## Facts

- Renovest agreed to buy from Hodges a two-building apartment complex for \$1,476,000 and paid a \$65,000 deposit designated as liquidated damages if Renovest failed to close by September 3, 1986.
- The agreement required written notices and included conditions precedent relevant here:
  - Inspection condition: inspection within 14 working days; if unsatisfactory, buyer had three days from completion of inspection to give written disapproval; if properly invoked, the contract would be void and deposits refunded.
  - Financing condition: after reviewing the seller’s business records, buyer had 45 days to give written notice invoking the contingency if it could not obtain financing on specified terms.

- Renovest inspected on July 10, 1986 and found a significant exterior crack; additional inspections occurred around July 17 and July 23.
- Renovest was concerned lenders would not finance the purchase due to the crack and did not pursue financing diligently; Hodges obtained an engineer’s evaluation indicating the building was structurally sound, but Renovest did not meaningfully use that information to renew financing efforts.
- On August 7, 1986 Renovest sent written notice terminating under the inspection condition; on August 12 it sent a second notice invoking failure to obtain financing.
- Hodges refused to return the deposit, asserting the inspection notice was untimely and Renovest failed to make reasonable efforts to obtain financing.
- In a jury-waived trial, at the close of Renovest’s case the trial court granted Hodges’s motion to dismiss, finding Renovest failed to carry its burden.

## Issues

1. In a nonjury trial, may the judge, on a motion to dismiss at the close of the plaintiff’s case, weigh evidence and make findings, and what is the standard of appellate review?
2. Did the buyer strictly comply with the inspection condition’s timing and written-notice requirements, or was the deadline waived?
3. Did the buyer make reasonable, good-faith efforts to obtain financing sufficient to rely on the financing contingency to terminate and recover the deposit?

## Decision

- The Supreme Court of New Hampshire affirmed the dismissal and upheld Hodges’s retention of the \$65,000 deposit as liquidated damages.
- In a bench trial, the trial judge may weigh evidence and make findings when ruling on a dismissal motion at the close of the plaintiff’s case; appellate review of findings is for clear error, and dismissal stands unless inconsistent with findings or contrary to law.
- The inspection contingency was an express condition precedent requiring strict compliance; the buyer’s August 7 written disapproval was untimely and ineffective.
- The trial court did not clearly err in rejecting waiver; cooperation in further inspections did not show an intent to relinquish contractual deadlines, and no written extension was shown.
- The trial court did not clearly err in finding the buyer failed to make reasonable efforts to obtain financing; the buyer’s assumption that financing would be unavailable did not excuse performance.

## Legal Principles

- In a jury-waived trial, a court ruling on dismissal at the close of the plaintiff’s evidence may act as fact-finder, weigh credibility, and determine whether the plaintiff proved its case by a preponderance; appellate review of factual findings is for clear error.
- Express conditions precedent created by contract terms generally require strict compliance, including compliance with specified timing and notice requirements.
- Time is not automatically “of the essence” merely because a contract lists dates, but strict timing may be required when the date is part of an express condition precedent.
- Waiver requires either explicit language or conduct clearly indicating an intent to relinquish a known right; continued discussions or cooperation, without more, may be insufficient.
- A buyer invoking a financing contingency must show reasonable, good-faith efforts to obtain the specified financing; abandoning efforts based on unilateral assumptions does not satisfy the condition.

## Conclusion

The court upheld dismissal because the buyer failed to strictly and timely invoke the inspection contingency, failed to prove waiver of the contractual deadlines, and did not exercise reasonable, good-faith efforts to obtain financing, leaving the seller entitled to keep the deposit as liquidated damages.


Renovest Co. v. Hodges Dev. Corp., 135 N.H. 72, 600 A.2d 448 (N.H. 1991)