## Facts

- Jim An-Chi Yeh and Lisa Yeh (sellers) entered into a written real-estate contract (a Deposit, Receipt, Offer, and Acceptance) to sell a specific Salt Lake, Oʻahu condominium unit to Harry and Adelaine Kalinowski (buyers) for $150,000.
- The contract set a closing date “on or before” late July 1989 and included financing-related contingencies for the buyers.
- The contract also contained a printed “TIME IS OF THE ESSENCE” clause permitting a party, for reasons beyond that party’s control, to extend closing once for up to 30 days by giving timely written notice to escrow; any further extension required a written agreement by both parties.
- As the initial closing approached, the buyers used the clause’s procedure to extend the closing date by 30 days through timely written notice to escrow.
- The parties later executed additional written extensions moving the closing date further into the fall of 1989.
- By the final extended closing date, the buyers had obtained financing and were ready, willing, and able to close and pay the purchase price.
- The sellers did not close and did not deliver the condominium to the buyers. The sellers asserted that the contract had terminated based on the time-is-of-the-essence language and the passage of the closing date(s).
- After refusing to close with the buyers, the sellers attempted to sell the condominium to another purchaser at a higher price.
- The buyers sued for specific performance. The circuit court found for the buyers and ordered the sellers to convey the condominium. The sellers appealed, arguing that specific performance was an extraordinary remedy and improper on these facts.

## Issues

1. Whether the sellers could treat the condominium sales contract as terminated and refuse to convey the unit based on the contract’s time-is-of-the-essence clause and closing-date provisions, after the parties extended the closing dates and the buyers were ready, willing, and able to perform.
2. Whether the trial court erred or abused its discretion by ordering specific performance of the real-estate contract.

## Decision

- The Intermediate Court of Appeals of Hawaiʻi affirmed the judgment ordering specific performance.
- The court rejected the sellers’ attempt to rely on the time-is-of-the-essence clause to avoid performance where the contract had been extended in writing and the buyers were prepared to close.
- The court held that specific performance was an appropriate remedy for the sale of a specific condominium unit when the buyers were ready, willing, and able to perform and the sellers wrongfully refused to convey.

## Legal Principles

- A time-is-of-the-essence provision in a land-sale contract must be applied consistent with the parties’ subsequent written modifications and conduct; agreed extensions can change the operative closing date.
- A party generally may not avoid a contract by invoking a deadline or condition when the nonperformance is tied to that party’s own failure or inability to complete the transaction as required.
- Specific performance is a customary remedy for breach of a contract to convey identified real property, including a particular condominium unit, because damages may be inadequate and the property is treated as unique.
- A trial court has equitable discretion in granting specific performance; relief is proper when the purchaser is ready, willing, and able to perform and enforcement is not unfair to the seller.

## Conclusion

Kalinowski v. Yeh upheld an order compelling the sellers to convey a specific condominium unit because the buyers were ready to close by the extended deadline, the sellers could not use the time-is-of-the-essence language to justify refusing performance after written extensions, and equity supported specific performance of the real-estate contract.


Kalinowski v. Yeh, 847 P.2d 673 (1993)