Court Opinion

ID: 4776013
Source: CourtListenerOpinion
Date Created: 2021-08-18 15:03:41.76132+00
Date Added: 2024-06-11T08:09:31.609841
License: Public Domain

Case: 20-1687    Document: 33     Page: 1   Filed: 08/18/2021

        NOTE: This disposition is nonprecedential.

   United States Court of Appeals
       for the Federal Circuit
                  ______________________

       COASTAL PARK LLC, MEYER LANDAU,
               Plaintiffs-Appellants

                             v.

                    UNITED STATES,
                    Defendant-Appellee
                  ______________________

                        2020-1687
                  ______________________

     Appeal from the United States Court of Federal Claims
 in No. 1:17-cv-00422-DAT, Judge David A. Tapp.
                  ______________________

                 Decided: August 18, 2021
                  ______________________

    G. ALEXANDER NOVAK, Novak, Juhase & Stern, LLP,
 Cedarhurst, NY, for plaintiffs-appellants.

     STEPHEN CARL TOSINI, Commercial Litigation Branch,
 Civil Division, United States Department of Justice, Wash-
 ington, DC, for defendant-appellee. Also represented by
 DEBORAH ANN BYNUM, JENNIFER B. DICKEY, ROBERT
 EDWARD KIRSCHMAN, JR.
                   ______________________
Case: 20-1687     Document: 33      Page: 2    Filed: 08/18/2021

 2                                      COASTAL PARK LLC   v. US

     Before PROST *, BRYSON, and REYNA, Circuit Judges.
 PROST, Circuit Judge.
      Appellants Coastal Park LLC and Meyer Landau (col-
 lectively, “Coastal Park”) filed this suit in the Court of Fed-
 eral Claims seeking return of a $310,000 deposit paid
 under Coastal Park’s agreement to purchase a former U.S.
 Coast Guard housing complex in Elizabeth City, North
 Carolina. The complex included various housing units as
 well as “several basketball goals, a tennis court, a chil-
 dren’s playground, [and] a large gazebo.” J.A. 30. The gov-
 ernment kept Coastal Park’s deposit upon concluding that
 Coastal Park had defaulted on the transaction. The Court
 of Federal Claims ruled that Coastal Park was not entitled
 to return of the deposit. Coastal Park LLC v. United States,
 147 Fed. Cl. 179, 185 (2020). We affirm.
                         BACKGROUND
     The U.S. General Services Administration (“GSA”) ac-
 cepted Mr. Landau’s $3.1 million bid in an auction of the
 subject property on September 8, 2016. J.A. 58. The re-
 sulting contract 1 required Coastal Park to deposit $100,000
 with its opening bid, as well as a further deposit that would
 bring the deposited funds to 10% of the purchase price.
 J.A. 41, 45. Coastal Park made both deposits, together
 $310,000. The remaining balance would come due on the

     *   Circuit Judge Sharon Prost vacated the position of
 Chief Judge on May 21, 2021.
      1  The invitation for bids (“IFB”) to which Coastal
 Park responded provides that “[t]he IFB and the bid, when
 accepted by the Government shall constitute an agreement
 for sale . . . between the high bidder . . . and the Govern-
 ment.” J.A. 36. This agreement “shall constitute the whole
 contract to be succeeded only by the formal instrument(s)
 of transfer, unless modified in writing and signed by both
 parties.” J.A. 36.
Case: 20-1687     Document: 33      Page: 3    Filed: 08/18/2021

 COASTAL PARK LLC   v. US                                     3

 “closing date,” October 23, 2016. J.A. 39. The contract
 specified an “[a]ll cash, as is” transaction. J.A. 28. It also
 stated that “[t]he failure of any bidder to inspect, or to be
 fully informed as to the condition of all or any portion of the
 Property, will not constitute grounds for any claim or de-
 mand for adjustment or withdrawal of a bid after the auc-
 tion.” J.A. 36.
     On October 8, 2016, Hurricane Matthew made landfall
 in South Carolina and then traveled north along the coast.
 Coastal Park, 147 Fed. Cl. at 182; JA 696–97, 703. On Oc-
 tober 14, Coastal Park sought an extension of the closing
 date, citing hurricane-related delays in surveying, ap-
 praisal, and inspection work. J.A. 674. And on October 21,
 GSA granted an extension to October 30 based on Coastal
 Park’s extension request regarding “the delays of business
 activities in the eastern North Carolina area caused by
 Hurricane Matthew,” and also offered a further extension
 to November 14 that was conditioned on an additional 10%
 deposit. J.A. 69; see Coastal Park, 147 Fed. Cl. at 182. Alt-
 hough Coastal Park didn’t make the extra deposit, GSA
 nonetheless on October 28 granted an additional extension
 to October 31 at Coastal Park’s request. Coastal Park,
 147 Fed. Cl. at 182. And on October 31, GSA granted a
 further extension to November 7, again due to “delay of
 business activities caused by Hurricane Matthew” and
 without requiring a further deposit. J.A. 71; see Coastal
 Park, 147 Fed. Cl. at 182.
     Additionally, GSA noted that this extension would
 “also afford [Coastal Park] the opportunity to view and in-
 spect the property.” J.A. 71. Coastal Park subsequently
 hired two inspections firms to assess any damage caused
 by the hurricane and forwarded the resulting reports to
 GSA on November 6. Coastal Park, 147 Fed. Cl. at 182.
 The reports declined to attribute any damage to the hurri-
 cane or quantify any damage occurring after the ac-
 ceptance of the bid. Id.; see J.A. 88 (“Condition prior to this
 date is unknown.”); J.A. 91 (“[D]etermining when the
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 4                                     COASTAL PARK LLC   v. US

