Can someone explain this to me? I don't understand the answer. (This came from PMBR.)
A speech pathologist owned the building in which she had her business. When she decided to marry, she wanted to move, so she arranged to sell the building to an ear, nose, and throat doctor for $350,000. They entered into a written sales contract, which provided a closing date of March 1, at which time the doctor was to submit full payment to the speech pathologist in exchange for the deed to the property. On March 1, however, the speech pathologist and her new husband spontaneously decided to take a weekend trip, and she failed to deliver the title to the doctor.
If the doctor sues immediately for breach of contract, will he prevail?
A Yes, because the speech pathologist's tender of the title was a condition precedent to the doctor's obligation to pay $350,000.
B Yes, if the doctor was prepared to tender his payment of $350,000 on March 1.
C No, unless the doctor paid the speech pathologist $350,000 on March 1.
D No, because the contract contained no "time is of the essence" clause.
The correct answer is: Yes, if the doctor was prepared to tender his payment of $350,000 on March 1.
Discussion of correct answer: Concurrent conditions are those that are mutually dependent and are to be performed at the same time. Any contract for the sale of real property contains concurrent conditions, in that each party's performance is conditioned upon the other party's performance, and both conditions can occur at the same time. If one party breaches the agreement, the aggrieved party, prior to filing a breach of contract action, must show that he did perform or was prepared to perform his contractual duties. In this case, under the parties' contract, the speech pathologist was to tender the title to the building and the doctor was to tender payment of $350,000. The speech pathologist's tendering the title was a condition of the doctor's obligation to pay, and his tendering of payment was likewise a condition of the speech pathologist's obligation to tender the title. To be entitled to recover in a breach of contract action against the speech pathologist for her failure to tender title, the doctor is first required to show either that he paid or was prepared to pay the agreed-upon amount. Having shown that he was prepared to meet his contractual obligation, the doctor could then sue the speech pathologist for her failure to perform.
Incorrect answer: No, because the contract contained no "time is of the essence" clause.
Discussion of incorrect answer: In contracts for the sale of land, time is not considered to be "of the essence" unless expressly stated in the contract or the parties have by their conduct manifested an understanding that time is of the essence. While it is true that there are no facts indicating that time was of the essence in the parties' agreement, this factor has little relevance to the issue of whether the doctor is entitled to recover in a breach of contract action against the speech pathologist. The doctor's right to recover in a breach of contract action against the speech pathologist based on her failure to perform does not hinge upon whether time was of the essence, but on whether the doctor fulfilled or was prepared to fulfill his duties under the contract. As such, this response is incorrect.
I'm confused. I thought the rule was that if there is no "time is of the essence clause" then either party can perform within a reasonable time. The answer even acknowledges this. So, why is it that even though there's no "time is of the essence clause" here, the doctor can sue immediately on March 1? If the pathologist can still perform within a reasonable time, doesn't that mean there's no breach?