trial court ruled that the purchaser was entitled to specific performance if the defects could be worked out within a reasonable time and so ordered. Id. at 313-14. The seller appealed the ruling, and the Court of Appeals followed the reasoning of this Court in Gault and stated, Unless the contract expressly so states, or unless there is otherwise shown to be a clear indication of intent, time is ordinarily not considered to be of the essence in the performance of a contract. Id. ¶ 27. Here, there is no clear indication (regarding time of performance) between the parties supported by the record. Indeed, the Sellers' realtor, Curtis Harrison, was the sole source of communication with Ferrara's realtor that he (Curtis Harrison) did not know why the closing date was set when it was and he was not advised of any exigency in the sale which was out of the ordinary. During trial, Curtis Harrison testified that while he did not remember exactly why the Sellers wanted to close the property within 45 days, he did know that they insisted that he negotiate downward Ferrara's initial request for 60 days in which to close. Obviously, if the Sellers did not tell their realtor why time was of the essence, he could not have imparted any such information to Ferrara. It is undisputed that at no time was the point made to Ferrara or his agent that time was of the essence under this contract. A complete review of the record reveals that there was no clear indication as to the parties' intent to make time of the essence. To this end, we hold that the trial court was manifestly wrong to conclude otherwise. ¶ 28. We hold that in order for the trial court to determine the existence of a clear indication of the parties' intent with regard to time being of the essence, the trial court must consider all relevant circumstances surrounding the transaction. Because the contract in the instant action (i) did not contain a provision expressly stating that time to be of the essence, nor (ii) can a clear indication of the parties' intent be ascertained from the relevant circumstances, we hold that time was not of the essence.