Last year, the Fourth District Court of Appeals issued a decision addressing whether a home buyer had anticipatorily breached a contract for the construction of a home. The case began as a breach of contract suit brought by the prospective buyers of a home. The buyers sued the seller for breach of contract, arguing that the seller failed to complete construction within twenty-four months as provided for in the contract. In defending the case, the seller argued that the buyers had anticipatorily breached the contract. Following a bench trial, the trial court rejected the seller’s claims of anticipatory repudiation and entered judgment in favor of the buyers. In its decision, the Fourth District affirmed the final judgment of the trial court, but for reasons different than those provided for by the trial court. Decision at *1.
During the course of the construction of the home at the center of the litigation, buyer’s counsel sent a letter to seller’s counsel stating in part:
I understand that the value of the home has decreased significantly from the time of the Agreement. With this in mind my client may not be able to obtain financing under the same terms and conditions as originally scheduled. It was represented to my clients that the home would most assuredly appreciate from the time of contract to the time of closing. This material misrepresentation induced my clients to enter into the Agreement. Your client’s fraudulent misrepresentation may render closing impossible.
The trial court rejected the seller’s claims that the letter from buyer’s counsel constituted anticipatory repudiation. According to the lower court, the letter from buyer’s counsel “could not be construed as an indication that they [buyers] would not close on the home and is deemed by the Court not to be an anticipatory breach.” Decision at *3. The seller appealed, arguing that the trial court erred in not finding that the buyers committed anticipatory repudiation.
The Fourth District began its analysis by looking at the definition of anticipatory repudiation:
A prospective breach of a contract occurs when there is absolute repudiationby one of the parties prior to the time when his performance is due under the terms of the contract. Such a repudiation may be evidenced by words or voluntary acts but the refusal must be distinct, unequivocal, and absolute.
Decision at *4, citing Mori v. Matsushita Elec. Corp. of Am., 380 So. 2d 461, 463 (Fla. 3d DCA 1980). The Court noted, however, that because the parties defined anticipatory repudiation within the terms of the contract, it was not necessary to apply the “high standard” set by the Third DCA in Matsushita. Decision at *4. Instead, under the contract anticipatory repudiation was defined as the buyers informing the seller that they “may be unable or unwilling to close”. Id. The Court found that the letter from buyer’s counsel to seller’s counsel met the low standard of anticipatory repudiation as defined under the contract. Id.
Although the Fourth District found that the buyer’s letter constituted anticipatory repudiation, contrary to the trial court, the Court nevertheless affirmed the final judgment. According to the Court, upon receiving the buyer’s anticipatory repudiation, the seller ignored its own breach remedy under the contract and instead never scheduled the closing of the sale of the property as required under the contract. Decision at *4. Instead, the seller completed the home after the twenty-four month completion period and sold it to a new buyer. By doing so, the Court found that the seller breached the contract’s requirement that the home be completed within a twenty-four month period. Id. Citing a Florida Supreme Court decision, the Fourth Circuit held that if “a trial court reaches the right result, but for the wrong reasons, it will be upheld if there is any basis which would support the judgment in the record.” Decision at *5, citing Dade Cnty. Sch. Bd. v. Radio Station WQBA, 731 So. 2d 638, 644 (Fla. 1999).