       Third District Court of Appeal
                                 State of Florida

                         Opinion filed September 20, 2017.
          Not final until disposition of timely filed motion for rehearing.
                                ________________

                                 No. 3D15-1136
                           Lower Tribunal No. 11-39836
                               ________________


                         Penny’s Investment Corp.,
                                     Appellant,

                                         vs.

        Alexander Gasamanes and Yeremy Hernandez Prieto,
                                     Appellees.


      An appeal from the Circuit Court for Miami-Dade County, Antonio Marin,
Judge.

      Benitez & Associates and Leo Benitez and Lizette Benitez, for appellant.

      Silver & Silver and Ira S. Silver, for appellees.


Before ROTHENBERG, C.J., and SUAREZ and FERNANDEZ, JJ.

      SUAREZ, J.

      Penny’s Investment Corp. (Penny’s) appeals a final judgment granting

Appellees Alexander Gasamanes (“Gasamanes”) and Yeremy Hernandez Prieto

(“Prieto”) a refund of their home construction deposits. We affirm.
      On March 20, 2011, Appellees executed a Sales Agreement (“Agreement”)

to purchase a home which was to be constructed by Penny’s. Penny’s actually

executed the Agreement on March 23, 2011 because the person with whom

Appellees interacted on March 20th was merely a sales agent for a different entity

and was not authorized to execute the Agreement on Penny’s behalf. The Purchase

price of the home was $239,900.00, and nothing in the Agreement indicated that

the price of the home included any additional cost resulting from the location of

the lot on which the home was to be built.1

      It is undisputed that on March 20, 2011 Appellees provided the sales agent

with a check in the amount of $5,000.00. It is also undisputed that on March 23,


1 In their Answer Brief Appellees argued that they were not provided a full copy of
the Agreement at the time of execution. Appellees’ trial testimony on this issue is
unclear but can be read as admitting that, in fact, they did have a complete copy of
the Agreement. However, that reading of the testimony is undermined by the fact
that Appellees’ counsel made repeated requests for a complete copy of the
Agreement in September and November 2011 and neither Penny’s nor its counsel
responded to those requests. The question of whether Appellees had a full copy of
the Agreement appears to be an issue of fact which the trial court implicitly
resolved in favor of Appellees in the Final Judgment. It is not the function of this
Court to make its own factual findings and we therefore review this appeal
presuming that Appellees did not have a full copy of the Agreement prior to its
production by Penny’s in this litigation. Underwater Eng'g Servs., Inc. v. Util. Bd.
of City of Key W., 194 So. 3d 437, 444 (Fla. 3d DCA 2016), reh'g denied (July 6,
2016) (“In reviewing a judgment rendered after a bench trial, ‘the trial court's
findings of fact come to the appellate court with a presumption of correctness and
will not be disturbed unless they are clearly erroneous.’” (quoting Emaminejad v.
Ocwen Loan Servicing, LLC, 156 So. 3d 534, 535 (Fla. 3d DCA 2015))); Farneth
v. State, 945 So. 2d 614, 617 (Fla. 2d DCA 2006) (“A fundamental principle of
appellate procedure is that an appellate court is not empowered to make findings of
fact.”).

                                         2
2011 Appellee Gasamanes went to the offices of the sales agent and delivered two

additional checks, one in the amount of $18,990.00 and another for $15,000.00.

The Agreement acknowledges receipt of the original $5,000.00 and sets forth a

requirement that an “Additional 5% deposit” in the amount of $18,990.00 is due

within 30 days after acceptance of the contract by seller. However, the Agreement

makes no provision for the $15,000.00 payment.          The initial check and the

$18,990.00 check total $23,990.00, exactly 10% of the purchase price of the home,

and the Agreement indicates that the balance due for the home after the deposits is

$215,910.00.