 damage occurred or the extent of damage is beyond the
 scope of the inspection.”).
     On November 7, GSA contacted Coastal Park, noting
 that GSA had received neither the final balance nor the
 10% deposit required for the previously discussed exten-
 sion to November 14. J.A. 111–12; Coastal Park, 147 Fed.
 Cl. at 182. GSA noted further that, although it had re-
 ceived the two inspection reports, neither one included a
 “monetary assessment” of the damage as requested.
 J.A. 111. GSA therefore explained that, because it “ha[d]
 not yet received the requested information and balance
 due,” it was putting Coastal Park “on notice to cure” and
 that “otherwise a finding of default of the contract will be
 determined.” J.A. 111; see Coastal Park, 147 Fed. Cl.
 at 182. GSA gave Coastal Park until 11:00 a.m. on Novem-
 ber 9 to forward the outstanding balance and indicated
 that failure to do so would “result in the forfeiture of the
 $310,000.00 bid deposit per the [contract].” J.A. 111; see
 Coastal Park, 147 Fed. Cl. at 182.
     Coastal Park responded through counsel on Novem-
 ber 8 that it “rejected” the notice to cure and demanded
 that GSA “tell[] us what it wants ‘monetized.’” J.A. 129; see
 Coastal Park, 147 Fed. Cl. at 182. When Coastal Park did
 not forward the funds due on November 9, GSA declared
 Coastal Park in default the next day. J.A. 109–10. GSA
 sold the property to another bidder on December 15.
 Coastal Park, 147 Fed. Cl. at 182.
     Coastal Park sued in the Court of Federal Claims. The
 court dismissed some of Coastal Park’s claims—none of
 which are raised on appeal—leaving only Coastal Park’s
 claim for the deposited $310,000. The parties cross-moved
 for summary judgment. The court denied Coastal Park’s
 motion and granted the government’s. Id. at 185. This ap-
 peal followed. We have jurisdiction under 28 U.S.C.
 § 1295(a)(3).
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 COASTAL PARK LLC   v. US                                        5

                            DISCUSSION
                                I
      We review the Court of Federal Claims’ grant of sum-
 mary judgment and its contract interpretation de novo.
 Shaw v. United States, 900 F.3d 1379, 1381 (Fed. Cir.
 2018). “Summary judgment is appropriate when there is
 no genuine issue of material fact and the moving party is
 entitled to judgment as a matter of law.” Id. at 1382 (quot-
 ing Nw. Title Agency v. United States, 855 F.3d 1344, 1347
 (Fed. Cir. 2017)). “Contract interpretation begins with the
 language of the written agreement.” Coast Fed. Bank, FSB
 v. United States, 323 F.3d 1035, 1038 (Fed. Cir. 2003) (en
 banc). “When the contractual language is unambiguous on
 its face, our inquiry ends and the plain language of the
 [a]greement controls.” Id. at 1040–41. That is precisely
 the situation here.
     First, the balance was due on the “closing date,” as
 noted above. J.A. 39; see Coastal Park, 147 Fed. Cl.
 at 181, 184. Second, the government was entitled to retain
 the deposit as a remedy for default:
     In the event of . . . any default by the Purchaser in
     the performance of the contract . . . or . . . failure by
     the Purchaser to consummate the transaction, the
     Purchaser agrees that any Earnest Money and all
     deposits paid to the Government in any acceptable
     form . . . are subject to forfeit by the Purchaser to
     the Government at the option of the Government
     as damages for breach of contract.
 J.A. 37–38. 2

     2    “Earnest Money” was defined as “the Bidder’s de-
 posit of money demonstrating the Purchaser’s good faith
 offer to the Government to fully execute and comply with
 all terms, conditions, covenants and agreements contained
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 6                                     COASTAL PARK LLC   v. US

