Reported / Citable
Background
Laurence Nasey lost two San Francisco mixed-use properties in foreclosure, then agreed with the new owners that he could remain, pay rent, and repurchase them for $10.5 million. Multiple addenda extended the closing date, ultimately to September 29, 2022, but he did not close.
Nasey later sought declarations that the sellers’ failure to provide statutory transfer and hazardous-substance disclosures excused his performance and that they wrongfully prevented an environmental assessment requested by his lenders. The trial court dismissed after allowing repeated amendments.
The Court’s Holding
The Court of Appeal affirmed. Although the form contract contained standard disclosure language, the simultaneously executed and later addenda said the transaction had no contingencies, relieved the sellers of document and disclosure obligations, confirmed their performance, and made those terms controlling. On this contract, delivery of a transfer disclosure statement was not a condition that had to occur before Nasey performed.
The hazardous-substance theory also failed because the pleading did not adequately allege facts triggering the former statute’s disclosure duty. And the inspection theory conflicted with the bargain: Nasey made an all-cash offer not contingent on financing, accepted a short investigation period, and agreed that invasive or destructive testing required advance written consent.
The court treated the agreement as an allocation of risk. The buyer could not shift the financing and investigation risks back to the sellers after the agreed closing deadline passed, and his undeveloped request for another amendment was forfeited.
Key Takeaways
- Specific addenda can override inconsistent boilerplate in a standard purchase form.
- Calling a seller disclosure statutory does not automatically make it a condition precedent under every contract.
- An all-cash, no-financing-contingency term puts lender and funding risk on the buyer.
- Environmental investigation rights remain subject to negotiated deadlines and consent requirements.
Why It Matters
Real-estate parties should read the integrated deal documents as a whole. Buyers should preserve needed disclosure, financing, and inspection protections explicitly; sellers should ensure later extensions say which original obligations survive. Courts will generally enforce a clear allocation of closing risk rather than retrofit contingencies after performance fails.