      The parties disagree about the purpose of the additional check. Penny’s

claims it is an additional deposit required for a premium lot and a notation to that

effect is written on the memo portion of the check. Appellees testified that they

were never advised of any premium price for the location of the home they

selected and deny any knowledge of any such additional deposit requirement. It is

undisputed that the notation on the check was written in by the sales agent who

received the check and not by either Appellee. It is also undisputed that the

Agreement does not contain any provision or additional language indicating that

the lot selected by Appellees was a “premium lot” or that there was any additional

cost associated with the lot.2

2 At some points Penny’s has also argued that the $15,000.00 was simply an
additional deposit amount. That argument is inconsistent with the Agreement’s
requirement that Appellees pay 20% of the purchase price and obtain financing for

                                         3
     The Agreement contains a Mortgage Rider which states, in pertinent part:

           THE PURCHASER’S obligation to close the above
           referenced Contract is subject to the PURCHASER
           obtaining a Mortgage Commitment in the amount of
           $191,920.

           (A) The PURCHASER agrees to make application with
           FLORIDA MORTGAGE UNDERWRITERS, INC. the
           Lender selected by the SELLER and to execute all
           necessary papers for a Conventional Mortgage Loan
           (prevailing rates and terms) in the amount set forth above
           within five (5) working days of date.

           ....

           (C) PURCHASER shall notify SELLER in writing
           within forty-five (45) days of date hereof if he has or has
           not qualified for said financing.           In the event
           PURCHASER fails to notify the SELLER in writing
           within said 45 days period, it shall be conclusively
           presumed that PURCHASER has obtained a Mortgage
           Commitment in accordance with the terms of this Rider
           and this sale will proceed as an all cash transaction.
           (e.s.)

           (D) If the PURCHASER fails to obtain said Mortgage
           Commitment and has notified SELLER in writing within
           the time specified in Paragraph C of this Mortgage Rider,
           then all deposits made hereunder, will be returned to
           PURCHASER and this Contract will be null and void
           and all parties will be relieved of all liability hereunder.

           ....

           (F) IN THE EVENT PURCHASER APPLIES WITH A
           LENDER OTHER THAN THE ONE SELECTED BY
           SELLER,    THIS   CONTRACT    SHALL    BE

the remaining 80% and is also inconsistent with the merger clause in the
Agreement. We therefore reject that claim.

                                        4
              CONSIDERED AN “ALL CASH SALE” (e.s.)
              PURCHASER SHALL IMMEDIATELY MAKE AN
              ADDITIONAL NON-REFUNDABLE DEPOSIT OF
              10% OF THE PURCHASE PRICE. THIS MORTGAGE
              RIDER AND THE FINANCING CONTINGENCY
              SHALL NOT APPLY. FAILURE TO MAKE THE
              ADDITIONAL DEPOSIT ON TIME SHALL
              CONSTITUTE     A  DEFAULT    UNDER   THE
              CONTRACT, RECEIPT BY SELLER OF A
              QUALIFICATION     OR    PREQUALIFICATION
              LETTER FROM ANOTHER LENDER SHALL NOT
              REPRESENT A WAIVER OF THE CONDITIONS SET
              FORTH IN THIS PARAGRAPH.

In other words, the Mortgage Rider indicates that the sale will be “all cash” under

two circumstances: (i) under the “conclusive presumption” which arises if the

purchaser fails to notify the seller of a Mortgage Commitment from the seller’s

chosen mortgage lender within 45 days of the contract date; or (ii) if the purchaser

elects to obtain financing from a different lender.

        The Mortgage Rider additionally contained a hand-written provision, crafted

by the sales agent but initialed by Penny’s, which states:

              Seller financing in the amount of $191,900 for a term of
              30 years fixed at a rate of 6% with 1% discount pt. no
              prepayment penalty. Total monthly payment will include
              principal [sic], interest and escrow payments.


Nothing in that provision indicates that such financing will be considered “all

cash”

        In September 2011 counsel for Appellees wrote to Penny’s and stated that

Appellees were required to wait for commencement of construction to apply for a

                                          5
loan commitment and that as a result of delays by Penny’s, Appellees were unable

to obtain a loan commitment. Counsel also demanded return of the deposits. In

response, on September 21, 2011 counsel for Penny’s advised that pursuant to the

above-quoted printed provisions of the Agreement, Appellees were obligated to

apply for financing within five days of the Agreement and/or to notify Penny’s

within 45 days if they had not qualified for financing. Counsel further stated: “At

this point, your client’s Sales Agreement is an ‘all cash transaction.’”

