Opinion ID: 721571
Heading Depth: 3
Heading Rank: 1

Heading: Prudential Development Action

Text: 3 According to the fourth amended complaint in Prudential Development Co. v. Stanford Ranch, Inc., Placer County Superior Court No. 83239, in April of 1988, Prudential entered into an agreement for the purchase and sale of real property in the Stanford Ranch Development, identified as Parcel 17, Phase II (purchase property). The agreement requires Stanford to use its best efforts to secure governmental approvals of (a) a lawful land-division which would create a legal parcel for recordation and transfer of legal title to PRUDENTIAL, and (b) a permit from the Army Corps of Engineers authorizing the filling of wetlands on the development property pursuant to Section 404 of the Clean Water Act (33 USC 1344). If Stanford's best efforts did not result in the necessary approvals by July 15, 1988, the closing date of escrow would be extended. 4 The complaint alleges that both before and after the agreement was entered into, Stanford represented to Prudential that it would be able to obtain the necessary governmental approvals by the July 15 deadline. 5 On May 13, 1988, Prudential and Stanford entered into an amendment to the purchase agreement which requires Stanford to deliver a preliminary title report regarding the purchase property within five days of recordation of the final parcel map. Prudential alleges that escrow is not to close until this title report is delivered. 6 Prudential's complaint also alleges a series of misrepresentations and concealments with respect to the original agreement relating to the wetlands permits. Prudential claims that Stanford filled in a portion of wetlands on the Stanford Ranch Development in violation of Section 404 of the Clean Water Act before the agreement was entered into; 2 that Stanford misrepresented the amount of wetlands subject to application for a Section 404 permit; and that Stanford knew or should have known that it could not obtain a permit from the United States Army Corps of Engineers (Corps) by the July 15 closing date due to its unauthorized and undisclosed filling of the wetlands. 7 Stanford advised Prudential for the first time, in a letter dated June 3, 1988, that it might not be able to obtain the needed governmental approvals by July 15, 1988, and that it was unable to close escrow because of 'unanticipated' demands caused by the City of Rocklin. 8 Prudential claims that on June 30, 1988, Stanford advised Prudential that the Section 404 permit had been issued and would be received 'momentarily.'  However, Prudential alleges that on July 5, 1988, Stanford informed Prudential that, in fact, no Section 404 permit had issued. STANFORD then assured PRUDENTIAL that everything would still work out and that PRUDENTIAL should not worry because STANFORD would still honor the Agreement. 9 Prior to the July 15 closing date, Stanford proposed an extension of closing to August 15, which the parties ultimately extended to November 15, 1988. When the parties attempted to put the extension in writing, Prudential alleges that STANFORD insisted that PRUDENTIAL agree to a number of material modifications, including elimination of any duty on STANFORD's part to obtain the governmental approvals, and elimination of the Amendment extending the close of escrow for STANFORD's delivery of the preliminary title report to PRUDENTIAL. Prudential refused to modify the agreement as requested. 10 On September 30, 1988, Stanford sent a letter to Prudential stating that Stanford was terminating the agreement. Prudential alleges that Stanford's motive for repudiating the agreement was to force Prudential to re-negotiate the purchase and sale of the Purchase Property at a price more favorable to STANFORD, or to put the property back on the market at a higher price. 11 Based on the foregoing, Prudential asserts claims for specific performance; declaratory relief regarding Stanford's continuing obligation to perform under the contract; breach of contract; breach of the covenant of good faith and fair dealing; intentional misrepresentation; negligent misrepresentation; and nondisclosure.