Opinion ID: 2090001
Heading Depth: 2
Heading Rank: 1

Heading: Proposed Assignment to Jung Soon Chung

Text: On February 2, 1993, Jung Soon Chung signed a contract to purchase ESS at the price of $450,000 with the seller's guarantee of business in the amount of $22,000 in a two-week period and settlement to occur within thirty days. A letter from Mrs. Chung's counsel, Dimitri Mallios, dated February 4, 1993, requested assignment of the lease and an extension of the lease term to a full ten years. Included with the letter was an unaudited financial report and personal financial statement for Mrs. Chung. As a condition of acceptance, the landlord insisted on cancellation of the addendum to the lease which had reduced the rent payable by ESS during the remaining course of the lease term. On February 16, Mr. Mallios wrote to inform William Joseph H. Smith, attorney for ESS, that the request for assignment of the lease to Mrs. Chung had been denied. Thereupon, Mr. Smith, in a February 18 letter, acting on behalf of ESS, made an unequivocal demand for completion of the assignment at the rent set in the rentreduction addendum and expressed the view that withholding consent based on that condition constituted an unreasonable withholding of consent under the terms of the lease. On March 2, 1993, appellee Asadoorian, the retail lease agent for the landlord, met with ESS. This meeting resulted in Asadoorian's March 3 memorandum to appellee Goodwin in which he acknowledged that the landlord's position that the addendum should be nullified was untenable under the lease, and added: Our basis for non-approval should be on the merits of the assignee and their experience in running the type of operation that [ESS] is. In a March 4 letter to Mr. Mallios, Asadoorian requested that Mrs. Chung submit supplemental financial information. On March 16, Mrs. Chung's counsel wrote to counsel for ESS to withdraw Mrs. Chung's offer and in a March 23 letter to Asadoorian expressed his impression that the transaction was dead, but nevertheless enclosed the financial information requested by Asadoorian in his March 4 letter. On March 31, appellee Goodwin wrote to Mr. Smith expressing concerns about the financial materials furnished by the Chungs. [4] Goodwin identified a discrepancy between the small amount of interest income reported on their 1992 federal tax return and the $324,255 in potentially interest yielding assets demonstrated on the financial statement provided, and expressed concern that [t]hings don't seem to add up. [5] On April 7, 1993, ESS authorized the broker to return the $20,000 deposit to Mrs. Chung.