Opinion ID: 2095087
Heading Depth: 2
Heading Rank: 2

Heading: Breach Regarding the Purchase of the RDC Shares

Text: [¶ 17] Jeffrey and Diane claim that their late purchase of the RDC shares was justified by John and Craig's breach of the agreement. The court concluded that Jeffrey and Diane were not justified in delaying the purchase. The court interpreted the agreement's time requirements for the purchase of RDC shares as independent of John and Craig's obligation to turn over the RDC corporate records. We review the court's construction of the unambiguous contract de novo. See Willis Realty Assocs. v. Cimino Constr. Co., 623 A.2d 1287, 1288 (Me.1993). [¶ 18] Jeffrey and Diane contend that John and Craig's failure to turn over the RDC corporate records by February 16 caused them to withhold payment. According to Jeffrey and Diane, the records delivered on February 16 were not complete. As a result, they were not able to determine if John and Craig had satisfied their representation that they had managed RDC in the ordinary course of business with proper corporate governance since May, 1999. Jeffrey and Diane argue that the settlement agreement made the RDC payment contingent on the fulfillment of John and Craig's obligations. The agreement states: In the event that Jeffrey and Diane are unable to close the entire transaction on or before March 23, 2001, they shall pay $727,500.00 to Craig and John to redeem their [SCC] stock and also pay $27,500.00 to Craig to buy out his partnership interest in 4-S. Thereafter, Diane and Jeffrey shall have an additional 45 days from [March 23] in which to close the purchase and/or redemption of the [RDC] stock for $1,400,000.00. We agree with John and Craig's assertion that the phrase unable to close means that only Jeffrey and Diane's inability to close by March 23 allows a later purchase of the RDC shares. [¶ 19] The representation by John and Craig that RDC had been run in the ordinary course of business was independent of the provisions regarding the closing date and the consequences of Jeffrey and Diane's inability to close. Because Jeffrey and Diane did not present any evidence to the trial court on their inability to close by the closing date, the court did not err in determining that they breached the settlement agreement with regard to the RDC payment and in finding that John and Craig were entitled to interest for that late payment.