     Third, the contract states that “[t]he Government re-
 serves the right to extend the closing date for a reasonable
 amount of time.” J.A. 39. And, in a section titled “Delayed
 Closing,” the contract provides:
     Except for delayed closing caused solely by the Gov-
     ernment or force[] majeure events, any change to
     the closing date established in Section 15 [i.e., Oc-
     tober 23, 2016] is subject to written approval by the
     Government. The Government reserves the right
     to refuse a Purchaser’s request for extension of
     closing. . . . The Government may impose addi-
     tional terms and conditions to grant an extension.
 J.A. 39–40.
     Coastal Park did not “consummate the transaction,”
 J.A. 37, by the October 23 closing date. Nor did it do so by
 November 7, the last extension granted by GSA. Accord-
 ingly, GSA declared Coastal Park in default and Coastal
 Park “forfeit[ed]” its earnest-money deposits, J.A. 37. As
 the Court of Federal Claims explained, “[p]ayment was due
 on the Closing Date, and although this date was modified
 several times, failure to tender payment in full amounted
 to a default.” Coastal Park, 147 Fed. Cl. at 184 (internal
 quotation marks omitted).
                              II
    Coastal Park’s arguments to the contrary are unper-
 suasive.  First, Coastal Park takes issue with the

 in any contract resulting from the Government’s ac-
 ceptance of the Bidder’s offered bid price.” J.A. 35. “Once
 a bid is accepted by the Government for contract,” the def-
 inition continues, “all prior deposits made by the Purchaser
 to register for the sale . . . become Earnest Money to the
 benefit, custody, accountability and control of the Govern-
 ment.” J.A. 35.
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 COASTAL PARK LLC   v. US                                    7

 conclusion that time was of the essence. Appellant’s Br.
 10–16. “When a contract contains fixed dates for perfor-
 mance,” the Court of Federal Claims explained, “failure to
 perform within those deadlines is a condition of default.”
 Coastal Park, 147 Fed. Cl. at 183 (citing DeVito v. United
 States, 413 F.2d 1147, 1154 (Ct. Cl. 1969); Pinewood Realty
 Ltd. P’ship v. United States, 617 F.2d 211 (Ct. Cl. 1980)).
 As Coastal Park admits, this proposition is grounded in the
 holding of DeVito that “[t]ime is of the essence in any con-
 tract containing fixed dates for performance,” 413 F.2d
 1147; see also Pinewood, 617 F.2d at 103 (reiterating same
 in real-estate context), and this case is binding precedent.
 Appellant’s Br. 10–11 n.3 (citing S. Corp. v. United States,
 690 F.2d 1368, 1369 (Fed. Cir. 1982) (en banc). Nonethe-
 less, Coastal Park suggests that general principles of real-
 estate contract law, and especially those of North Carolina,
 suggest revisiting this federal rule. Appellant’s Br. 10–16.
 But in our view, DeVito and Pinewood control in the context
 of this case, and as a panel we are not at liberty to overturn
 or ignore them.
       Coastal Park also argues that, rather than declaring it
 in default, GSA should have instead assessed $1,000 per
 day in liquidated damages. Those liquidated damages,
 however, are only contemplated if the government grants
 an extension. J.A. 39. And the contract leaves the grant-
 ing of any extension, as well as whether to pursue that rem-
 edy if so, to the government’s discretion. J.A. 39 (“The
 Government reserves the right to refuse a Purchaser’s re-
 quest for extension of closing. However, if the Government
 grants an extension, the Purchaser may be required to pay
 . . . a liquidated damages assessment of $1,000.00 per day
 . . . .”). Moreover, as already noted, the contract provides
 also that “any Earnest Money and all deposits . . . are sub-
 ject to forfeit . . . at the option of the Government as dam-
 ages for breach of contract.” J.A. 37–38. Here, the Court
 of Federal Claims found that “GSA had no confidence in
 Coastal’s ability to consummate the transaction should
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 8                                      COASTAL PARK LLC   v. US

 another extension be granted,” and that “the permissive
 language in [the contract] provisions provides . . . GSA with
 a choice of remedies if Coastal failed to consummate the
 sale by November 9, 2016, the final closing date.” Coastal
 Park, 147 Fed. Cl. at 185.
     Last, Coastal Park makes several arguments premised
 on an alleged oral agreement to a 90-day extension, pur-
 portedly entered on September 23, 2016. E.g., Appellant’s
 Br. 8. First, the government notes that this allegation was
 raised for the first time on appeal, Appellee’s Br. 18–21,
 and Coastal Park has not disputed that. Coastal Park’s
 arguments based on this purported oral agreement are
 therefore forfeited. Coastal Park ought to have raised this
 allegation below; it is not for us to evaluate in the first in-
 stance. At any rate, the contract expressly states that “any
 change to the closing date . . . is subject to written approval
 by the Government,” J.A. 39 (emphasis added), and it ex-
 pressly disclaims oral representations being part of the
 contract, J.A. 36, so a merely oral agreement could not
 have sufficed.
                         CONCLUSION
     We have considered Coastal Park’s remaining argu-
 ments but find them unpersuasive. We therefore affirm
 the judgment in the government’s favor.
                         AFFIRMED