## Facts

- Peter and Patricia Shimrak agreed to buy a residence from Susan Goodsir (as trustee) for $340,000 and paid $2,000 in earnest money.
- The purchase agreement included a financing contingency requiring the buyers to obtain a loan commitment within 30 days after the seller accepted the offer.
- The financing clause required the buyers to apply promptly, cooperate with the lender, and use good-faith efforts to obtain the loan.
- The clause addressed what would happen if, within 30 days, the loan application was neither approved nor denied: the buyers could either (a) request a written extension of time to obtain financing, or (b) remove (waive) the financing contingency in writing.
- The clause also provided that if the seller refused an extension request and the buyers did not remove the contingency, the agreement would be null and void and the earnest money would be returned.
- The buyers applied for financing, but their bank would not finance the purchase unless the buyers first sold their existing home.
- Rather than requesting a written extension under the financing clause, the buyers proposed amending the purchase agreement to add a new condition making the purchase contingent on the sale of their current home.
- Goodsir rejected the proposed amendment.
- The buyers did not obtain financing and later notified Goodsir that they were withdrawing from the transaction.
- Goodsir later sold the property for substantially less than the contract price.
- The buyers sued for return of the earnest money; Goodsir counterclaimed for breach of contract and sought declaratory relief regarding the parties’ rights under the purchase agreement.
- The trial court ruled for the buyers, concluding that the financing-contingency options were discretionary and that the proposed amendment functioned as an extension request that Goodsir “refused,” thereby voiding the agreement.
- Goodsir appealed.

## Issues

1. Whether the financing-contingency clause allowed the buyers to walk away without either requesting a written extension or removing the financing contingency in writing when financing was not approved or denied within 30 days.
2. Whether the buyers’ proposal to amend the contract to add a “sale of buyers’ home” contingency qualified as a contract-defined request for a written extension.
3. Whether the seller’s rejection of the proposed amendment voided the purchase agreement and entitled the buyers to return of the earnest money.

## Decision

- The court of appeals reversed the trial court’s declaratory judgment for the buyers and remanded.
- The court held the financing-contingency clause set out the buyers’ contractual choices if the loan was neither approved nor denied within 30 days, and the buyers could not treat the agreement as automatically void without using those procedures.
- The court held the buyers’ proposed amendment adding a new contingency (sale of their current home) was not the same as requesting a written extension under the financing clause.
- Because rejection of the proposed amendment was not a refusal of a contract-recognized extension request, it did not trigger the clause making the agreement null and void.
- The court concluded the buyers breached the purchase agreement by withdrawing without properly invoking the contingency clause’s termination mechanism, and it directed the trial court to enter judgment for Goodsir and determine damages.

## Legal Principles

- Courts enforce unambiguous contract language as written and do not rewrite the parties’ agreement.
- When a contract specifies the steps a party must take to extend time or terminate based on a contingency, the party must use those steps to claim the contract ended without breach.
- A proposal that adds a new condition to the parties’ bargain is a contract modification that requires mutual assent; it is not treated as exercise of an option already defined in the contract unless the contract says so.
- A party that unilaterally withdraws from a binding purchase agreement without satisfying the contract’s contingency procedure may be liable for breach and resulting damages.

## Conclusion

In *Shimrak v. Goodsir*, the Ohio Court of Appeals held that the buyers could not avoid the home purchase contract merely because their lender conditioned financing on selling their existing home. The financing-contingency clause required the buyers, after 30 days without approval or denial, to either request a written extension or remove the contingency in writing; proposing a new home-sale contingency was a material change, not an extension request under the contract. Because the seller’s rejection of that amendment did not void the agreement, the buyers’ withdrawal constituted a breach, requiring judgment for the seller and a remand to determine damages.


Shimrak v. Goodsir, 2014 WL 4244313 (2014)