Kuhn v. Spatial Design, Inc.
Supreme Court of New Jersey, Appellate Division
585 A.2d 967 (1991)
John and Marlene Kuhn (plaintiffs) agreed to buy a New Jersey home from Spatial Design, Inc. (defendant) for $515,000, paying a $50,000 deposit, but after failing to secure a mortgage, sought to cancel the contract. Spatial refused to return the deposit and eventually resold the house to other buyers for $434,000. The Kuhns sued for return of their deposit based on the contract's mortgage contingency clause; Spatial counterclaimed, arguing the Kuhns had falsified their mortgage application and were in breach. The trial court sided with Spatial, ordering the Kuhns to pay nearly $100,000 in damages, less their retained deposit, and the Kuhns appealed.
Whether a real estate seller is entitled to damages from a defaulting purchaser based on the difference between the contract and resale prices.