California Court of Appeal

Judgment for plaintiff-buyer in an action in which plaintiff alleged that defendants seller and escrow company were at fault for an escrow not closing on Friday as agreed, causing damages to plaintiff for the delay including the loss of tax benefits because the transaction was part of an Internal Revenue Code section 1031 transaction to defer the plaintiff's capital gain tax on the plaintiff's sale of another property, and the 1031 qualified exchange intermediary closed and filed for bankruptcy on the following Monday, is reversed in part and remanded, where: 1) there was insufficient evidence the contract damages assessed against defendant seller based on the bankruptcy were foreseeable; and 2) as to defendant escrow company, the trial court failed to instruct the jury on an intervening and superseding cause, i.e., the bankruptcy of the 1031 qualified exchange intermediary.

Appellate Information

• Decided 02/18/2014
• Published 02/18/2014

Judges

• MOSK

Court

• California Court of Appeal

Counsel