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A DEADLINE SET IN A TIME-IS-OF-THE-ESSENCE LETTER CAN BE WAIVED ORALLY, OR EVEN BY CONDUCT ALONE (SECOND DEPT).

The Second Department, reversing (modifying) Supreme Court, determined there was a question of fact whether defendant orally waived the deadline for the real estate transaction set in a time-is-of-the-essence letter:

… “[I]t is well settled, in New York, that an oral waiver of the time for the sale of real property will be given effect” … . [Plaintiff’s] assertion, made under the penalties of perjury, that he was assured by the defendant’s president that the plaintiff would not be held in default in the event that it failed to close the transaction on May 15, 2019, was sufficient to raise a triable issue of fact as to whether the defendant’s president made a statement … that operated as a waiver of the defendant’s right to enforce the May 15, 2019 deadline for the closing. Contrary to the defendant’s contention, in order for such a waiver to occur, it was not necessary that the [time-is-of-the-essence] letter be withdrawn in a formal communication from the defendant’s attorney. A waiver of the right to timely performance under a contract “need not be in writing in order to be valid and enforceable” … . Such a waiver may occur even without an oral statement, such as the one that was allegedly made in this case, and may instead be inferred solely from a party’s conduct … . LG723, LLC v Royal Dev., Inc., 2023 NY Slip Op 02653, Second Dept 5-17-23

Practice Point: A deadline in a time-is-of-the-essence letter can be waived orally or by conduct alone.

 

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