When it comes to Nevada sales contracts, time is of the essence

Most state courts, including the Nevada Supreme Court, recognize and enforce the integrity of “time is of the essence” clauses. The Nevada Supreme Court recognizes that under common law, a means of payment that a party is required to pay by a specified time and place must be made on the date specified for payment, and not after, and that an appeal against forfeiture not granted if the time of performance is made essential by the express terms of the contract, which state: “[a] The court of equity has no more power than a court to waive an express provision by the parties relating to time in contracts of this type.” In one case, the Nevada Supreme Court saved the defaulting buyer from the hard forfeit of foreclosure of the “hire purchase agreement ‘ in which the installment buyer (the rightful owner) was only $63.75 in arrears in tax and interest and the seller had attempted to forfeit the buyer’s equitable interests under a harsh and unfair process. Often the court will deny the bail out the defaulting buyer, as has been done in many “equitable conversion” cases under hire purchase agreements, to avoid harsh, unjustified forfeiture.

Cases of “equitable conversion” are cases in which the buyer acquires property on installments “contract for deed”. In such cases, even if the deed and ‘title’ cannot be delivered until all payments have been made, the ‘equitable title’ will be held by the buyer in the meantime. In an often-cited deed purchase contract, the Nevada Supreme Court saved the buyer from total forfeiture of the property by giving the buyer a reasonable period of time to cure, although the period was an essential clause because the default was minor by comparison to the significant forfeiture that would have occurred had the court not bailed out the buyer through equity. in the slobe, given the significant $90,000 investment in the disputed motel, the installment buyer was given a reasonable time to recover a $8,320.28 default. The courts have been willing to save buyers from harsh foreclosures if they have taken legal, peaceful possession and upgraded the property and/or made significant payments on it. However, in cases of unfair conversion, the courts have not been as willing to rescue and will require strict adherence to the “time is of the essence” rule. The Nevada Supreme Court ruled that [t]It is generally accepted that in order to successfully sue a seller for damages for breach of a contract for the sale of land, a buyer must show that he has complied with any conditions precedent or concurrent, or that such performance has been excused.

Even the decisions of the surrounding states courts of appeals hold identical to Nevada case law that a seller of real estate under a real estate purchase agreement is entitled to cancel the escrow if the buyer has failed to perform a material part of the agreement concurrent with the seller’s performance obligations or condition precedent. In one case, the property buyer offered his service three hours longer than the stated service time. The Court of Appeal ruled that the buyer had breached the contract and was not entitled to a specific service because the “time is of the essence” clause and plaintext contained in that purchase contract caused the contract to expire exactly three hours before the service was offered .

It has been determined that if neither party offers performance by the date set for its conclusion under a contract where time is of the essence, the obligations of both parties will be fulfilled upon the expiration of that date.

If the Trust Deed stipulates a specific time for performance, the performance must be made within the period of the Deed and the Trustee has no authority to deliver any instrument thereafter. It is clear that the payment must be made within the period of the trust agreement.

The Nevada Supreme Court recently ruled that “this court will not rewrite the parties’ contract and will require strict adherence to the ‘time is of the essence’ provision.

So real estate agents, attorneys and buyers should beware: the “time is of the essence” clause is still alive in Nevada and the surrounding states. Most courts will rely on this clause and long-standing precedent to refuse any compensation to a defaulting buyer, based on the sound legal principle that a contract of sale expires on its own terms and will not be rewritten or extended by the court. The exception to the rule is applied to prevent a hard, unfair forfeiture when a defaulting purchaser of an installment contract is saved from a hard forfeiture that would not be justified by a relatively minor breach that could be cured within a reasonable time. In such cases, the justice laws will intervene to promote fairness and avoid the harsh, unjust forfeits that would otherwise result from strict application of the “time is of the essence” clauses. In such cases, the courts have preferred an action for damages to a total loss of a substantial reasonable interest.

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