A Company formed to acquire undeveloped real property executed a purchase agreement and paid earnest money based on a number of representations and agreements made by a third party that never materialized. The Company had plans to develop and construct a franchise hotel if it could finalize all terms, covenants and conditions of the purchase agreement.
The Company engaged in efforts to close the transaction, but the third party refused to comply with the terms of the purchase agreement. As a result, the Company terminated the purchase agreement and requested a return of its earnest money. However, the third party refused claiming a breach of contract and millions of dollars in damages.
In order for damages to be claimed, losses have to be foreseeable at the time of the agreement, losses have to have been incurred, and the injured party has a duty to mitigate its losses. The third party in this case did not have lost profits and never committed to anything regarding development of the hotel project.
Work included an analysis of opposing expert’s alleged damages including lost revenues, lost profits, and equity monetization, and the determination that the calculations were unsupported, erroneous, highly speculative, and not reasonably certain. Additional work included identifying the myriad of improper assumptions, speculations, uncertainties, and unresolved issues relied upon or ignored.
Accumyn issued an expert rebuttal report which assisted the trier of fact in granting the Company’s motion for summary judgment.