      Inconsistently and confusingly counsel then quoted the hand-written

provision for Seller financing and stated: “Your clients have financing available to

close the purchase transaction of the Property.” This paragraph was Penny’s sole

reference to an agreement to provide financing in its dealings with Appellee.

      Appellees’ counsel responded to that letter by requesting a complete copy of

all documents signed by Appellees on five occasions between September and

November 2011. Neither Penny’s nor its counsel responded to those requests. On

November 29, 2011 Appellees filed suit demanding return of their deposits. In the

Complaint Appellees again alleged that they did not have copies of the documents.

Simultaneously, Appellees filed a Request for Production asking for copies of all

documents. According to the record, Penny’s was served with the Complaint in

December 2011, but failed to file an Answer. The record reflects that a default was

entered against Penny’s.



                                          6
      Despite the pendency of the action, and despite Appellees’ counsel’s

repeated requests for copies of the documents, on February 21, 2012 Penny’s

counsel sent a letter to Appellees’ counsel reiterating the printed terms of the

Mortgage Rider and again stating that “At this point, your client’s purchase of the

Property under the Sales Agreement is an ‘all cash transaction.’” Notably, no

mention was made of Seller financing, much less the means by which Appellees

could avail themselves of such financing.        The letter also advised that the

Certificate of Occupancy for the Property had been obtained on February 17 and

that Penny’s expected to close the sales transaction on February 27, 2012.

Appellees did not attend a closing on the home on February 27, 2012 and did not

otherwise respond to the letter.

      As a result of Appellees’ failure to appear at the closing, on February 28

Penny’s counsel sent another letter to Appellees’ counsel again quoting the printed

Mortgage Rider provisions, again making no mention of Seller financing and again

stating that the purchase was an “all cash transaction” at that point. The letter

declared Appellees in default for failing to appear at the February 27, 2012 closing,

but also provided Appellees with the opportunity to close on the home on February

29, 2012. The letter warned that if Appellees failed to appear Penny’s would

terminate the Agreement. Appellees again did not appear for a closing on the

home or otherwise respond to the letter. On March 1, 2012 Penny’s counsel

terminated the Agreement in writing.

                                         7
      Subsequently, Penny’s filed an Answer3 in the pending litigation in which it

alleged only that Appellees failed to timely notify it of their inability to obtain a

Mortgage Commitment and that Penny’s performance under the Agreement was

therefore excused. The Answer made no mention of Seller financing. In October

2012 Penny’s amended its Answer to include a Counterclaim, but again failed to

make any mention of Seller Financing or Appellees’ entitlement thereto.

Additionally, in March 2013 Penny’s moved for sanctions against Gasamanes

claiming that he was not entitled to return of any deposits because Prieto had

actually written the deposit checks. Again Penny’s made no mention of any Seller

financing.

      In December 2013 Appellees filed a Second Amended Complaint in which

they alleged for the first time that Penny’s had breached the Agreement by failing

to provide the Seller financing evidenced by the hand-written provision of the

Mortgage Rider. This appears to be the first pleading or other document in this

litigation in which either party made mention of the existence of the agreement to

provide Seller financing.    Nevertheless, in October 2014 Penny’s moved for

summary judgment and again failed to argue or otherwise make mention of the

agreement for it to provide financing. Instead Penny’s relied solely on Appellees’




3The record is unclear as to setting aside of the prior default, but we presume that
such was properly done.

                                         8
alleged failure to timely advise it that they had failed to obtain a Mortgage

Commitment.

      In opposition to that motion Appellees argued that Penny’s had breached the

Agreement by failing to provide the Seller financing as agreed in the hand-written

provision of the Mortgage Rider. Appellees filed their own Motion for Summary

Judgment on that same basis in December 2014. Neither motion for summary

judgment was granted and the matter proceeded to a bench trial.

      Penny’s Memorandum of Law filed prior to the non-jury trial in this matter

is the first mention it made in any pleading regarding the agreement for Seller

financing.   In that Memorandum Penny’s argued that the filing of the initial

Complaint constituted a repudiation of the Agreement citing Mori v. Matsushita

Electric Corp. of America, 380 So. 2d 461 (Fla. 3d DCA 1980).4 However,

Penny’s also acknowledged that it disregarded any such alleged repudiation by

proceeding with construction of the home and demanding closing. Acosta v. Dist.

Bd. of Trustees of Miami-Dade Cmty. Coll., 905 So. 2d 226, 229 (Fla. 3d DCA

2005) (“Where a party fails to declare a breach of contract, and continues to

perform under the contract after learning of the breach, it may be deemed to have


4 In response Appellees argued that Penny’s failure to provide them copies of the
Agreement prior to filing suit constituted a breach of the implied duty to cooperate.
PL Lake Worth Corp. v. 99Cent Stuff-Palm Springs, LLC, 949 So. 2d 1199 (Fla.
4th DCA 2007). Appellees argued that in the absence of a complete copy of the
Agreement they had no option but to file suit and that under the circumstances that
filing could not be considered a repudiation.

                                         9
acquiesced in an alteration of the terms of the contract, thereby barring its

enforcement.”).

      After a non-jury trial the trial court entered Final Judgment in favor of

Appellees and ordered that they be refunded the $38,990.00 paid, plus interest.

The trial court found that Penny’s was obligated to provide financing to Appellees

and that demanding an “all cash transaction” was contrary to the terms of the

Agreement – in essence finding that Penny’s had breached the Agreement by

demanding such a closing in its February 2012 correspondence. The trial court

further found that the Agreement had no provision requiring payment of the

$15,000 additional deposit which Penny’s characterized as being for a premium

lot. Penny’s has appealed that ruling.

      Initially we note that it appears that this litigation could have been avoided

had the parties engaged in both more and better communication. For example,

when responding to Appellees’ first demand for refund Penny’s confusingly

demanded an “all cash” closing and stated that it would provide financing.

Penny’s made no effort to explain how or when or through what mechanism such

financing could be secured. In addition, Penny’s failed to respond to five requests

for copies of the Agreement made by counsel over the course of three months.

Under those circumstances Appellees cannot be faulted for concluding that

Penny’s would not fulfill its commitment to provide financing.



                                         10
      However, even if they did not have a complete copy of the Agreement,

Appellees are equally at fault for failing to follow up on the portion of Penny’s

counsel’s September 21, 2011 letter which stated that owner financing would be

provided. It appears that much confusion and litigation could have been forestalled

if either party had initiated discussions regarding the promised Seller financing and

how it could be implemented.

      On the merits, it is clear from the record that Penny’s waived any breach

which might be said to have occurred by Appellees’ failure to advise it that they

had obtained financing from another lender and/or any breach which could be said

to have occurred by Appellees’ failure to provide the additional 10% deposit called

for in the Mortgage Rider if financing is obtained other than through Penny’s

preferred financing company. It is also clear that Penny’s waived any potential

initial breach by Appellees in filing the underlying action. We therefore affirm the

trial court’s conclusion that Penny’s breached the Agreement by demanding an “all

cash” closing (as that term is used in the Mortgage Rider).5             In its own

Memorandum of Law Penny’s acknowledged its disregard of the potential initial

breach by Appellees and binding case law supports that having waived that breach,

5 Penny’s has argued that the “all cash” term used in its letters did not mean what it
said and instead referred to a term of art in which a purchaser appears at a closing
with sufficient commitment to pay the seller, regardless of the source of that
commitment – i.e. actual cash or promissory note from a different lender or
something else. Because the term “all cash” is used in a specific way in the
Mortgage Rider, we do not apply the “term of art” as described by Penny’s under
these circumstances.

                                         11
Penny’s may not now rely upon it as a reason for reversal of the trial court’s ruling.

      Thus, the trial court correctly ruled that Appellees were not liable for any

initial breach of the contract. Acosta, 905 So. 2d at 229 (Fla. 3d DCA 2005).

      In addition, the trial court resolved any question of fact as to the reasons for

the additional $15,000 deposit in favor of Appellees. Where Penny’s did not

provide any written evidence to support its claim that it was a “premium” for an

upgraded lot and where Appellees denied any knowledge of any such premium

cost, the trial court acted properly in resolving the factual dispute.

      Affirmed.




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